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Better to rent, buy or download the latest flicks?

/ Source: TODAY

Planning to spend the night curled up on the sofa with a good movie?  You no longer have to hop in the car and drive to the nearest video store. These days, you may be hard-pressed to even find one.  But, there’s a growing list of options—from DVD mail-clubs and vending machines—to online movie downloads and sites where buying used DVDs is almost as cheap as renting.Shifting movie habitsAccording to the Entertainment Merchants Association, each month, approximately 28 million households purchase a DVD, and 27 million rent one to the tune of about $23 billion in sales.  That’s nearly three times what we spend at traditional movie box offices.  Big business, big shift.  And here comes the Internet which is expected to be game-changing, just as it fundamentally transformed the music industry.  This is good news for consumers, because it means there are a lot of players competing for your business and by extension, a lot of deals to be had.But with so many options available, it’s hard to know where to start and which site or service makes the most sense for you. Begin by taking a good look at the overall way you "consume" movies and factor in a few key variables, including:

  • How many and the range of movies you currently watch in a given month
  • How much you’re willing to spend overall and for convenience
  • Whether you're a planner or more spur-of-the-moment type
  • How organized and tech-savvy you are How the services work: Go to the site, pick a membership plan, sign up, and then begin selecting movies.  Movies are mailed to you with free shipping both ways with no due dates or late fees. and, stock 90,000 and 80,000 titles respectively—indie films, foreign films, documentaries, exercise videos—you name it. Many are also available in Blu-ray and HD formats.  Netflix also has a whopping 7,000 movies and TV show titles you can watch instantly on your PC and they start playing in as little as 30 seconds.

After you’ve viewed the movies on DVD, ship them back in the provided postage paid envelope and they mail you the next movie(s) in your "queue".  In the case of Blockbuster, there’s an option to return movies to one of their stores, but the fee is slightly higher. If you already have a Blockbuster Store membership, this may still be a draw because you can rent a new one when you're there on the fly (and maybe even pick up some Twizzlers).

The Netflix numbers are stunning. They currently mail an average of 1.8 million DVDs a day from more than 100 shipping locations and nearly 95% of Netflix subscribers live in areas generally reachable with one business day delivery. Once it ships, you'll likely be surprised how quickly the signature red envelope shows up in your mailbox. There's nothing fancy about it and sometimes the DVDs are pure silver with little or no labeling and movie marketing imaging.  Cost: Prices vary according to the plan you choose, which dictates how many videos you can have out at one time and the maximum allowable per month.  Plans start at around $4 per month for two movies and go up to nearly $50 for eight movies at a time, with no limit on how many times you can swap them.  The 7,000 streaming videos are all free with your mail subscription plan. 

Netflix's most popular plan is $16.99 for three DVDs at a time, with no limit on swapping.  If you're watching two movies a week, that's eight movies a month at about $2 bucks a pop.  Not bad.  If you only watch two movies a month, it's $8.50 each.  Cheaper than going out, but suddenly it seems like less of a bargain.  If things don't go as planned and the little red envelope sits around for two months, and you only watch two of them over two months, now they're about $17 each!The bottomline: The value of the subscription plan is directly correlated to how much use you get out of it (think of your gym membership).  Once you've signed up, you are billed each month, whether you rent or not.  Netflix is great about letting you suspend or adjust your plan at any time and the adjustment is made at the start of the next billing cycle.  Still, the win-win here is to pick the plan you'll make best use of and milk it.
DVD rental vending machines
www.redbox.comHow they work: You've probably run into one of these lately—they're essentially DVD vending machines.  There are more than 7,000 of them nationwide in grocery stores, Walgreens, McDonalds, with more continuing to pop up in more places. You can find Redbox locations near you, by logging on to the site and entering your zip code. They'll list the locations and even provide a link to MapQuest driving directions. 

You can reserve a movie online with a credit card and then you'll have until 9 pm the next day to pick it up. When you go pick it up in person (you'll need to use the same credit card for verification), a DVD reservation made online is specific to the Red Box machine you've selected.  So, if you go there and there are maintenance issues (the equivalent of a broken coke machine), you're out of luck.  Returning DVDs in not specific to a particular RedBox kiosk.  So, you could use the one at your local grocery store if you know you're going to be there again within the next few days; or you could pick one up at a kiosk near work on Friday and return it to a kiosk closer to home on Saturday.  Cost: $1 per night and the return deadline is 9 pm. So, if you don't watch the movie the night you rent it, watch the clock the next night and try to start a two hour film before 7 pm to have a shot at making the return deadline.  Otherwise, the next dollar and tax day kicks in.  After a certain number of days (usually 25), rental charges cease and the DVD is yours to keep.

The bottomline: If you're forgetful, it'll cost ya.  So, make sure your teenagers know the movies in the backseat need to go back!  Your credit card is held and then billed upon the movie return (similar to the hotel model of getting a final bill when you check out).  Redbox kiosks hold more than 500 DVDs.  The title selection is a bit limited—usually between 100 to 200—mainly top hits, but that's what most people are really after.  New titles are available every Tuesday.  A "hot" film can go fast but overall, this affordable option is great for spur-of-the- moment DVD rentals.  Buying new and used DVDswww.DVD.Empire.comHistorically, movies tend to be an affordable luxury—and that's truer than ever as the cost of used DVDs goes down.  If you have young children who are going to want to watch a particular movie over and over (is there such a thing as seeing "Finding Nemo" too many times?), purchasing may be way to go.  Also movie "collectors" are still purchasing DVDs which feature bonus interactives like games and a "digital copy" of the movie that can be downloaded to a computer in about five minutes (less time than via the Internet).  Essentially it's the same movie in multiple formats.  Cost: You can search used DVD sites like by genre, age, price, etc. A search for DVDs under $7 turns up more than 3,000 titles.  Are they the top selling new releases everyone is after?  Not necessarily at those price points, but they have those too at some of the best going rates.

Used DVDs are also available on and eBay, as well as in-stores.  Online they'll tell you the condition of the DVD as part of the listing.  In-store, you may see a "Previously Viewed" sticker.Even if the price is right, you don't want to make costly (both time and money) mistakes purchasing films you don't end up enjoying or ones that aren't age-appropriate.  That's one reason sites like are seeing record traffic as people "preview" films and read reviews before making the purchasing or rental plunge.  Movie On the Pay-Per-View side (offered by your local cable or satellite company), it's all about "instant gratification."  On the Internet, downloading movies is just like downloading music—it just takes little longer and uses up a lot more space if you download it (and keep it) versus renting and streaming it once.  A two hour movie uses roughly the same space on your hard drive as 250 songs.  But extra storage space has come way down in cost, so you can always ramp it up as needed. 

How it works: For Amazon Unbox or iTunes, you have to have their proprietary players to get started.  The Amazon Unbox player is quick to download and will then be an icon on the front screen of your computer, so it's easy to find. 

For iTunes, you'll be prompted to upgrade to the latest version. After these free installs, you're ready to select your TV show or movie and press "buy" or "rent"  (high-speed access is a must). Amazon's Unbox service  "streams" the videos, so you can start watching right away while the download proceeds behind the scenes if you've purchased it. Thirty minute TV shows are quick and easy on a high performing hi-speed connection. A two-hour film may take 20-60 minutes to download in its entirety, but you'll be able to start viewing right away on UnBox.  iTunes waits for the download to complete and then you "sync" it to your device, just as with music.Cost and selection: Movie rentals are priced on a sliding scale based on popularity and come in around $3.  If you opt to buy, the prices vary, but expect to pay closer to $10.  As for selection, Amazon Unbox has over 20,000 movies and TV shows for rental or purchase.  ITunes has 1,600 movies and TV shows for rental or purchase.  Watch for heavy promotion to fuel this phenomenon. Amazon has weekend specials with their most popular downloads for as little as .99 cents. They're banking on people who try the service coming back, much like they did when they made their first book purchase years ago.On both iTunes and Amazon UnBox, rentals last 30 days from purchase or twenty-four hours from the time you start playing.  You can pause it along the way and it'll start right back up where you left off when you're ready to resume.  One thing you can't do at this juncture is burn the download to a DVD. 

New laptop computer screens are bigger and better than ever with vastly improved clarity and resolution, so the caliber of the end-viewing experience is really high.  And, if you haven't seen a movie playing on an iPhone yet, you won't believe your eyes. 

A look ahead what happens next and where is this all headed?  There are a lot of moving pieces, but—ultimately—most industry experts have this going the way of music—building libraries and synching them to various screens—TV, laptop, cellphone, etc.  The hardest thing to shift is consumer behavior and the technology and price has to be approachable before you'll see mainstream adoption. 

Younger people have a head start since they live on their laptops.  So, watching a movie on a computer screen is second nature to them.  Pretty soon we may not really even differentiate between what's a computer screen and what's a TV screen.  We won't care.  We'll just want to dictate what gets "pushed" to them.   That may mean having yet another little box near your TV, but you've probably already got a stack of them (DVD player, VHS, Cable Box, etc.), so what's one more?  At least Apple TV is small and stylish at a mere seven inches.  

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