Compared for me

When it comes to online DVD rentals, the first company that pops up in people’s mind is Netflix. After all, it is one of the two biggest, if not the largest DVD rental company in the world. But a new company is changing all that. Redbox is revolutionizing the DVD rental services industry. Aside from being a fully-owned subsidiary of the McDonald’s Corporation (yes, the fast food company), Redbox is also taking a unique approach to this business.

In a number of McDonald’s outlet, there are already Redbox kiosks set up inside. This number is continually increasing as the subsidiary expands their operation. It is also interesting to note that the company allows clients to return the DVDs to any of its branches. Basically, after you rent a movie for $1/day from any Redbox branch, you can return the disc to the outlet that is most convenient to you.

 
For heavy travelers, the approach provides a great incentive. For example, if they’re taking a flight from one city to another, it is possible to rent a Redbox DVD from one kiosk and then return it at a kiosk located at the destination. The movie can be watched during the flight, eliminating the need to rent DVDs from the airport.

There are certainly a lot of upsides in renting from Redbox. However, it is not without its limitations. It is easily obvious that the company cannot carry a lot of titles in a single kiosk. In many cases, they can carry roughly 50 titles at the maximum due to space limitations. The movie you want may not be available at the time of visit since the company relies on physical discs.

But it might be more interesting to see how McDonald’s subsidiary affects the competition. Right now, a significant cost in running a DVD rental online company such as Hollywood Video and Blockbuster is their space rental. Because they pay per square footage and hire staff to maintain operations, their operating expenses are quite high. Redbox automates the process so it deals with less overhead. Thus, it is capable of renting out quality DVDs at an affordable price. Leave it to McDonald’s to change the way people watch movies, reminiscent of the way it changed people’s eating habits.