Blockbuster switches to Redbox-style single-day rental pricing

Posted May 27, 2011, at 8:52 p.m.

LOS ANGELES — The days of the multi-day movie rental are officially over.

Blockbuster LLC announced Friday that it is switching to single-day pricing in a bid to better challenge its fast-growing competitor Redbox. It’s the first significant change at the struggling rental and retail chain since it was acquired by Dish Network Corp. in April for $320 million and a longtime executive of the satellite broadcaster was put in charge.

New releases will cost $2.99 the first day, while older films are $1.99 the first day. All movies will cost 99 cents for additional days. That’s more than the 99 cents per day that Redbox charges for rentals every day, including the first.

Previously, Blockbuster charged $4.99 for a three-day rental.

By charging more for the first day, Blockbuster will be able to maintain what has been its one significant advantage over Redbox and its other, larger rival, Netflix: New releases from major studios available to rent the same day they go on sale. 20th Century Fox, Universal Pictures and Warner Bros. all restrict Redbox from renting their DVDs until 28 days after they go on sale because they believe 99 cents is too low a price for a first-night rental.

Those three studios, along with Sony Pictures and Walt Disney Studios, also place similar restrictions on subscription rental service Netflix.

Despite expectations that Dish would move to close many of Blockbuster’s retail locations, only a handful of the 1,700-plus it took control of in the sale have shut down. A spokesman for Dish said the company is still considering how many to keep open and that the decision rests in part on negotiations occurring with studios over the terms under which it obtains DVDs.

Dish has yet to detail plans for a Blockbuster-branded digital offering to compete with Netflix’s online streaming service, a plan that people close to the company said was part of the rationale for the purchase last month.

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