To Beat Studio Rules, Netflix, Redbox Head to ... Walmart?

They buy discs at retail prices
By Dustin Lushing,  Newser Staff
Posted Jun 8, 2012 5:17 PM CDT
Netflix, Redbox Find Easy Way to Beat Studio Rules
A film image from "John Carter."   (AP Photo/Disney)

(Newser) – Disney is squabbling with Netflix and Redbox over the DVD of sci-fi flick John Carter, and the feud reflects the intensifying battle for revenue between studios and rental companies, reports the Los Angeles Times. Disney recently cut off DVD sales to such rental providers until 28 days after discs go on sale in stores. But Netflix and Redbox are simply bypassing the freeze-out window by buying new releases (like John Carter) at retail prices from suppliers such as Walmart and Target.

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Disney and other studios such as Universal Pictures and 20th Century Fox want to delay rentals so customers might buy the movie instead. When they do sell copies to Netflix and Redbox, after the delay period, the discs are discounted. But a few market analysts say the rental powerhouses can survive paying the premium from retailers, which amounts to about double the price. "These companies own the rental market, which gives them a lot of power," says a media analyst. "Eventually there will have to be a compromise." (Read more John Carter stories.)

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