Blockbuster Plans to End Late Fees in 2005

Believe it or not, Blockbuster is planing to end its "late fees" policy soon to compete with online rental stores(such as NetFlix.) Obviously they have realized that a lot of people have moved to online stores because they can keep the DVD for as long as they want.

I thought companies like Blockbuster get most of their revenues from late fees. But I guess the shady(imho) details in the new policy make up for it:

"Renters who keep the movies or games beyond the grace period [2 days or 1 week] will be charged for purchasing the DVD or tape at Blockbuster's full retail price, minus the rental fee... If they return the movie or game in the next 30 days, they will get a refund for the purchase but will be charged a restocking fee of $1.25, the company said."

I would guess there will be a lot of money flow for people paying retail price and then later get back by refund... Is it the same (or better) than online stores? Not to me...

via: Boing Boing


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