Renting DVD’s online has boomed, causing millions of consumers to leave their local video stores for good.  Or has it?  Here is the information that online providers may not want you to hear.

The Big Three:

While other providers exist, Netflix, Blockbuster, and Wal-Mart control the market.  Netflix boasts the most subscribers and selections, having pioneered the business in the late 90’s.  Blockbuster is the hottest of three, and continues to grow at an exponential rate.  The global giant Wal-Mart is the weakest of three, due to their unwillingness to go full-steam into this ‘project’.  With Wal-Mart’s power and capitol, this could change at any time.    

How much does it cost?

Unlike paying flat fees at your local video store, this is a monthly service, which means another bill added to your credit card statement.  The standard 3-at-a-time plan is cheapest at Blockbuster for $14.99/month, while Wal-Mart and Netflix both run over $17/month.  Additional plans do exist and prices fluctuate accordingly.  Netflix and Blockbuster offer two-week trial periods while Wal-Mart offers an entire month of free service.  The good news for consumers is that the competition continues to lower prices, a factor that might favor Wal-Mart in the long run.

Ordering, shipping, and receiving:

Log on to the corresponding website, search or type in your selection, and click to order.  As long as you have availability and your title is in stock, your movie is shipped from the nearest distribution center within 24 hours.  You'll receive a confirmation email of your order with an estimated time of arrival, which you’ll also receive upon returning their product.  A few days later, your movie will appear in your mailbox, and it's yours for as long as you wish to keep it. When you're finished with your film, return it in the same envelope in which it was delivered and mail it back.  There are no hidden shipping or postage costs, everything is paid for by the online provider.

Turnaround time and Waiting:

The truth is you'll never know for certain when your movies will arrive.  Irregular time intervals are common.  Most providers advertise three to four days of turnaround time, but that's incorporating ideal delivery conditions.  Some companies do not operate on the weekends, and the United states Post Office shuts down on Sundays.  Depending on your proximity to nearest distribution center, you might lose or gain a day of service. 

Then there are the 'catches' or the fine print.  Contrary to common belief, this is not a 'first come, first served' business.  Free-trial members are given precedence to movies to 'hook them in', while established members are consequentially put on waiting lists until the film becomes 'available'.  And even when the film is available, if you're in competition with another member who has used their account 'less' than you they will be given the film first.

New Releases! New Releases!

These may be harder to come by than a trip to your local video store.  Unless you're new, there's a high probability you're going to have to wait. Pre-ordering weeks in advance will not ensure you will receive your movie on its release date, but it will cut down on your wait considerably.  This means researching release dates and planning your 'movie schedule' ahead of time—something you may find time-consuming and annoying. 

Dealing with a Profitable Business:

There's no such thing as a free lunch.  Online providers do not make money on the number of movies you watch, but rather, the number of movies you 'do not' watch.  This practice is referred to as 'limiting' your account.  For example, you might return two movies at the same time (possibly the same envelope) to find only one of your films was 'counted'.  The other might turn up the following day, or if you've managed to hit a weekend, the following Monday. The reason for the delay is the cost of shipping.  For every day providers withhold your order, they save.  Utilizing this practice on a million customers over a period of a year will net a substantial profit.

Where is my movie?

Another hazard of the business is lost or stolen merchandise.  If this occurs, some will charge you the retail price of the DVD--others realize it's a part of the business and will disregard it. The postal service is not 100% effective, but neither is dealing with a profitable business.  Customer service representatives blame the post office, and the post office blames the companies.  Logically, the post office gains nothing for holding or losing your mail; online providers save on shipping and profit.  Regardless of who is responsible be prepared for this situation sometime down the road.

Damaged Goods:

There is nothing more disheartening than to be an hour into a movie and have the screen freeze. You will encounter this often, more so than your local video store.  Thrown through the mail in a thin paper sleeve is not the best way to handle compact discs.  This is a tough issue to fix, for those who scratch their movies are obviously not reporting it, and those that receive scratched movies do not report for fear of being charged. 

If your disc is playable and freezes only on a certain frame, just skip to the next chapter of the movie and rewind to almost the spot you were on.  A pain, yes, but it's still better than dealing with possible fees and/or waiting for a replacement the following week.

Are you saving money? 

Like everything, it all depends. The key is to look at the business as a service, not as a way to save cash.  Do you already spend an excess of twenty bucks a month on movies?  Remember this is a monthly service, and if you're paying fifteen dollars a month, you’re paying $180 a year.  Factor in that you will rent occasionally from your local store when you’re “movieless”, and things really start to add up.

Overall analysis:

If you're into Kurosawa films, Sundance/Independent movies, or television DVD's, renting online can be a godsend.  But it’s far from perfect. It's still another bill, but with the slightest effort you will get your money's worth.  Having something to look forward to every few days is not the worst thing in the world, and bye-bye to due-dates and late fees is refreshing.  Add in inflated gas prices, and walking to your mailbox over the long run might actually save you money after all.  This business is still relatively young.  Whether it stays or fades, it will be interesting to see what becomes of it in the future.