RebatesHQ Gives Rebate Headache

November 30th, 2006 Davis

A little over a month ago, I made a purchase that was almost as exciting as when I picked up my HDTV TiVo series 3. After seeing Wired magazine call the Canon HV10 High Definition camcorder the best consumer high def camcorder on the market, I decided to take the plunge and splurge on an unncessary, but very hot little luxury item.

Over the last month, I’ve had fun playing around with it, but I’ve held off on writing a review of the product, in large part because I haven’t been able to actually produce my first video yet. I have been able to record in High Definition and I can even hook the camera up to my TV and watch it in all it’s HD glory, but what I haven’t been able to do is transfer the recording onto my computer so that I could edit it and make a more polished video.

In order to do this you need software that can handle HDTV signals, to go along with the hardware. Normally I would have gone out and purchased my own high definition editing software, but part of what Canon has been doing to build buzz for the camera, has been to offer consumers a free copy of the Pinnacle Studio Plus Titanium Edition with any Canon HV10 purchase before January 31st, 2007. The Pinnacle software has gotten decent reviews online and knowing a good bargain when I see one, I eagerly took advantage of Canon’s free software offer.

This software normally runs for about $100, so this is a nice little extra for them to throw in, especially because I was already interested in buying the camera. The problem with the offer though, is that instead of letting me buy the software in the store and then rebating me the $100, so I could immedietely use it, they insisted on mailing the actual software as part of the rebate. This meant that I’d need to wait a bit longer to do my editing, but I figured if I sumbited the paperwork fast enough that the wait wouldn’t be that bad.

As soon as I got the camera, I sent the rebate form, the UPC, serial number, copy of my fingerprints, a promise to give up my first born, a sample of my DNA and the original receipt in the mail. I then sat back and waited eagerly to take this baby out for a real test drive.

About a week later, I logged onto RebatesHQ.com to check on the status of my rebate and was pleasantly suprised to see that they approved my rebate and that on November 11th, it was in “final processing” status.

Knowing that these rebates get rejected all the time, I knew that this was a good sign and figured I’d be happily editing away in another week or two. When the software didn’t arrive, I checked the website again and sure enough it still said that it was in final processing. Wondering how long “final processing” would last, I fired off a quick email to RebatesHQ.com and asked them for a status update. On their site they promise to get back to me within 24 hours, but after waiting another week, an email never showed, so I did a little online sleuthing and found a telephone number for the company.

The phone number was an automated system and of course it didn’t have my information in it, but after mashing every conceivable combination of * and then a number into my phone, I finally hit paydirt and was able to get through to a live operator.

Once I got ahold of an agent, they verified that they had received the request, that everything looked great, but that they wouldn’t ship the software until December 23rd because “according to the terms and conditions” December 23rd was the longest possible amount of time that they were “technically” allowed to take.

Talk about infuriating. Here I am, just itching to use this hot new piece of tech candy, but I can’t because Canon forced me to wait for a software rebate to begin with and then the company that they hire to process the rebates, insists on doing the absolute minimum required to get the software to me. The irony of all of this is that if you go to RebatesHQ’s parent company, Parago.com, they brag about how great their word of mouth programs are and how much consumers love their service.

“Parago can help you identify the customers most likely to spread your marketing messages, and we’ll help you develop and deliver the tools to turn those “super customers” into effective marketers.”

Well thanks to Parago, they just turned this “super customer” into a super lit fuse. Canon was all set up to get some really great buzz about this camera, but because of their poor rebate decisions, it’s turned my customer experience into a nightmare. Without the software, the camera is practically worthless and while I could just go out and spend the money to buy the software instead, it’s hard for me to justify spending an extra $100 after I’ve already been forced to wait a month to begin with.

Now it’s possible that this rebate scheme could have been set up by Pinnacle or Canon to begin with, but it seems unlikely to me that either company would want to delay their customers from being able to fully use their product for two whole months after making a purchase. When I pressed RebatesHQ to explain why it would take 42 days from the time my rebate was in final process to the time it takes them to actually drop a piece of software in the mail, they only reiterated that legally they didn’t have to send it to me and that there was no way for me to escalate the status of my rebate request.

With customer service like this, it surprises me that Parago has any customers at all, let alone that they have the stones to claim on their website that they “understand the art & science of successful loyalty programs” More like they understand how to juice their customers for the highest profit margin if you ask me.

Update - I did end up getting my software, but it showed up on Christmas Eve as promised. It also seems that I’m not the only one who has run into some kind of trouble with RebatesHQ.com The company may not want you to know how to contact them, but if you have a situation that needs straightening out, I think you should go ahead and give them a live call, so here are a couple of numbers that you can use to contact RebatesHQ and Parago directly. If you find other numbers for the company or if any of these come up disconnected, please leave a comment and let me know.

877-755-3837 RebatesHQ
866-462-3944 RebatesHQ (It takes a while, but don’t push any buttons)
800-337-4849 RebateHQ
800-531-5000 RebateHQ (Main Office)
800-940-1298 RebateHQ (may only be for Amazon purchases)
800-706-5729 RebatesHQ (may only be for Dell purchases)
866-865-0241 RebatesHQ (may only be for Circuit City
888-213-9916 Parago - press 1, then 0
866-206-8800 Parago

A lot of people feel pretty strongly with how RebatesHQ is treating them. Some want to band together and form a class action, but anytime lawyers get involved things just get too messy. My advice is that if you feel that RebatesHQ is breaking the law by denying legitmate rebate requests in an attempt to discourage people from collecting on them, then you should contact your state attorney general and file a complaint. If they see a pattern of abuse, they will investigate and will rain holy hell onto Parago, if any allegations end up being true.

If you feel that RebatesHQ is engaging in morally questionable activities, by making it extremely difficult to dispute their rejections or for customers to get their rebates, then my advice is to contact the BBB and make the company file a response for their actions.

Update #2 - Thank you to everyone for continuing to comment and share information that might be helpful in getting back other people’s money from RebateHQ.com. Thanks to one of our commenters, we’ve successful determined that RebateHQ has a specific person for dealing with these rebate frustrations. While the 800 number listed above appears to be correct, my recommendation is to use the DavisFreeberg.com Hotline and get in touch with Mr. Kent Patterson, RebateHQ.com’s Consumer Complaint Specialist at (972) 538-7277. Good luck with your efforts to get your money back and thanks again to everybody whose shared their experience, for helping others avoid the pitfalls of dealing with Parago Inc.

Posted in Technology, Marketing, TV | 100 Comments »

Nintendo Wii Have A Problem

November 30th, 2006 Davis

naturevstech taken by dantetrifone Hosted on Zooomr

Console launches have always had their glitches. When Microsoft first launched the Xbox 360 they had all kinds of complaints about their boxes crashing after gamers desperately played them nearly non-stop in the first few weeks of the release. At the time, Microsoft said that this was a problem that would really only affect the most hardcore gamers, but with the recent release of their HDTV downloads, I can’t help but wonder if we’ll see more reports of Xbox failures as users are required to keep their Xbox 360’s on during the entire download process. My own Xbox 360 has already started having power issues and I know that Thomas Hawk has been forced to send his back under the warranty after it had a heart attack and died on him for good.

Sony’s of course has had their own problems with the PS3. Never mind the miniscule number of boxes that they ended up shipping or even the complaints over the PS3 being the highest priced video game system ever, after a very limited launch, Sony has still seen reports of their own console failures in the wild.

With so many problems surrounding the launch of consoles I guess it shouldn’t be a surprise that Nintendo is having problems of their own. The only difference though, is that Nintendo’s problem isn’t because of a faulty game system or limited supply, it’s because their game system is so freaking engaging that Wii owners are having a problem keeping the controllers in their hands. Because of this, Wii owners are finding that when they go to slash a monster in Zelda or smash an ace while playing Tennis, that they can end up throwing their controllers across the room and are breaking their TVs as a result.

Now to be fair, part of this problem is caused by Nintendo because their wristband for the controllers have had reports of breaking pretty easily, but to a certain extent gamers only have themselves to blame when they can’t keep a grip because they get so excited. Wii Have A Problem has set up a website where they are documenting photos of people who have already destroyed their TV sets. While I do find the photos a tad bit funny, at the same time, it’s pretty sad because if you Xbox 360 or PS3 broke down, then you could always get it replaced, but if you break your TV it can cost you thousands of dollars to replace it. Hmmm maybe that Wii isn’t looking so inexpensive after all.

Posted in Technology, Video Games, TV, Microsoft | 3 Comments »

DVD Kiosk Industry Heats Up In Hot’Lanta

November 29th, 2006 Davis

Atlanta’s Newest Release taken by the Spacey Gracey Review Hosted on Zooomr

Atlanta has always been known for their Southern hospitality and charm. The city boasts four professional sporting teams, a vibrant R&B and hip hop scene and of course peaches that make you drool just thinking about them. With the city being known more for it’s leisurely pace of life, then the breakneck speeds that seem to characterize the tech industry, one wouldn’t think that Atlanta would be at the center of one of the hottest shifts in the movie industry right now, yet the city finds itself in the enviable position of being caught in the intersection of two DVD kiosk rivals in the rapidly changing DVD rental industry.

According to a recent press release, TNR Entertainment has yet again raised the stakes in the DVD rental industry by announcing that they’ve successfully installed 170 new DVD kiosks in the greater Atlanta area.

With Redbox currently beta testing DVD kiosk rentals in Atlanta area Walmart stores and with TNR Entertainment now having completed the first stage of their recently announced expanded partnership with Krogers, consumers lucky enough to live in the Atlanta area, will have two more DVD rental companies fighting for their entertainment buck.

At $1 per DVD rental per night, renting DVDs from a kiosk not only fills the instant gratification factor of wanting to get a DVD right away, but it does so at a very affordable price.

In comparing both Redbox and TNR Entertainment, Redbox has the leg up if customers are bad about returning their DVDs. Redbox caps the maximum price for a DVD at $25 after 25 days, compared to TNR’s $35 DVD purchase price if you keep your movie over 14 days. Redbox also offers online reservations that allow consumers to pre-order movies before going to the store, while TNR is still implementing their own webervation system. Of course with both companies charging the same price, the biggest differential will end up being the convenience factor and with TNR’s Kroger expansion, it will mean that TNR will now have approximately five times as many locations in the Atlanta area.

This convenience factor may be the ultimate test for whether or not Atlanta residents will choose one over the other, but frankly I think the market is large enough to support both. Whether one firm wins market share over the other or whether both companies will see success in their Atlanta endevours remains to be seen, but either way the real winner will be the consumers who now have even more options to choose from in how they rent their movies.

The expansion by TNR Entertainment is only the first step in an ambitious plan to add 1,300 DVD kiosk locations to 25 different markets over the next several months. With the rollout of the new DVD machines now well underway, TNR expects to have their rollout completed by early next year.

Over the last few years, Kroger has been very coy in their experiments with DVD kiosks and have been playing both TNR and Redbox against each other for supermarket contracts. Earlier this year, the company forged a deal with Redbox to add DVD kiosks to their Smith’s subsidiary, but then just six months later they awarded a more impressive contract to TNR for the 1,300 locations in their main Kroger stores. While these moves may represent, a desire on Krogers part to keep their DVD options open, it also could reflect a more optimistic reality that neither TNR Entertainment nor Redbox have the capability to fill all of the demand that they are seeing for their DVD solutions.

With Kroger having over 20,000 potential locations, Walgreens operating 5,000 pharmacies, Walmart adding another 4,000 potential opportunites to the equation and Safeway, who’s been using DVDplay for their kiosks, having another 1,800 stores, you can start to get a sense of how large this industry could really get, just through organic growth amoung existing partners.

If you also consider the potential of what could happen if Starbucks decides the right formula for adding their 8,000 stores to the mix or if Target wants to open up their 1,500 locations to DVD burn on demand kiosks or if McDonalds takes this industry international and puts a Redbox in all 31,000 global McDonald restaurants, then you can start to get a picture of how quickly this industry could actually explode. While not every retailer will adopt the DVD kiosk strategy and certainly not everyone will be incorporating them into every store, TNR’s further expansion into the Atlanta area only highlights the real underlying demand for this technology.

While we haven’t seen much direct competition in the DVD kiosk industry to date, Atlanta may very well be an important testing ground for both Redbox and TNR Entertainment. If consumers in Atlanta embrace both solutions, then it will bode very well for the industry. If we see that the head to head competition actually affects sales, then I expect that we’ll see the equivalent of a modern day gold rush, as both firms rush to stake their claim on each city before their rival gains a foothold. Either way though, I don’t see the expansion of this market slowing anytime soon, which means that consumers across the entire US may soon find a DVD kiosk coming to a neighborhood located near you.

Posted in DVDs, Kiosks | 6 Comments »

Back To The Lake

November 28th, 2006 Davis

Posted in VOD | No Comments »

Comcast Exploits SF Monopoly - Juices Customers Yet Again

November 27th, 2006 Davis

Every year, around November, Comcast likes to increase the cable rates in the San Francisco bay area and this year is no different. Nevermind that over the last four years, Comcast’s increases have easily outpaced inflation. Because they have a near monopoly on the bay area, they are able to raise rates with little fear of competition. They are able to do this largely because the city of San Francisco granted Comcast a four year exclusive license on all cable TV services just a year ago. The price that Comcast had to pay for this exclusivity was a mere .80 per subscriber per month. A small tax compared to last years 6% increase or the $3.30 increase that I’ll be seeing on my own bill come January 1st.

What makes this increase so intollerable is that they are going after the standard subscribers. These are the pesky cable subscribers who refuse to pay for their digital cable package because it is a complete ripoff. If you agreed to pay an insane amount of money for Comcast telephone service, then they don’t increase your fees, but for those of us who want to use prepaid cellphones, skype and cablecards, we’ll now be forced to pay more so that Comcast can pay for VOD services that they won’t even provide to cablecard customers. Just when I figured out a way to get rid of the bogus $5 HDTV charge by using cablecards, Comcast figures out a way to get their money back.

What’s funny about this upcoming rate increase is that no matter how much changes the story still remains the same. Three years ago, when they increased rates, it was because they were planning on making a $400 million investment over the next two years. Two years ago, they justified their rate increase because upgrading equipment cost them $600 million over the prior two years. Now they need to increase rates another 6% because they want to spend $200 million to move their SF headquarters and they need to make sure all of their employees get parking spots.

I guess, if Comcast was a struggling company in a market where they had to fairly compete I’d feel more sympathetic, but meanwhile, Comcast earned $1.2 billion in profits after taxes over the last quarter alone. Comcast may want to defend their decision to increase rates on more upgrades, but the truth is that they realize that they will soon face competition from Verizon and AT&T and they want to juice their monopoly one more time before competition starts setting in.

Normally, I wouldn’t even mind a fee increase, but because of their monopoly over the citizens of San Francisco, I’m left with a choice of either setting up the bunny ears or paying whatever Comcast wants to demand for my TV. Meanwhile, the very board of Supervisors that sold this lucrative monopoly to Comcast for a song is now fighting the implementation of free wifi to the tooth and nail. A move, which would at the very least limit Comcast’s ability to overcharge for broadband access.

The cable market in San Francisco is seriously broken and needs to be fixed. While I don’t expect the local politics to change anytime soon, I can at least take comfort in knowing that the State of California has stepped in to make it easier for competition to flourish. It may take a few years for the telecoms to build out their services, but once we have a choice beyond just Comcast, we’ll see an end to these rate increases and better services for bay area customers.

Posted in Media, TV | 3 Comments »

5 Ways To Fix TiVo’s Suggestion Box

November 27th, 2006 Davis

What can I say, I’m a sucker when it comes to recommendation technology. I hate having to make decisions and one of my favorite features on TiVo is their suggestion technology that helps me find programming instead of making me go out and get it. While their suggestions are far from perfect, I still find TiVo’s suggestions to be right more then they are wrong and use the feature all the time to find programs I’m interested in.

Because TiVo suggestions always have the lowest priority on my hard drive, I’ve found that I can use their suggestions as a way to tell how much free space I have left. Fortunately with a 750GB internal weaknees drive installed, I’ve typically got more space then I need for my favorite content, but it’s still a nice indicator to have. (right now my TiVo Series 3 is recommending a little over 200 suggested programs)

When TiVo first introduced TiVo suggestions, it didn’t take me long to figure out the mojo behind their recommendation algorithm. Since then, I’ve adjusted how I rate shows, in order to maximize the benefit from the TiVo suggestion feature. Basically, pretty much nothing gets three thumbs up because it means that TiVo will focus on that program and give me a less random lineup of potential shows that I might like. I’ve also noticed that their algorithm gives a heavy weighting towards programs that I actually watch, instead of what I tell it I think that I want to watch. When I recently watched a Perry Mason film that TiVo had suggested to me, I noticed that for the next few days, TiVo went on to suggest several other Perry Mason films that aired as well.

I like this aspect of the TiVo suggestion program because it looks beyond what I’m telling my TiVo and instead focuses on my actual television habits.

As much as I like the TiVo suggestion feature though, there is still quite a bit that they need to do before they perfect the system. After thinking through all of the things I like and don’t like about the TiVo suggestion feature, I put together a list of the top five ways that I think TiVo can improve their suggestion box.

Suggest More Time - What can I say, deep down inside I’m your typical red blooded American male. Football, Basketball, Boxing, pretty much any sport, with the exception of Baseball, and I love it. One of my favorite things to do on a Sunday afternoon is to crack open a few cold beers and watch the last quarter of every football game that was recorded over the weekend. By and large it doesn’t matter who’s playing who, whether it’s college or pro, as long as it’s a close game, it keeps me interested.

Most of the time, I tell TiVo to record these games manually, but because I watch a lot of sports, their suggestions have learned to automatically record sports too. Now normally this would be a good thing, but unfortunately most sports go way longer then scheduled and TiVo suggestions will always cut off the end of a game. Because you can’t tell if the end of the game is cut off or not without spoiling the program, I pretty much ignore TiVo when it suggests sports because nothing is more disappointing then to invest 3 hours of your time into a game, only to discover that it went to overtime and you don’t get to see the end.

I’m not sure why TiVo suggestions don’t pad for overtime, but TiVo should build a feature that automatically adds extra time to live events. They could leave the length of time up to the user to determine or set a default depending on the sport, but with football and basketball games almost never finishing on time, this would vastly improve the customer experience when they suggest sporting events to their subscribers.

Suggest New Shows - One of the problems with TiVo’s suggestions is that they put too much weighting on the thumbs ratings and not enough on finding new programming. Because of TiVo’s suggestions I’ve found shows like the Jamie Kennedy Experiment and Reno 911, but most of the shows that get recommended aren’t new programs I’ve never heard of, but rather reruns of CSI: Miami.

TiVo should build a feature that allows users to automatically exclude programs they’ve rated. This would be especially helpful when it comes to recommending movies.

When it comes to movies, TiVo suggestions almost never record something unless you’ve rated it to begin with. The problem is though, that if I’ve already rated a film, it likely means that I’ve already seen it. With so many new films coming out each week, I’d love for TiVo to recommend films that it thinks I’d like, but isn’t sure because I haven’t rated it. By allowing me to limit the TiVo suggestions to either no ratings for everything or no ratings for certain genres like movies, it would cut down on the number of repeats it records and offer me programs that I may have never heard of before. This may decrease the relevancy of their suggestions, but it would increase the number of new programs that it would recommend and it would help me find high quality programming that I might be interested in subscribing to a season pass for.

Refine Suggestions - One of the biggest problems with the TiVo thumbs up rating system is that many of the ratings are based on pretty broad programming choices. For example, I generally hate baseball, but I love watching the Mariners play. Unfortunately though, there is no way for me to tell TiVo that I want to give baseball three thumbs down, but to give the Mariners three thumbs up. I’ve either got to tell TiVo that I love all baseball or hate all baseball. If there was a way to designate favorite teams, TiVo could then suggest Mariner games, but would also know that if it suggested a Yankee game, that I’m liable to put a baseball through my TV screen.

The same is true for movies. I love watching a good action flick, but if it has Steven Seagal or Jean Claude Van Damme in it, then I really have no interest in seeing the film. I’d love to be able to refine my ratings down to the genre, director and actor level, so that TiVo could then suggest films that have my favorite director and movie stars in them, instead of recording Short Circuit 2 again. (Johnny 5 is definetely not alive in my household) By letting their users give more information to TiVo, it would allow for more sophisticated algorithms and better relevancy when it comes to suggesting shows and movies that have never aired before.

Don’t Suggest Repeats - I’m much less interested in seeing a repeat of a show then I am in finding new content that’s out there. Just like I can tell TiVo to only record first run episodes of my season pass programs, I wish that there was a way to tell TiVo to quit suggesting repeats. While this would limit the number of programs that the unit would suggest, it would also ensure that I’m finding fresh content instead of stale episodes of CSI and Law & Order that I’ve already seen a million times. By allowing users to limit the programing only to new shows, it would help to make the TiVo suggestion feature feel new and exciting and improve the user experience for those who’d rather have fresh content, then an endless stream of shows that we’ve already seen.

Make Suggestions Social - Television is a special medium. People might argue that television leads to anti-social behavior, but because of it’s influence on society there are certain shows that create a water cooler effect around them. These are shows that you enjoy watching, but you enjoy talking about them even more. It could be that TV shows give us a common ground to communicate on or that they are just so entertaining that we feel compelled to share the experience, but regardless, when you can talk about a show, it extends the appeal of the programming beyond the 30 minutes that you spent watching it.

One of my problems though, is that a lot of the shows I watch aren’t always the most popular shows on TV. In fact, some of my favorite TV programs are the ones that none of my friends have ever seen. It may be that they are too busy or it could be that it’s the wrong genre to appeal to them, but more times then not it’s because they haven’t taken the time to check out the program.

As more and more people network their TiVos and as microcontent begins to become available on the platform, I believe that word of mouth is going to become an increasingly important tool in helping to spread the popularity of these niche shows. If there was a way for me to tell my TiVo to suggest certain programs to a friend’s TiVo’s, then TiVo could help to facilitate this word of mouth phenomenon. By letting my peers suggest programming to me either based upon what they know about my personality or automatically based on their season passes, TiVo could help to make TV more social. While creating buzz around the top Thursday night shows isn’t a problem in the workplace, when it comes to video logs, niche cable channels and podcasts there is a huge vacuum in this area. By giving tools to their customers to classify and recommend these niche programs, TiVo could make it even easier for people to find good quality content that’s relevant to their own lives and the lives of their peers.

Not everyone likes TiVo suggestions and it’s probaby a good thing that TiVo offers their users a way to opt out of this feature, but as an avid TV watcher, I can tell you that TiVo’s suggestions is one of the greatest things about owning a TiVo. When it first came out the it was fresh and exciting, but with more efficient recommendation systems being developed, I’ve been a little disappointed to see such little progress on TiVo’s own recommendation algorithms.

Before I got the series 3, I had hoped that with my upgrade to the new box, there would be significant changes in their algorithms, but after using the series 3 for a couple of months, I still feel like it’s the same technology that was in the series 1 box. With an explosion in the amount of content being created, it will be the aggregators that can filter these choices the best, that will win the digital home. While TiVo is clearly not leading in this aspect of search technology, by implementing some of the changes that I’ve suggested, along with an even more powerful algorithm, I believe that they can make this feature feel fresh and exciting again and help their customers find relevant niche programs in the process.

Posted in TV, Disclosure - I own stock in co. mentioned, TiVo | 4 Comments »

And The Winner Of The Turkey Award Goes To . . .

November 23rd, 2006 Davis

Picking out the winner of the first annual Turkey award wasn’t an easy task. Over the last 12 months we’ve seen quite a few scandals stir up the blogosphere into a full fledge gobblefest and narrowing it down to just one incident seemed like an impossible task with so many memorable gaffes.

There was Kramer’s bizzare and angry rant against a heckler, Ex-Senator George Allen’s use of a racially charged term to help him lose a tight election. There was even the Cartoon network’s attorneys who issued a cease and desist against their own marketing department after they uploaded viral clips to YouTube.

While all of these would have made for good Turkey awards, none of the them can top the fallout that occured after AOL publically released intimate details about what their members have been searching for on their site.

That’s right because of the incident that the EFF dubbed Data Valdez, AOL is this year’s winner of the Turkey award. Thanks to AOL, when we’re sitting down with our families today we can take comfort in knowing that someone out there is likely planning a murder online, the most searched word on AOL is free and that college students love to use the internet to cheat on term papers.

Thank you AOL for making our lives more entertaining by violating the privacy of your subscriber base.

Posted in Media | No Comments »

Would You Like A DVD With That Mu Shu Pork?

November 22nd, 2006 Davis

This must be the year of the dog for Blockbuster because despite recent denials that they are not looking to sell off their international operations, it’s beginning to look like they are walking away from the international markets with their tail tucked in between their legs.

Less then a week after the company denied that they are trying to sell off their international properties, we’ve seen the company abandon their affiliate program in the UK and now Digitimes is reporting that they’ve sold off their Taiwanese Blockbuster locations to Taiwan based Webs-TV.

Webs-TV wouldn’t confirm or deny that a deal has taken place, but Digitimes has said that the acquisition will be for all of their stores in Taiwan, as well as the rights to use Blockbuster’s name and trademark in the future.

The good news for Blockbuster is that they’ll have one less division bleeding losses at an alarming rate for the company, but the bad news is that next year is the year of the Pig and Blockbuster may get slaughtered as the loss of revenue from their international operations continues to impact their flexibility in a rapidly changing industry.

While I’m sure that Blockbuster will likely point to issues with piracy as their motivation for leaving Taiwan, I see their struggles in Taiwan as an early indicator of some of the challenges that Blockbuster will face in the US markets as the digital revolution makes it way past the DVD and through the net.

While DVDs and the video stores still have some life left in them, there is little doubt that media is moving away from the stand alone video store business model and towards direct distribution over the internet. Will Blockbuster be able to innovate fast enough to stay in the game? Only time will tell, but thus far they’ve invested in Cinema Now and have spent a tremendous amount of energy in promoting their own online competition to Netflix, yet so far they’ve gained relatively little traction from these moves. The company has done a good job at cutting costs over the last year, but at some point it will become increasingly difficult for the company to cut costs fast enough to keep pace with the number of video stores going into the red. While an early exit out of Taiwan may help focus Blockbuster’s business on the US markets, I question what Blockbuster plans on doing once the same pressures that they face overseas begin to happen domestically.

Posted in DVDs, Disclosure - I own stock in co. mentioned, Netflix | 3 Comments »

It’s Good To Be The King

November 21st, 2006 Davis

I’ve never understood the appeal of Burger King’s bizarre marketing campaign that features the king stalking various people, but I’ve got to say that I found this spoof on the ads pretty funny. While it’s probably a little edgy for Burger King to have made themselves, I enjoyed it a lot more then the original ads, that plain freaked me out.

Posted in Marketing, VOD | No Comments »

A Television In Every Home And A Redbox In Every Albertsons

November 21st, 2006 Davis

Redbox continues to make in-roads into the emerging DVD kiosk market after Video Business reports that the company has signed an agreement to put a Redbox DVD rental kiosk into every Albertson’s store by the end of the first quarter of 2007. Albertson’s currently has a 100 Redbox machines installed in their Texas based stores and this expansion is an obvious sign that they’ve seen a positive impact from adding the kiosks to those stores.

Albertson’s has been my favorite grocery chain ever since I moved to Alameda two years ago and had an opportunity to experience their self checkout solution. While many customers still prefer having someone ring up their purchases and bag their groceries for them, I loved being able to ring up my own groceries and then quickly leave the store without having to make idle chit chat with store employees.

Because of their automated checkout system, I would specifically shop at Albertson stores when I lived in Alameda, even though there were more price sensitive grocery stores that I could have used. Albertson’s enhancement of their Redbox agreement, takes this automation philosophy one step further and makes it even more convienent for customers to get their errands done, by letting them rent movies quickly and effectively when they are doing their grocery shopping.

In addition to the expansion of Redbox’s Albertson agreement, the company also announced that they will be supporting four more independent grocery stores chains with their DVD solution. According to the Video Business article

“by January, all 130 Northeast U.S. Hannaford outlets will have Redbox kiosks. The 20 to 25 Strack N Van Til chain, located in Indiana and Illinois, will get machines by the end of this year. Already housing Redbox machines are Maryland’s single-store retailer Chevy Chase and the 18-store Indiana-based Martin’s.”

Between the expansion of Redbox’s current DVD contracts, the testing by Walmart in their Atlanta based stores and the recently announced trial relationship with Walgreens, Redbox is on pace to make 2006 a record year for the company.

Over the last 12 months they have seen the number of kiosks offered double and have their sights set on eventually reaching 20,000 locations nationwide. While at this stage, their kiosk solutions are only designed to fill spontaneous short head demand, I can’t help but wonder if at some point we’ll see the company launch their own DVD by mail program and offer a solution that not only fills instant gratification needs, but can also fill niche longtail demand for more obscure titles. Only time will tell if Redbox goes in this direction, but it would be a natural compliment to their business model and as the company develops a national footprint it could provide real competition to Netflix’s dominance of the DVD by mail market.

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