Here we go again - another threat to the local entertainment industry. This time, says the L.A. County Economic Development Corp., it's those Redbox DVD rentals. Having them around will cost Socal 9,280 jobs and $1.5 billion in economic output. Huh? From the release:
"The economics of the motion picture industry are based on exclusive release windows which allow price differentiation - that is - some earlier transactions take place at higher price points," said Gregory Freeman, Vice President of Consulting and Economic Policy for the LAEDC. "Redbox, or any other distributor that weakens the release window model, could reduce overall industry revenues. Lower revenues will likely lead to lower production activity, hurting the Southern California economy."
The study seems to suggest that the Redbox-type kiosks will erode rental revenues and that would hurt the overall home video industry and that would lead to a loss of movie production - and that would be really bad.