I just got back home from a weekend trip to see my family in Chicago and was asked to answer a few questions to which I am not sure I have the correct info.

My brother and his wife have decided to go into the private sector and to my surprise portion of their business will be dvd-renting. My brother asked me to answer a few questions (he is as big of a dvd enthusiast as I am) but I am not sure I know much about the field. Also, I won’t be able to share what the focus of his business will be (at this point only) as he hopes to be the first one in the field. I hope that this is OK with those of you that decided to answer my questions. So, here they are:

1. The store will be divided into 3 levels and one of these sections will offer collectors items and dvds for rent. Now, he does not know if he needs to sign a license contract with someone that will supply him with the new releases (I mean mostly main stream titles). Any suggestions?
2. Does he need to pay per title or per copy of a specific film that he’s going to have on his shelves?
3. Awhile ago there was a person that bought a store on this forum and there was a thread with a lot of information. Many recommended adult titles- is there a difference between renting VHS (adult) and DVD (adult) titles? How do you supply them? Through the general distributor again or by obtaining them on your own?
4. In principle, are non-region 1 dvds OK to be rented in the States?
5. Are imported dvds (not bootlegs!!!) without English subs allowed to be rented or not-Russian dvds for example?
6. Ordering directly from the Internet (and therefore lowering the total average per dvd title) and putting the dvds on your store’s shelves- Is this legal or not? Or do these titles need to be obtained through a rental distributor?
7. Does he need to register the store with any of these copyright privacy groups (or the state for that matter)?

I would like to thank in advance to anyone that could answer these questions for me as my brother’s family has everything in a rather advanced stage (much to my surprise) and I simply am not familiar with many of these issues. I also want to make it clear that this is not me going into the renting business though my family relationship is more than obvious here.

On behalf of my brother-
Thank you so much for your info in advance and I look forward for some additional suggestions that you might have (based on the little information I have provided so far).

Cheers,
PB

anyone want to attempt to answer my questions?

http://www.vsda.org is probably a good place to start.

Thank you so much Mike......any other suggestions?

ok, this is how I understand it. Its certainly the way it works here in the UK, and i'd be suprised if its much different in the states.

With regards to renting DVDs, the way to do it is to contact industry suppliers (Norwalk are a good example) and they supply you at industry prices, some way below what you would pay online.

Often though, there are different price depending on whether or not there is a specialised 'rental' version of a title. As an example, Daredevil. As a new release, Daredevil might be $29.99 to retail, but the rental version might cost you more that $50. And though this might suck, if you wanted Daredevil in your store, you have to have the rental one, as there are warnings all over the retail one saying 'not for rental' etc.

I have a friend who owns a small "Mom and Pop" video store. He simply buys new releases Tuesday morning from Best Buy at 10:00 AM and has them ready to rent when he opens his store at noon.
I'm sure this is illegal but he has been operating for at least five years without problems. Not that I'm advocating this, merely informing.

You have to buy special licensed "FOR RENT" versions. You can't just buy a $20 DVD and rent it out.

Sometimes they're upwards of $100.

It's a venture, to be sure.

That's what I am having a problem figuring out...I am aware that there are whole-price distributors but I am told that if you are a rental outlet you need to pay per title.

Could anyone shed some light on this issue for me....what is the procedure that needs to be followed?

Who are the authorized distributors that one needs to sign a contract with?

**
Thank you for the information guys!

Baker & Taylor is one such company:

http://www.btol.com or

http://www.btol.com/retail_movies.cfm

Ingram Entertainment is also another major distributor in the states http://www.ingramentertainment.com/

mcraver:

I just got off the phone with one of Ingram's representatives and was told the following:

Since there is no existing "rental-dvd pricing" you are not required to have a distribution deal with any of these companies (as it was the case back in the days of VHS rental pricing...which still exists by the way). I was told that essentially "you are on your own finding the best possible price for the product" and putting it on your independent store's shelves. Is this really the case or was this guy without a clue....(which I highly doubt since he has been with Ingram since the "VHS days"). Furthermore, I was told that the only reason one would want to sign a contract with such a distributor is to get the new releases on time, speaking of mainstream titles mainly, and sometimes get screeners to determine whether or not the store will be needing a specific title. Of course, he told me about the competitive pricing they offer as well.

Any comments on the info I was given?

It is a bit different in other countries (UK or Japan for example), but in the US and Canada, a store owner is free to buy DVDs from either video disributors or at a retail store or online (if he finds a good price on something). Unlike VHS, there is no such thing as rental pricing in the US for DVDs. So, basically the guy from Ingram gave you pretty accurate info. Generally speaking, imported DVDs should not be a problem to rent here, especially if R0, but renting discs specifically encoded in another region (or having a notation on the packaging saying "for sale or rent in x only" where x represents a country other than US) is more of a grey area and could be problematic. I'll give you an example:

My parents used to have a video store (pre DVD) and on a trip to the Phillipines, I picked up a legal licenced prerecorded VHS of Jingle All the Way that for some strange reason was released in that country earlier than in North America. I let my parents put it on the shelf to rent out because no other stores had it for rent here yet but someone must have seen it and blew the whistle. Someone ended up contacting 20th Century Fox and they asked the police to come in to our store and confiscate the tape. We didn't get in trouble or fined or anything because it was a one time thing, and the tape wasn't a bootleg (we just got warned not to do it again). This is something that might happen if your brothers store carries something like a film from a major studio meant for another region. Obscure foreign or independent films released on DVD in another country will most likely slip under the radar (but still might not be technically legal to sell or rent here).

The adult video business has many of their own distributors that stores can buy product from (but renting adult DVDs can have its own legal problems. Your brother should make sure of the legality of that in his community).

Cultshock:

Thank you so much for the info!!!

None of the foreign movies he (my brother) intends to rent will be major productions. In fact some of them wont even have English subs (ABSOLUTELY NO BOOTLEGS....100% Polish films for example).

As to the adult titles he will have to find out for sure since I have no idea what the area "legal requirements" are.

Thank you again.

cultshock:
"The adult video business has many of their own distributors that stores can buy product from (but renting adult DVDs can have its own legal problems. Your brother should make sure of the legality of that in his community)."

Could you direct me to some of these.....

I wonder if the US will eventually get on the rental "laws" for DVDs. I remember when I got my R2 of 28 Days Later it had a whole warning screen about "this DVD is not for rent. If you rented this DVD contact so-and-so." Obviously the UK is keeping tabs, or trying to, on the DVD rental business. Seems that now is a good time to get into it in the US, would cut your costs alot.

Pro-bass., with the adult rental legalities cultshock might be referring to the different obscenity laws in different communities. Also what can be rented to 18 year olds and what can only be rented to 21 and older and the legal issues of proof of ID. Atleast, that is my guess as to what he is referring to.

"...100% Polish films for example..."

...well... I've found that a lot of Polish DVDs of "100% Polish movies" (e.g. Andrzej Wajda's films) do indeed feature optional English (and German, French, Russian, etc.) subtitles (feature only, extras are not subtitled)...

. . . . . .

fnordboy: I think that there are way too much money to be made here in the US...much more than in the U.Kingdom as far as DVD sales. So, I dont think that that the "majors" will go back to the old model of rental regulation. I might be wrong however...I dont know.

As to the community my brother lives in...I dont have too many impressions but I assume that standard "18 years-old- only" requirements (ID, etc) will be needed. He will have to make sure with the local authorities and decide how to proceed.

Hendrik:
I just gave an example....but I agree with what you say as well. He will be going for more obscure productions however....or so I guess, I really do not know his plans that well at this point.

Sorry, my parents' store was in Canada, so I have info on Canadian adult video distributors but that wouldn't be any use to you (they wouldn't be allowed to sell to retailers outside of Canada).

Fnordboy was correct in what I meant by legalities. For example, the legal age could be 18 in one town and 21 in the the next town over. Also, the whole "community standards" law regarding what constitutes obscenity can be tricky. You really have to know your local laws if you are going to deal in adult material, just to protect yourself.

I checked into this last year with a company called Waxworks Online, www.waxworksonline.com and according to their CSR there is no exclusive contract needs to be signed with any distributor, but in order to be guaranteed adequate supply of new releases its best to have a contract with a distributor.

I also asked them about the legalities of renting out my "consumer" purchased DVDs and this is what the CSR said, "You could rent out the consumer purchased DVDs until you get caught by the MPAA and at that point you would face stiff fines and possible imprisonment." I asked how one would get caught and they said most likely it would be one of your competitors that suspects you of doing this would turn you in to the MPAA for an audit.

And yes rental copies of the DVDs do cost more for the most part between the ranges of $50 - $80 for EACH DVD, not per title.

I am a bit confused here,

If there is no rental-window practice in existence and therefore the distributors are selling you the exact same product for the exact same price (give or take a few %) as any other store down the street how would the MPAA differentiate "rental" product from "regular consumer" dvds. This just does not make any sense.

If there isn't an existing rental policy that regulates the pricing and the way these dvds are sold it is a moot point to begin with trying to sell a new release for 50-80$. Are you trying to imply that Blockbuster is paying such a price (or say a bit lower than that with the distributor's discount they would get for large quantities). I dont think so...I dont think any independent store paid 80$ PER DVD of the Matrix-Reloaded. By the time they make their money back....they will be out of business!! Period!


ps
For example....it says right here:

for rental use pre-order the League of Etraordinary Gentlemen- 27.98-basic price before discount.
http://www.waxworksonline.com/

That CSR is out to lunch. All of that information is completely false. Rental priced DVDs exist in the UK, Australia and Japan for example, but there are laws in the US that prevent such split pricing from being implemented by studios here. A rental store pays approx the same wholesale price for a DVD that a retail store does.

Just a quick addendum to the issue of renting imported discs. There was an interesting article at Videobusiness.com about a number of video stores that rent/sell imported DVDs (eg. Cinefile in LA or Kim's in NYC). As far as legality of those discs:

One disc that raised some concern was the British DVD of 28 Days Later, that was available at the above stores for rent while it was still playing in US theatres. Fox's reaction:

So the bottom line, imports are legal to sell/rent here for now, but the studios would like to change this and will be seeing what legal avenues are available to them (but this will be mostly an issue with foreign films that a major studio aquires US distribution rights to).

cultshock:

Thank yuu for the very interesting info. Makes a lot of sense.

On a side note...I am simply AMAZED how when it comes down to money and profits it is always, ALWAYS, the US companies that try to change the existing status quo so they could be at the higher end so to speak. This is one of the twisted visions about our outcry regarding free trade. Here's what I mean:

28 days later just happened to be a British film that the Brits put on the market JUST AS EVERY US FILM (IN 99% OF THE TIME) COMES TO THE US MARKET- months before its European release, or Asian, or African, etc. So, with other words let's have free trade....but as long as we are the ones that control it and have the market monopoly. These double standards make me sick!!

Instead of crying out like babies the US companies should have paid the requested amount of money so they could have somewhat similar dates with the British market (cinema-wise) and therefore closer street dates for the dvd both in Europe and the US.