The Last (DVD) Picture Show

The practice of heading to a physical video store to rent DVDs (and, before them, VHS tapes) — which had been sputtering along throughout the back end of the aughts — pretty much died for good around the time that Blockbuster officially folded in 2013, did it not?

As it applies to a majority of the United States, that’s a fair assessment.

In the at-home movie rental retail game, the upgrade in format from analog-based VHS tapes to digitized DVDs actually portended the demise of tactile video entertainment media, given that the core technology of DVDs themselves — the storage and transmission of videos in digital format — gave rise to streaming media services, such as Netflix, Hulu, Amazon Video and all the rest, which largely define the marketplace today.

For most U.S. consumers who remain holdouts, to varying degrees, in adopting streaming media and still get their at-home video entertainment in DVD form, their tactile media rental needs are not met “in-store” as much as they are “at-kiosk” — i.e., at freestanding Redbox locations commonly placed just outside of convenience stores or in the entryways of supermarkets. (And even that business model, as a recent Cinema Blend story observes, has begun to experience a decline similar to that which ultimately felled Blockbuster.)

The bold-yellow-lettering-on-blue-background-adorned movie rental stores that dotted the American landscape throughout the 1990s — Gothamist notes that, as late as 2004, there were around 9,000 Blockbuster locations in business across the country — now number a scant 51 independently operated franchises. The one-time home entertainment titan has, more than a little ironically, effectively become a member of the retail class for which it was largely responsible (with help from other chains, such as Hollywood Video — also now defunct) for putting out of business: the mom-and-pop video store.

However, despite the prevalence of streaming services and Redbox — as well as the lucrative business of pirating on BitTorrent sites, which, despite being illegal, were earning approximately $227 million annually (mainly from hosting fees) as of 2013 — having turned the video store into what Tom Roston, in his book “I Lost it at the Video Store,” called (as the Gothamist story shares) “an anachronism lurking in the looming shadow of the Internet,” it is not the name brand-affiliated locations that are thriving (relatively speaking, of course) in specific corners of the world, but rather the movie rental (and sales) shops that have been independent from the start.

What is the force that is managing to keep these outliers alive? As is the case with any specialty retailer — such as Amoeba Music in California, which continues to flourish after outlasting physical music retail monoliths, like Virgin Megastore and Tower Records — it’s a mixture of nostalgia, the value of person-to-person experience and, in a number of instances, location.

In a lengthy exploration of the history of physical video retail and how some mom-and-pop stores managed to thrive both during and after the demise of the big chains, Flavorwire shares how consumer affection for the “old way” of doing things has furnished the continued success of stores like Video Free Brooklyn, Videology (also in Brooklyn), Vulcan Video in Austin, Texas, and Vidiots in Santa Monica, California. So strong is the desire to maintain the tactile experience of video rental in Seattle, in fact, that the city’s once-struggling Scarecrow Video has found new life as a Kickstarter-funded nonprofit. (Money is money, however a retailer can get it.)

Although the number of video stores in the United States (as the Flavorwire story notes) has dropped precipitously, from approximately 30,000 in 1989 to around 6,000 at present, the surviving locations are not — as a cynic might presume — exclusively found in major urban markets and kept afloat by self-satisfied cinephile hipsters.

On the contrary, factors such as the higher quality (compared to streaming) of DVDs (in particular the Blu-ray format), the availability of new releases before they reach services like Netflix and Redbox and a deeper catalog of titles are keeping mom-and-pop video shops alive and well in areas as diverse as Durango, Colorado, suburban New Jersey and small-town South Dakota.

As Keith Hoogland, owner of Family Video — the oldest (and last-standing) video chain in the United States, which has grown from 400 locations in 2004 to 777 today, primarily in the upper Midwest — remarked to Flavorwire: “The video business is still cranking. It’s not the same as it used to be. Redbox has taken a little bit. Streaming has taken some, and Netflix took some. But we got a big bump when Blockbuster and Movie Gallery [formerly Hollywood Video] closed; that brought us back up a little bit. So, overall, we’re a little bit down over the biggest days, but boy, when you go in our stores on Friday and Saturday night, we’re absolutely packed.”

“We’ve been saying since 1980 that the video industry is going to last at least another five years because we didn’t know, and we’ve been saying it for 35 years,” added Hoogland. “But I’ll say this: I think we’ll still be here in five more years.”



The How We Shop Report, a PYMNTS collaboration with PayPal, aims to understand how consumers of all ages and incomes are shifting to shopping and paying online in the midst of the COVID-19 pandemic. Our research builds on a series of studies conducted since March, surveying more than 16,000 consumers on how their shopping habits and payments preferences are changing as the crisis continues. This report focuses on our latest survey of 2,163 respondents and examines how their increased appetite for online commerce and digital touchless methods, such as QR codes, contactless cards and digital wallets, is poised to shape the post-pandemic economy.