Junto Boys

BLOCKBUSTER DROPS LATE FEES

I was working for Blockbuster when I got married ten years ago, so in a parallel timeline, I could be toiling still for a fading enterprise. The rentals cost three bucks, best I remember, and the late fees were substantial. In fact, the late fees were a substantial percentage of Blockbuster's overall profit.

It estimated that late fees would have contributed about $250 million to $300 million to revenue next year.

People used to bitch and moan about the fees, but I was in the business of collecting, so I could only point out that we make it very clear at checkout when the items are due. I had sympathy, but not much.

Every morning began with calls to customers on the list to remind them that their rentals are overdue and fees are accumulating. As manager, I spent time each day printing up and sending out letters to hint at the possibility of a collection agency getting involved. Sometimes, the late fees would add up to more than the price of purchase. There were always a percentage of patrons who were consistently late and happily settled upon their next visit. There were also customers who we never saw again after their first rental.

Michael Jackson came into the Orlando store one time when I wasn't working and rented a few titles which he never returned. The only one I remember was A VERY BRADY CHRISTMAS. He must have had a thing for Bobby Brady. I was the guy who had to phone his people and secure authorization to charge his Amex for the cost of the title. I wondered at the time what else I could get away with charging to Michael Jackson's Amex.

So, after I quit the job, I rarely rented movies from Blockbuster because their prices were so high. A couple of years ago, I rented a couple of titles, and returned them a day late, understanding that I would owe a late fee. Instead of the half-price penalty I was expecting, I was hit with the full-price cost of the rental. Seems their policy had changed over the years. Rather than tacking on a per-day late charge, they now simply re-rent the movie to you at full price, which gives you the full three days. I complained that I did not want to pay for three days, I simply wanted to settle for my one extra day. No luck, of course. I paid for the second rental period, but I took the movies with me so that I could return them at the end of the new rental period and the store would not be able to profit during that time by renting them to some other sucker. I have not been back to Blockbuster since.

I now enjoy my rentals via mail with Netflix. I pay a monthly fee to have three titles at any given time and I never pay a late charge, even if I keep a movie for two months, which I have done. This no-late-fee concept has really shaken the boys at Blockbuster the past few years. This year, they announced a Netflix-like mail order service, which had the delightful effect of driving down my Netflix subscription price. Now, I see that Blockbuster is doing away altogether with late fees. Of course, there is one catch...

The world's largest video rental company will still have due dates for their rental products -- one week for games and two days or one week for movies, depending on whether it's a new release. But customers will be given a one-week grace period after that to return the product. After that grace period ends, the chain will automatically sell them the product, less the rental fee. If the customers don't want to purchase the movie or game, they can return the product within 30 days for a credit, less a restocking fee.