Redbox Codes

DVD rental kiosks have stormed the marketplace with much success. But a single ingredient in the kiosks – R-rated movies – could hinder future success based on the actions of a few city councils in the Midwestern United States. City councils in Indiana, Kansas and Texas have recently pressured locations that house redbox kiosks, including McDonald’s and Wal-Mart, to remove R-rated movies from its contents. And in some cities, kiosk owners have relented. Union City, Ind., Mayor Bryan Conklin began pressuring the owner of the town’s only McDonalds in Sept. 2007 to remove its R-rated titles after residents complained that it was too easy for youngsters to rent the age-inappropriate movies. Union City McDonald’s owner Rick Reichenbach agreed to take the R-rated titles out after being threatened with a public nuisance citation. Since that incident, communities such as Anthony, Kan., and Winchester, Ind., have taken steps to remove R-rated movies from other DVD rental kiosks. Their actions are supported by Video Buyers Group, an organization that supports independent video retailers. VBG has contacted dozens of city councils and retailers in Midwestern communities in an effort to remove R-rated movies from kiosks at McDonald’s and Wal-Mart. “This is an issue of values,” said Jon Engen, VBG’s head of marketing. “McDonald’s is a family place, yet they are not doing anything to stop these youngsters from getting R-rated movies.” There is no federal law that stipulates it is illegal to sell or rent R-rated movies to persons under the age of 17, but many video stores, retail stores, movie theaters and vendors adhere to the Motion Picture Association of America’s voluntary film ratings system. Under those guidelines, an R-rated motion picture may include adult themes, hard language, violence, sexually-oriented nudity and drug abuse. Children under 17 are not allowed to attend R-rated motion pictures unaccompanied by a parent or adult guardian. Engen said the DVD rental kiosks are similar to the old cigarette vending machines. “Sure there were signs that said you have to be of a certain age to buy (the cigarettes), but that didn’t stop anybody from getting them,” Engen said. “These (DVD kiosks) are left unattended and easily accessible to children.” Redbox disagrees. Gary Lancina, VP of Marketing for redbox, said the appropriate measures are in place to allow parents and families to make educated choices regarding age-appropriate entertainment options when using redbox kiosks. “Consistent with industry standards, you must confirm that you are 18 years of age or older, with a valid debit or credit card, to rent an R-rated movie,” Lancina said. “Any time a customer selects a R-rated title, a screen appears informing the customer that they will be renting a DVD with a R-rating. Customers then have a chance to select a different movie or proceed with their rental.” DVDPlay, which owns approximately 1,400 DVD rental kiosks nationwide, has not had anyone contact them about R-rated movies. All of DVDPlay’s kiosks have legal information that says the renter must be 18 years or order, said Lisa Gerber, a DVDPlay spokeswoman. In addition, the DVD kiosks do not accept cash, only credit cards. “We hope that the person that uses the credit card is indeed the owner, and is therefore legally renting that movie,” Gerber said. Hurting business? More than 6,000 redbox kiosks are at locations across the United States. It plans to add at least 4,000 more at Wal-Mart and Walgreen’s locations. The number of R-rated movies at any one kiosk differs from location to location. “Because of the convenient “rent here, return anywhere” capability of the redbox network of locations, the specific selection of films in a given redbox kiosk varies from week to week, and even day to day,” Lancina said. “We are confident that the percentage of R-rated titles in our locations is, on average, well below the historical 58 percent average of the industry.” According to the MPAA, R-rated films constituted 58 percent of films by rating from 1968 through 2006, and the percentage of R-rated films has been on the rise over the past five years. Redbox actually rejects the majority of R-rated films that studios solicit, Lancina said. In contrast, the majority of G, PG, and PG-13 films solicited to redbox are in turn made available to customers. A look at five redbox kiosks in the Louisville, Ky., area showed that on average, of the approximate 185 titles in each kiosk, about 73 titles were R-rated, with another 10 titles unrated. An unrated classification means the movie was not submitted to the Motion Picture Association of America for a rating. That number was surprisingly large to kiosk consultant Francie Mendelsohn, president of Summit Research Associates. Though, she said that these small towns removing one or two kiosks will not be an issue to redbox. However, if a larger city were to remove dozens of the kiosks, the impact could be felt. “If a place like Louisville were to say, ‘no, we’re not going to have these movies in our town,’ then the DVD kiosk companies might have a problem,” Mendelsohn said. Unrated movies are also an issue for the VBG, Engen said. Many of those titles have more violence and sex than R-rated movies. Since last year, redbox has discontinued the purchase of unrated versions of R-rated movies and has even advised studios to not solicit unrated versions of films, as they will be rejected outright, Lancina said. He also noted, though, that many of the unrated titles in redbox kiosks are family friendly. The vast majority of unrated movies purchased by redbox consists of family features such as “High School Musical,” “Hannah Montana,” “Bob the Builder,” “SpongeBob Squarepants” and “Dora the Explorer.” Though removing R-rated movies from kiosks has been effective in some towns, Mendelsohn said she thinks it’s nothing for DVD kiosk companies to worry about right now. “I think it could affect the companies if this movement were more widespread,” she said. “I don’t see the DVD companies losing a lot of sleep over it now.” Engen said his goal is not to have Redbox kiosks removed, but for them to adhere to the same standards that many retail and video stores follow. “I live in a community where allowing underage children to watch R-rated movies is unacceptable,” Engen said.