Blockbuster boosts Total Access prices

Mail-only subscription plans get slight discount

By Ned Randolph -- Video Business, 12/20/2007

DEC. 20 | Blockbuster, in a bid to increase the profitability of Total Access, is changing the prices of DVD rental subscription programs, with rates for its Total Access Premium offering unlimited mail order and in-store exchanges going up a hefty $5 to $10.

Some customers have already begun receiving notices of the changes, which range from increases of $10 a month to $1 decreases. The changes take effect on the next billing cycle for existing customers and on Dec. 27 for new customers.

"We're in the process of notifying existing subscribers if their prices are changing," said company spokeswoman Karen Raskopf. "Our goal is to provide a variety of subscription plans to meet the needs of our customers."

Blockbuster, which offers a multitude of subscription programs, is reducing prices for some mail-only services, which compete directly with Netflix, and increasing prices across the board on the more costly Total Access programs, which allow delivery by mail and in-store exchanges.

The basic Total Access packages, which offer unlimited mail order and limited free in-store movie exchanges, are increasing by $2 a month—totaling $11.99 for one DVD out at a time with two free in-store changes; $16.99 for two DVDs and three in-store exchanges; and $19.99 for three DVDs and five free in-store exchanges. Customers who exceed the free in-store exchanges can return movies to a store for discounted $1.99 rentals and $4.99 game rentals.

Subscription rates to Blockbuster's Total Access Premium of unlimited mail order and in-store exchanges are going up between $5 and $10. The subscription rate for one DVD out at a time increases from $16.99 to $21.99; two DVDs out at a time will increase from $21.99 to $29.99 and three DVDs out at a time will increase from $24.99 to $34.99.

This is the second price increase this year in the Total Access offerings. Blockbuster effectively raised prices on July 26 by limiting Total Access in-store rentals and introducing Total Access Premium, which it priced $7 higher than Total Access.

In the mail-only program, which was launched in June, Blockbuster will reduce prices in some cases. The cheapest by-mail plan that allows one DVD rental at a time, limited to two per month, will be reduced $1 to $3.99; and the most popular by-mail plan, which allows for three DVD rentals out at a time, will be reduced $1 to $15.99 for new subscribers only for a limited time. Mail only subscribers can return movies to a store, in exchange for discounted $1.99 rentals.

"A lot of people don't know we have a program that rents by mail. They think we only have Total Access," said Raskopf. "We're making it easier for people to give by-mail service a try."

Total Access in-store memberships, which allow unlimited rentals, will remain the same at $21.99 for one rental at a time or $29.99 for two rentals at a time.

"That plan has been around for a while," Raskopf said. "We haven't been promoting it, but this holiday season we will be pushing it."

Blockbuster CEO Jim Keyes said in November that Blockbuster had done a poor job of differentiating its portfolio of plans to customers. The company in the third quarter pulled its ad spending in order to save money and re-calibrate its offerings. Raskopf said no ad promotions are expected but customer service representatives will be mentioning the new programs to customers as they check-out.

When Blockbuster launched its mail-order-only program in June, it forced Netflix to match its prices. Netflix reduced its plans of three DVD rentals at a time to $16.99 and two DVDs at a time for $13.99, which are the same prices as Blockbuster.