DVD kiosks offer lifeline to stores

CLAIRE ROGERS
Last updated 05:00 16/09/2012
Video Ezy
JOHN SELKIRK/ Fairfax NZ
EASY-TO-USE self service DVD vending kiosks are being set up by Video Ezy.

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Video stores are turning to low-cost self-service kiosks, and Video Ezy is the latest to test the market for DVD vending machines in supermarkets and malls.

The kiosks let customers rent mainly new releases using credit and debit cards, charged when the movie is returned.

Video Ezy director Kevin Peterson said the company had eight kiosks in supermarkets and malls in Auckland, Wellington and Christchurch.

"They are a good way of getting product to people rather than people to product."

The lower operating costs meant overnight new releases cost $5, compared to the usual $8 in stores.

Video Ezy was testing the kiosks, which had been in the market for about a month, before deciding on a wider rollout.

They are common in Australia and the United States, where the combination of kiosks, digital downloading and mail-order services have been blamed for the demise of video stores.

Peterson said the kiosks, which would be owned by franchisees, would not be a catalyst for store closures, but could supplement them in larger centres and provide a service in smaller towns.

"Our Ponsonby store is open 24 hours a day, seven days a week and has 25,000 titles. You can't replace that with a kiosk."

Video Ezy has 122 stores, after closing three this year, and expects about 10 more to close in the next 18 months. Peterson said that although the industry was consolidating, the online download threat had been exaggerated.

Consumers were still years away from ultrafast broadband, and although downloading was often perceived to be cheaper or free, consumers still had to pay for broadband and rentals or subscriptions.

"Our bricks and mortar model is going to be here for a long time."

There is already competition in the vending market. DVDNow Kiosks director Gavin Ross said it had dispensed about 20,000 films since it began installing kiosks a year ago.

Part of an international franchise, it has 10 vending machines in Auckland, Ashburton, Dunedin and Winton, where the town's video store closed shortly before the kiosk went in.

"We're working on a deal to roll out 150 of them."

A Hoyts spokesman said it had about 400 kiosks in Australia and planned to install them here next year.

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