Why the 1980s Revolutionised Movie Nights? The Rise of Video Rentals.

From Legal Battles to Blockbuster Nights, Discover the Real Reasons Video Rental Shops Became a Cultural Icon

In today's newsletter, you will learn about the meteoric rise of video rentals and how chains like Blockbuster grew through the 80s and 90s to a peak in 2004, with over 9,000 shops worldwide.  

Most folks my age have fond childhood memories of visiting the local video store, browsing the latest movies, and being guided away from the promiscuous "adult" section 🙈 to the safety of a family movie. Once agreed, we'd head home for a movie night with a new video rented in hand, some popcorn, sweets, and drinks.

These nostalgic times were some of the best childhood memories, but video rentals were a unique experience. We didn't rent music; we only rented books via the library. So, what and why did video rentals take off and define movie nights?

We all know how the story ends; the video rental store met its final scene, but do we know how it opener? Let's rewind in time and delve into today's Five Whys.

Why #1: Why did video rental shops start renting in the 1980s?

Home video technology, like VCRs, became affordable (although for many, we still had to rent the machines), allowing people to watch movies at home rather than in the cinema. Inspired by the opportunity, some entrepreneurs realised they could buy a single copy of a film and rent it to multiple people, creating a new business model that tapped into a growing desire for at-home entertainment. This setup provided affordable movie access without the high price of purchasing individual tapes.

Why #2. Why did the availability of VCRs and expensive tapes lead to rental shops?

Buying the tapes was convenient but not cost-effective, often costing upwards of $80 per tape. The movie studios justified this cost to control distribution, reduce piracy, but let’s face it this was all to maximise profits. Renting became an affordable solution, enabling customers to enjoy a wide range of films for a small fee. Video rental shops filled a critical market gap, allowing people to experience new releases without the financial strain of owning a collection. Entrepreneurs found a way to profit by repeatedly renting out tapes, which created a win-win for consumers and business owners.

Why #3: Why were video rental shops challenged by the movie industry?

Seeing this new business model as a potential threat, movie studios initially attempted to stop video rental shops by taking legal action. They argued that rentals undermined their ability to control distribution and sales profits. However, the court ruled in favour of rental shops, affirming that renting out purchased tapes was legal. This landmark decision secured the future of the video rental industry, legitimising it and encouraging more entrepreneurs to open rental stores, further popularising the model.

Why #4: Why did Blockbuster emerge as a franchise leader and change the rental market?

With the legality of video rentals settled - the path for video rental shops was clear. Video shops of all sizes started to pop up in high streets globally. Harry Wayne Huizenga Sr. - an entrepreneur who had created a waste management company earlier, saw an opportunity to standardise and franchise the rental experience. He launched Blockbuster, a chain with a clean, bright, family-friendly environment, complete with a signature blue-and-yellow colour scheme that made the stores inviting and approachable. Blockbuster's model offered consistent service, a vast movie selection, and a familiar setup, quickly building customer trust and loyalty that stayed away from adult movies. Families enjoyed browsing and selecting movies together, transforming a simple rental trip into a social experience.

Why #5: Why did video rental shops like Blockbuster become a popular cultural staple?

The franchise model made video rental accessible to families everywhere. Blockbuster stores provided an affordable, enjoyable experience that became a weekend tradition. Blockbuster's friendly design and inviting layout made movie rentals more than just a transaction—they became an experience. As stores expanded nationwide, even to my sleepy, quiet town, Blockbuster and similar shops became a defining part of the 1980s and 1990s culture, shaping how people engaged with movies and entertainment. This model laid the groundwork for the video rental industry to thrive as a cornerstone of family entertainment and defining movie nights.

In Summary...

What started as an opportunistic moment to make money from repeatedly renting a single tape led to a multi-billion-dollar industry.

Despite the movie studios' desire to shut it down, the legal victories against the movie industry, coupled with the innovation of Blockbuster's franchise model, transformed these shops into beloved social spaces. The affordable, family-friendly approach and the colourful, calming, and welcoming environment created a lasting cultural phenomenon in home entertainment.

As streaming and on-demand services grew, the video rental industry slowly declined and eventually died. However, this wasn't just an industry that died; movie night's experience and magic were changed forever. Something that is consigned to history and remains a nostalgic for a generation.

Thanks for reading, and remember, curiosity leads to these fascinating discoveries.

So, keep asking those questions and stay curious. If you liked this article, please consider subscribing to the below. And remember, don't hold the internet's best-kept secret to yourself—share it with your friends.

- Matt