or something like that. Driving past the local Blockbuster today to pick up a sandwich at Subway, I noticed that in an effort to counterprogram Hollywood Video, they've also switched to 3 for $25. This, on the face of it is a boon to the consumer. I know that it will probably alter my buying pattern. I was done shopping at Blockbuster when it was two for twenty dollars, but I'm more likely to shop there now that it's a comparable 3 for $25. But how much more needs to happen before the used DVD market would become deflationary? At some point, in a war between two companies over the aforementioned DVD prices could cause used DVD prices to spiral, ruining the market. Why would I pay 3 for $25 for something when I know that it's only REALLY worth X? Do I hold off on buying until it reaches price point X? Do I see it at price point X and knowing the history of the market decide that I should wait until it reaches price point Y?
Obviously, this is a rather simplistic model, but one wonders if CD price fixing was fixed for anti-deflationary reasons. It just seems as though there's more volatibility in the used DVD market than their is in the used CD market... but then again, you couldn't ever really buy used CDs at a national chain that's as highly visible as the equivalent Blockbuster or Hollywood video. Thoughts?
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