Do rights holders get royalties each time a video is rented, or just when a video rental store purchases a copy?
by 
Glenn Blaylock
ANSWERS: 4
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If the store purchased a copy, the rights of the copyright holder in that copy ended, except of course the right to prevent further copying. The question is whether Blockbuster, e.g., buys outright, or rents copies as an agent for the studio (somewhat analogous to a movie house). I believe (but don't know for certain) that it's the former. Anybody out there in the business? On the issue generally, you might be interested in the question beginning, "I bought a pile of prints . . . ." (Number 8 on this list as of 6/14/05.)
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Royalty payments are frequently incorporated into the purchase price of the film, i.e., a rental business pays a higher price for the film. A business may be able to purchase a site license for their operations, depending on how they use the films and what kind of business they are, e.g., commerical or non-commercial (library).
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If the store isn't BlockBuster they only get paid when the rental store purchases a copy. If it is BlockBuster they get paid every time a movie rents: " The standard business model for video rental stores was that they would pay a large flat fee per video, approximately US$65, and have unlimited rentals for the lifetime of the cassette itself. It was Sumner Redstone, whose Viacom conglomerate then owned Blockbuster, who personally pioneered a new revenue-sharing arrangement for video, in the mid-1990s. Blockbuster obtained videos for little cost and kept 60 percent rental fee, paying the other 40 percent to the studio, and reporting rental information through Rentrak. What Blockbuster got out of the deal, besides a lower initial price, was that movies were not available for sale during an initial release period, at least at an affordable price point - customers either had to rent, wait, or buy the film on tape at the much higher MSRP targeted at other rental chains and film enthusiasts, at that time then between $70-$100 before the end of the initial release period. " --wikipedia
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In America, no. In other countries, maybe. Once a copy of a movie is sold, the purchaser has the right to dispose of that copy as he pleases. That means he can destroy the copy, lend out the copy, rent out the copy, or do anything else with the copy (except copy it or publicly display it). For those who are curious, this is called the "First sale Doctrine." Most other countries, however, still give the rights owner certain rights after the first sale. These rights usually deal with attribution and the integrity of the work, but could include continued royalties for future transfers.
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