Independent rental stores are trying new tactics including lower prices, longer rental periods and more DVDs stocked for sale in a stepped-up effort to battle the 24/7 convenience of Blockbuster Total Access and the $1 pricing of Redbox and other kiosks.

Engen believes that traditional video stores’ greatest strength is that their selection normally trumps the average 70-title Redbox by hundreds of movies or more.

Yet, “what is causing a lot of competition for the industry is Blockbuster Total Access,” adds Engen. “You are pulling a whole segment of the [traditional] marketplace online, because there is that option where they can take back DVDs to the store.”

Looking at certain markets it penetrated last year—Denver, Salt Lake City, Baltimore, Houston, St. Louis and Minneapolis—Redbox commanded a 4.3% share of DVD revenue in third-quarter 2006, estimates NPD. Those same markets jumped to an 8.2% share for Redbox during the second quarter of 2007. NPD started tracking Redbox last year.