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Renting movies in the late 1970s was a novel concept. Before the rise of home video technology, the only way for most people to watch films outside of a theater was to wait for them to air on television. George Atkinson, recognized as the father of the video rental store in the United States, had the vision of making films available for rental which revolutionized home entertainment and paved the way for the home video industry.
Atkinson opened the first VHS rental store, “Video Station,” in Los Angeles in 1977. At the time, movie studios were selling copies of films on VHS for around $50 to $70, a steep price for the average consumer.
Atkinson saw an opportunity and began purchasing these tapes to rent them out to customers. He offered two membership options: an annual membership fee of $50 or a “lifetime” membership for $100. After that, customers could rent a video for $10 per day, providing them with a more affordable way to access films.
At its climax, “The Video Station” grew into a large network, with over 600 affiliate locations. This pioneering business model led to an explosion of video rental stores across the U.S., with more than 15,000 video rental shops established by the mid-1980s, forever changing how Americans consumed home entertainment. “The Video Station” ultimately closed its doors in March 2017, marking the end of an era that began with Atkinson’s groundbreaking approach to movie rentals.
However, the distinction of being the first business to rent movies does not belong to Atkinson. That honor goes to Eckhard Baum of Kassel, Germany, who began renting movies on Super 8 film in 1975. Initially, Baum lent his collection to friends, but soon turned his hobby into a rental business. His store, ‘Videothek,’ remains in operation as of 2020, though it now functions largely as a museum, reflecting its historical significance as the world’s oldest video rental business.
The $10 rental fee Atkinson charged per day in the US may seem expensive by today’s standards, but when compared to the cost of purchasing a VHS tape, it was a cost-effective alternative for movie lovers. Renting also gave consumers access to a wide selection of films without the high cost of ownership, which helped drive the popularity of rental stores throughout the 1980s and 1990s.