I live in the city. We techie types, you and I, are myopic. Folks in the city, country, DON'T all have internet or for that matter, a pc. We, they, do have, however, a BIG tv...folks don't spend money wisely. (caveat that my biggest tv is 20" and not flat) I see lots of folks at RedBoxes renting movies. Physical rental will always be with us. Remember the call in 1990 or so for "paperless society"...how well did that go? Don't be a lemming; you have good analysis, but we all have blind spots.
They may not have a real charge card, but they do have a GreenDot Visa or MasterCard. They also tend to keep the DVD for 3 times as long as the average renter. Plus..just look at the PEG ratio of 0.68 ! This negative crap is already figured into the stock price. Redbox replaced the $3.50 rental DVD. All it would take is an increase to $2.00 or so to explode the stock price. A few good movies out of Hollywood would help too.