Wait, what? Blockbuster did end late fees, and it was widely regarded as a disaster, because then people took their sweet time returning rentals (above and beyond the lost revenue):
>Blockbuster tried dropping its late fees a few years ago, but that didn't work out well because it kept the most popular DVDs out of its stores for long stretches.
I don't know this for a fact, but I'd wager a guess that interest in rental movies is mostly concentrated around a handful of titles at any given moment, whereas interest in library books is more evenly dispersed. This means that two people are much less likely to want to rent the same book at the same time, as opposed to the same movie.
Libraries do sometimes get a lot of interest in hotly anticipated new titles sometimes. You're generally right that there is a lot more "long-tail" activity than in a video rental store, though -- and it's much easier for a library to maintain a collection of rarely used books.
https://www.nbcnews.com/id/wbna39332696
>Blockbuster tried dropping its late fees a few years ago, but that didn't work out well because it kept the most popular DVDs out of its stores for long stretches.