It’s Wednesday night. There is nothing good on, and you feel like watching a movie. Sure, you could read a book or exercise, but by golly, you are in a mood to watch a movie and there just ain’t no stopping it. How will you achieve this simple goal? These days, millions of cost-conscious movie watchers are turning to Redbox. What is a Redbox?
Redbox Automated Retail makes those movie kiosks that lurk outside your local grocery store or Walgreen. And they are making a killing. The extremely fast-growing company owns more than 15,400 kiosks nationwide (with each kiosk holding some 700 discs and 200 titles) and wants to double that number by 2012. Once owned by a subsidiary of McDonald’s, Redbox was acquired by coin-counting machine specialist Coinstar in 2008.
Renters pay only a buck for a movie title, and there are no late fees. In the middle of a recession, that’s some pretty good movie-watching. You don’t even have to have a membership. This means the days of you being told to fill out a membership form by a teenager working at Blockbuster while people in line behind you groan and give you nasty looks are gone.
However, according to this study conducted by the Los Angeles County Economic Development Corporation, every time you spend your dollar you are putting a world of hurt on the movie industry by damaging DVD sales, cannibalizing jobs, and impacting the potential funding for future film and TV productions. The study states that because of its super low-cost business model, Redbox is contributing to the cutting of 9,000 jobs and the combined earnings of $395 million for the movie industry. The studios are freaked.
Do you supply Redbox with cheap wholesale discs and watch them rake in the cash or do you hold back release dates and put the squeeze on them in hopes of preserving higher-priced purchases? While Sony Pictures decided to play ball and signed a five-year supply deal with Redbox last summer, 20th Century Fox, Universal Pictures, and Warner Home Video opted for the squeezing.
Redbox fought back this summer by filing law suits against those three studios after they insisted that Redbox delay renting out DVDs of their films until a 28- to 45-day waiting period had elapsed from the time of their films’ release date.
But is Redbox really the end for Hollywood? Nah. Despite its outcry at the time, Hollywood survived the era of people taping movies on their VCRs, and it will adjust to this new method for watching movie releases. Besides, this battle for the way we view hard-copies of movies is only temporary until the day comes when we all download every single bit of our entertainment digitally. So Hollywood, it might be better to begin investing in the download business.
That might be the best way to get rid of Redbox once and for all.
Redbox may not be the end of Hollywood, but it’s going to help kill Blockbuster and Hollywood Video. No one will miss those businesses!
I just wish I’d invested in Redbox a few years ago every time I drive by my local Walgreen’s — there’s nearly always a line at that kiosk.
considering the eye candy crap that hollywood is putting out and the amount of money that the execs make , all i can say is wa, wa wa ,wa ,you cried when the vcr came out, when you realized that it was a larger outlet for your product, oh its ok , then dvd , then streaming online, what next, when someone has a camera and wants to make a movie and they cant because they don’t have the same licence you have, or actors guild, or union, give a guy a break, a dollar for a movie is great, well sort of, the options aren’t much,but still , come on .