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Redbox snatches up NCR's entertainment division, swallows Blockbuster Express business
If you thought Coinstar was through making industry rattling announcements today, you were wrong. After taking the wraps off its joint venture with Verizon, now the company has announced it'll be taking over NCR's entertainment division for $100 million. That includes DVD kiosks, retailer contracts and an inventory of discs for stocking the machines. That's big news not only because it expands Redbox's already sizable self-serve rental empire, but because it's doing so at the expense of the floundering Blockbuster, since NCR owns the blue and yellow rental kiosks. Presumably existing Blockbuster Express installations will become Redboxes, though, how quickly that might happen is unclear. For a few more details about the deal check out the PR after the break.Update: We've attached a letter from Blockbuster explaining the switchover after the break.
Redbox passed 30,000 kiosks in Q4 2010, but still missed financial expectations
Redbox may be a red-logoed stepchild compared to industry darling Netflix, but according to its parent company Coinstar's Q4 earnings call, it still managed to pass the 30,000 kiosk milestone, increase market share to 30 percent and grow DVD revenue by 38 percent to $319.6 million. Combined with blowing by one billion rentals back in September and avoiding a lawsuit with Fox, the news would have culminated in champagne and karaoke for Coinstar shareholders... except for one thing: new releases underperformed during the last quarter along with Blu-ray rentals. Coinstar CEO Paul Davis was quick to bolster investor concerns on the call, however, stating company management had taken "definitive steps to correct the issues" and was ready to "leverage the First-sale doctrine" -- which refers to a Supreme Court ruling limiting the control of copyright holders over the re-selling of its property -- should studios get sassy in future distribution negotiations. More updates on the company's streaming plans didn't materialize, though, so you'll have to chuck those dreams of instant rental gratification for a buck back in the deep freeze at least in the near term. Otherwise, hit up the source links below to ogle data tables to your heart's content.
Blockbuster partially reaches back to the 90s, announces 3-day in store rentals with tiered pricing
Right on the heels of announcing that its on demand service was available on over 100 devices, Blockbuster has officially reduced in-store rentals periods from five to three days and established new pricing tiers. "Just arrived" Blu-rays and DVDs now cost $4.99, making them competitive with Redbox on a cost per day basis, especially when you consider the red vending machines must wait for up to 28 days later in some cases to get newer titles. Recent releases in circulation longer than six weeks cost $2.99 along with frequently rented "Top Picks," while older, and less popular titles -- think Weekend at Bernies -- have bottomed out to $0.99. According to company rep Patty Sullivan, these changes should help Blockbuster "continue to be a competitive force in the media business" and "simplify the rental experience." That sounds a lot like the same stance it took with the now dead no late fee scheme -- but who's keeping track? It also still seems expensive for frequent movie watchers compared to Netflix's basic $10 a month plan, which includes one rotating mailed disc along with unlimited streaming. So call us crazy, but somehow we don't see this move solving the company's bankruptcy woes anytime soon.
