If a new round of Blockbuster store closures in New Jersey last month wasn't bad enough, Redbox this week has purchased the company's line of rental kiosks. What's left of the former rental king is a dwindling number of brick-and-mortar shops, an archaic by-mail rental business and a streaming service limited to Dish TV customers.
According to Redbox, the $100 million acquisition will cover NCR's 9,000 Blockbuster-branded kiosk units, unspecified retail contracts and DVD inventory.
"Through this agreement with Redbox, NCR will be better positioned to focus on expanding our business in our targeted industries," said John Bruno, executive vice president and chief technology officer, NCR. "Additionally, this transaction affords us the opportunity to develop a long-term strategic relationship with Coinstar and partner on delivering new and innovative solutions to the market."
The Los Angeles Times reported that Redbox has yet to determine how many Blockbuster Express units it will decommission and how many will be re-launched under its banner. The company currently operates over 28,000 kiosks across the U.S.
Blockbuster Express General Manager Justin Hotard posted a letter to the company's website which explained that until the deal is finalized, nothing will change:
NCR, which operates your Blockbuster Express kiosks, has entered into an agreement to sell its kiosks and other assets to Redbox. Until the transaction is completed (we anticipate in the third quarter of 2012), you will continue to enjoy the convenience, choice, and value you're used to from Blockbuster Express. Until the sale is completed, we will continue to run the business as we have been, focused on bringing you the latest New Release movies with most titles only $2 for the first night. You'll also notice that we've increased our In-Stock Guarantee value so you will now enjoy a movie night on us with a value of up to $3 if we don't have the New Release movie you want in stock.
As a reminder, we still have 100s of great movies available at $1 and additional nights of all movies are still only $1, all part of preserving an exceptional value for an affordable night of entertainment.
We'll continue to provide you with information on any changes that result from this recent announcement but for now we just wanted to say thanks for being our customer.
Redbox's buyout follows a joint announcement with Verizon that the pair will later this year launch a Netflix competitor. The unnamed platform will offer both physical and online streaming options, the companies said.
