For quite some time now we’ve been hearing rumors of a move by Redbox to enter into the streaming video business. As with many rumors, it seems there was some truth in this one!
Coinstar CEO Paul Davis made an announcement during the company’s quarterly earnings conference this week and stated that Redbox is currently holding “detailed negotiations with a number of highly interested parties” to begin an online streaming service some time during 2011.
Davis was careful not to disclose any information about who Redbox was negotiating with, but speculated possibilities include Amazon Video on Demand, Sonic Solutions (streaming partner for Best Buy and Blockbuster), and Wal-mart-owned Vudu.
Details of a potential pricing structure are also unknown at this point. Redbox did conduct a survey in April asking if customers would be interested in a $3.95-per-month plan with unlimited streaming and four free DVD rentals from their kiosks. Davis dismissed that speculation however, stating that it was too early to decide if the service will be unlimited or on a per-view basis (or multiple plans?).
Redbox has had great success with their $1 per night DVD rental kiosks the past couple years, but they are facing increased competition from companies who have already entered the streaming video business. Netflix is now available as a disc-free streaming service on all of the major gaming consoles, and several retailers have begun launching their own streaming services for customers who buy web-enabled televisions and other products.
My household was on a Redbox kick for quite some time, but Netflix and Hulu have become more convenient alternatives than trying to remember to return a disc to a kiosk the next day. That said, it’s a smart thing that the company is moving toward streaming, but I hope they’re not too late to the game to be able to compete with existing services.