If you haven’t heard of Redbox, it’s essentially Blockbuster’s worst nightmare. It is a little kiosk that you might see around town, in grocery stores, outside pharmacies, etc., that offer $1 a night movie rentals. Plus they have a decent selection, making them a key player in media distribution, but also a threat to DVD sales.
Paramount and Redbox have just announced that all of Paramount’s upcoming movie releases will be offered on Redbox the same day as they go on sale in retail stores. The reason for this deal? Dennis Maguire, Paramount’s Home Entertainment’s worldwide president had this to say on the subject:
“By granting Redbox day-and-date availability we are allowing the consumer a choice of how to consume our movies while maximizing the profitability of our releases in the home entertainment window,”
And when asked about the cannibalization of sales, he claimed that Redbox “had minimal impact on our DVD sales,” thanks in part to a 10-month trial period where Paramount watched the sale of DVD’s versus the growth of Redbox.