Company expands amount of game rentals
Having established a position of power in the film rental industry, Redbox is deepening its move into the videogame world.The company, which has been running a limited test of game rentals, is substantially expanding the experiment, adding game rentals to thousands of its self-service kiosks in the West, Midwest and East Coast. Redbox began experimenting with vidgame rentals in August 2009, adding them to select locations in Reno, Nev., and Wilmington, N.C. That test expanded to Orlando, Fla., and Austin, Texas, earlier this year. But with this step, the company will bring games to roughly 40 markets and “a few thousand” of its 24,000 locations nationwide, according to a spokesman. Rentals will cost $2 per day — vs. the company’s $1 per day rate for DVDs. Games will be available for the Wii, Xbox 360 and PlayStation 3 as well as the Nintendo DS. Redbox said the test is meant to gauge consumer interest in game rentals and is not a signal that it will add titles to all boxes nationwide. There’s not a lot of competitionin game rentals, however, while the movie market is crowded and faces increased competition from online streaming services. Blockbuster rents games in its fast-fading brick-and-mortar locations and recently began offering certain titles via mail as well. But the real leader is Gamefly, which is in the midst of ramping up for an IPO. The games-by-mail company (basically a Netflix for the gaming world) is hoping to raise $50 million. Gamefly has 334,000 subscribers and a library of 7,000 titles. Last year, it generated revenues of $84.7 million. Gamefly charges monthly subscriptions starting at $15.95. But consumers must wait for games to reach them, and popular titles aren’t always available when gamers want them. Redbox will likely capitalize on the same advantages that have made it popular with homevideo consumers — immediacy and low cost. Players who want to sample a game — or who don’t want to pay full price for a title, given how short some single-player titles have become in recent years — can use the kiosks to get their fill. The company is likely to market as well to casual gamers, who buy only one or two games per year. The initial selection of games is fairly robust and includes new releases. Among the titles Redbox is promoting on its Website are “Medal of Honor,” which was released Tuesday, and “Enslaved: Odyssey to the West,” which came out earlier this month.
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