×
You will be redirected back to your article in seconds

Redbox Now Controls More than 50% of Home Video Disc Rental Biz

'Jack Reacher,' 'Django Unchained,' 'Life of Pi,' 'Silver Linings Playbook' among top rented titles for Redbox during record second quarter

As Netflix evolves into more of a streaming video platform, and Dish Network shuttering more Blockbuster stores, Redbox is enjoying the benefits, seeing its share of the disc rental business grow to more than 50% for the first time.

Consumers rented 186.7 million discs from Redbox during the quarter, company parent Outerwall said. Redbox operates around 43,700 kiosks. Its marketshare rose 7% to nearly 50% during the first quarter, and surpassed that over the last three months.

The most rented Blu-ray titles during the period were “Jack Reacher,” “Django Unchained,” “Life of Pi,” “Silver Linings Playbook,” “Hansel and Gretel: Witch Hunters,” “Oz the Great and Powerful,” and “Snitch.” “The Hobbit,” “Les Miserables,” “Gangster Squad,” “Red Dawn” and “Mama” performed weaker than expected, the company said.

Still June ended up being the third-highest rental month in the company’s history, trailing December 2012 and March 2013, according to Outerwall CEO J. Scott Di Valerio. Redbox reps around 85% of the Bellevue, Wash.-based company’s revenue.

During the second quarter, Redbox redesigned more than 20,000 of its kiosks to carry at least 80 more discs in each box as a way to increase inventory. The units used to have 630 slots and now hold more than 700 discs. Company also has been reorganizing its kiosk network, selling several thousand boxes that NCR operated.

The expansion of the boxes helped Redbox grow rentals by 3.7% during the second quarter, compared to the previous year. They were flat during the first quarter.

Redbox attributed the growth to a 74.3% surge in Blu-ray disc rentals. Redbox also said the rentals of videogames also increased 40% as it expands into that area.

That helped profits rise 27% to $46.9 million and revenue increase 4.1% to $554.2 million.

The company earned on average $2.56 per rental, and saw more one-night rentals than usual, resulting in lower than expected net revenue during the quarter.

Analysts believe Redbox was helped in part by rival Netflix losing 470,000 subscribers to its DVD-by-mail business during the same quarter. While kiosk-based rentals are up 1% to 39% during the first six months of the year, subscription-based DVD-by-mail order services accounted for 22% of the overall DVD rental market during the same period (a decline of 26%), according to NPD Group.

Still while activity at its kiosks is up, Redbox still wants to grab a bigger share of Netflix’s streaming stronghold.

Outerwall, which purchased former Redbox parent Coinstar in 2008, owns 35% of Redbox Instant by Verizon. That streaming service is expected to see more growth by adding apps to videogame consoles later this fall and Roku, and benefit from the homevideo releases of tentpole titles that bowed this summer.

Redbox Instant currently offers unlimited access to 5,000 titles and four disc rentals. Service was introduced at the Consumer Electronics Assn confab in Las Vegas in January, and launched in March, the end of Netflix’s first quarter.

More Biz

  • pharrell brain child show

    'Blurred Lines' Flares Up Again - Marvin Gaye Family Claims Pharrell Perjured Himself

    Like a zombie that just won’t stay dead, the “Blurred Lines” case keeps coming back. While the 2015 verdict, in which Pharrell Williams, Robin Thicke and the song’s publisher were ordered to pay nearly $5 million to Marvin Gaye’s family for infringing upon the late singer’s 1977 hit “Got to Give It Up,” was basically [...]

  • WGA Agency Packaging Fight Placeholder Writer

    WGA-Agency Showdown: Role of Showrunners at Heart of Legal Arguments

    The Los Angeles courtroom of U.S. District Judge Andre Birotte was packed with well-dressed lawyers on Friday morning, eager to watch a high-stakes brawl between Hollywood’s largest talent agencies and the Writers Guild of America. Birotte allowed only four lawyers from each side to sit at each table, leaving the vast majority of the attorneys [...]

  • 700700 + Ted Turner Dedication. December

    Ted Turner Tributes Established With WarnerMedia Gift to University of Georgia

    WarnerMedia has established a scholarship, internship program and exhibition hall at the University of Georgia to be named after maverick media mogul Ted Turner. The company has gifted $550,000 to the university to create the Ted Turner Scholarship Fund, for students attending the school’s Grady College of Journalism and Mass Communication, which is also the [...]

  • WGA Agents Contract Tug of War

    Judge Leans Toward Agencies' Position in Writers Guild Antitrust Suit

    A federal judge indicated on Friday that he will allow the three major agencies to pursue their antitrust lawsuit against the Writers Guild of America. The WGA has urged U.S. District Judge Andre Birotte to throw out the suit, arguing that its actions in its ongoing battle with the agencies are protected under antitrust law. [...]

  • Keli LeeStep Up Women Network 9th

    Keli Lee Exits ABC Studios International as Disney Considers Division's Fate (EXCLUSIVE)

    ABC veteran Keli Lee has left the international arm of ABC Studios as Disney considers the future of the London-based content unit, Variety has learned. Sources said Disney has told the creative community that there “has been a re-evaluation of ABC Studios International” and that it is re-assessing “the creative direction” of the business. There [...]

  • Biggest Scandals Feuds and Apologies of

    Biggest Scandals, Feuds and Apologies of 2019

    Variety looks back on some of the biggest scandals, feuds and apologies of 2019: College Admissions Scandal Wealthy parents including Felicity Huffman and Lori Loughlin were charged with bribing school officials to get their unqualified kids into prestigious universities. Shane Gillis Executives at “SNL” hired, then fired, Gillis in September, before the new season started, [...]

  • Biggest Media Moments of 2019

    From 'Catch & Kill' to Shepard Smith: The Biggest Media Moments of 2019

    Variety looks back on some of the most memorable media events of 2019: ‘Catch & Kill’ Reopens Wounds at NBC News Ronan Farrow’s book relitigates his complaints that NBC News tried to tamp down his investigation of harassment and assault allegations against Harvey Weinstein. NBC News denies the claim. The book contains new allegations against [...]

More From Our Brands

Access exclusive content