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July 22nd, 2009

redboxNothing to do with Red Camera, or Redsox, Redbox is the familiar DVD vending machine found in over 17,000 locations like convenience stores, grocery stores and pharmacies across the States, and of course in McDonald’s where it all began.

Now independently owned, Redbox has just done a deal with Sony’s Home Entertainment, the first publicly disclosed deal with a major studio.  Even with the modest $1 a night rental, renting DVD’s from vending machines has become a source of huge revenue and Sony expects to make around $450m over the next five years.

While some executives in the home entertainment biz are concerned that Redbox is significantly undercutting rental prices at traditional outlets like Blockbuster, others are concerned about how it may affect DVD sales.  However, lower DVD sales have been offset by the rise in Blu Ray sales, more expensive per unit and rentals are up over 150%, thought to be largely fuelled by vendors like Redbox.

Looks like the things you most want are cheapest in the US – DVD’s and petrol.


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