4 Comments

Summary:

Despite a recent study that concluded Redbox’s low-cost DVD rentals are destroying the entertainment industry, Paramount Home Entertainment  has extended its trial period with the DVD rental kiosk company. With the extension, Paramount — a division of Viacom — has agreed to make new release titles […]

RedboxWalmartPhoto

Despite a recent study that concluded Redbox’s low-cost DVD rentals are destroying the entertainment industry, Paramount Home Entertainment  has extended its trial period with the DVD rental kiosk company. With the extension, Paramount — a division of Viacom — has agreed to make new release titles available for another six months while it evaluates Redbox’s business.

The original agreement, which was set to conclude at the end of December, offered new releases to Redbox in exchange for data about rental trends at different locations. In addition, Redbox promised that all Paramount DVDs would be destroyed after being removed from the kiosks, ensuring that they would not end up on the secondary market and compete against new DVD sales.

The extension suggests that Paramount hasn’t concluded its study of Redbox’s impact on its overall DVD business — otherwise it could choose to exercise an option to fully commit to Redbox through 2014 in a rev-share deal that is estimated to be worth $575 million. Instead, with the new extension the companies have agreed to continue under existing terms until June 2010, at which point Paramount will have the right to extend the option through December 2014.

While Paramount is taking a cautious approach to figuring out Redbox’s effect on DVD sales, other studios are picking sides over whether or not to work with the rental firm. Sony, Disney and Lionsgate have agreed to deals with Redbox, while Warner Bros. (TWX), Universal and Fox are currently stuck in legal battles with the kiosk company.

You’re subscribed! If you like, you can update your settings

  1. wow, this is interesting. fun as well. where is this happening ? i mean which country do you know ?

  2. Redbox Makes Nice with Warner Bros., Agrees to 28-Day Window Tuesday, February 16, 2010

    [...] Hollywood movie studios over the past year or so. Warner Bros. joins Sony, Disney, Lionsgate and Paramount in agreeing to new release windows with the DVD rental kiosk company. Meanwhile, Universal Studios [...]

  3. Blockbuster Gets More Help From Hollywood Wednesday, April 7, 2010

    [...] The deals come as studios seek to push back the availability of new releases through Netflix’s subscription rental service and through Redbox’s $1-a-day rental kiosks. Netflix struck a deal with Warner Bros. in January in which it agreed to hold off shipping new releases for 28 days after they’re available in stores in exchange for more titles for its online streaming service. Meanwhile, Redbox has signed off on similar deals with Warner Bros., Sony, Disney, Lions Gate and Paramount. [...]

  4. Paramount: Redbox Had ‘Minimal Impact’ on DVD Sales Tuesday, June 15, 2010

    [...] conduct such a detailed analysis, using information that it received through a deal which involved data about rental trends at different [...]

Comments have been disabled for this post