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Summary:

Redbox Instant is available to all after a closed beta test that netted the company tens of thousands of paying customers. CEO Shawn Strickland told us that his company won’t do original content any time soon.

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Surprise! Redbox Instant by Verizon officially launched to the public Thursday, just as I had predicted in an earlier story. The launch comes after a three-month-long closed beta test that Redbox Instant CEO Shawn Strickland characterized as a great learning opportunity during a phone conversation Thursday morning. “Now we are open for business,” he added.

Redbox Instant currently offers its subscribers access to 4,600 subscription titles and four Redbox DVD rentals for $8 a month. Customers can also digitally rent or buy around 4,000 movies for a fee to augment their subscriptions with newer fare. Strickland told me that the service saw interest from “hundreds of thousands” of consumers who signed up to join the closed beta test. Tens of thousands not only joined for a free trial, but stayed around to become paying customers after their trial period ended.

So who are those Redbox Instant customers? Strickland said that the beta test confirmed the company’s belief that it was primarily catering to people who still value physical rentals. “It’s a disc plus offering,” he said, with streaming supplementing DVD rentals. That’s also reflected in the type of content the company is making available for streaming. “It clearly starts with movies,” said Strickland, adding that the focus might evolve over time.

That approach is very different from Netflix, which also started out with a movie-focused DVD service, but now invests heavily in TV content. Does that mean Netflix and Redbox are going to be complementary, as opposed to arch-enemies? My conversation with Strickland left me with the impression that he would be okay with that — as long as people are paying for his company’s service as well.

“We think that the over-the-top space will evolve very similarly to the cable and network space,” he said. Meaning: You might get your content from more than one streaming provider in the future, just like you get it from more than one cable network.

Of course, a large part of the rise of cable networks like HBO or even AMC has been the production of original content, something that has been an increasing focus of Netflix and Hulu as well. CAA agent Peter Micelli speculated a few days ago that Redbox Instant may venture into original content as well. Strickland called this kind of talk “really premature,” explaining that Redbox Instant doesn’t even have enough insights into what kind of exclusive content its subscribers could be interested in yet. But he added: “From an industry perspective, there is a clear force in that direction.”

  1. Exclusivity is less important when Redbox Instant is charging less than its competitors. Arriving late at the party has its disadvantages, but can also be a great platform to launch from. Redbox Instant will get the attention for a bit, and (if attention is utilized effectively) will break into the streaming business rather than ease into it. Redbox Instant has some unique features including movie focus (as opposed to Netflix’s TV Show focus), physical DVD rentals, and a HUGE group of current Redbox DVD patrons. I predict Redbox Instant will be quickly successful, beyond the predictions.

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  2. spotmagicsolis Friday, March 15, 2013

    IMO, the service quality is *not* the point! The elephant is in the room. Big Phona controls some of the access points and can monkey around with Net Neutrality. If not identified, monitored, overseen and regulated and phone companies can put the squeeze on other streaming services with no traces. Something has to be done! They have figured out that they own the pipes and are in the position to cause a lot of pain to competitors. Big Phona is already going after the radio industry because they smell blood dripping from Bain’s Clear Channel and are lobbying to squeeze out AM/FM first, out of cars. So beware of the tyrants who play with an unfair advantage and have more money than God to force through their agendas.

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  3. Audrey Gardens Friday, March 15, 2013

    We need a Redbox in Margretville or Phonecia NY, otherwise we have to drive 40 miles for a DVD in Kingston NY.. Not doable.

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  4. Phillip Dampier Saturday, March 16, 2013

    Your 30 day free trial will be 30 days of your life you will never get back.

    Streaming problems galore on a teeny-tiny streaming library that requires you to pay extra for titles you actually want to see. The apps are built not to work on rooted phones, and we know what big, overbearing phone company was responsible for that!

    The business plan here is a nightmare and investors have every right to be annoyed. You can rent the physical DVD at the kiosk for far less than paying for on demand access. Verizon ignores the fact Redbox customers are ex-premium/PPV customers who have gotten price sensitive and don’t consider renting/returning movies at a kiosk to be a deal breaker if it saves them money. The kiosk credits are the only thing that might attract Redbox customers, but they eat into revenue and still require an $8 up front investment every month. I see huge churn in their future.

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  5. Michael Murdock Thursday, May 16, 2013

    Love the service. Would love it even more if it was on ROKU or AppleTV since I own both, but one can always wait for such things. AIRPLAY would be a nice addition so we could throw it onto our larger screens through AppleTV…HINT HINT and that should be possible since you have an iphone and iPAD app

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