Redbox (s CSTR) will soon get into the Blu-ray rental market, according to a report from Home Media Magazine. During a keynote speech at the Entertainment Supply Chain Academy Edge conference last week, Redbox president Mitch Lowe said the kiosk company would use its existing footprint to rent higher-value Blu-ray discs at a premium to its $1 a night DVD rentals.
The company will likely charge $1.50 per night for Blu-ray discs, Lowe said, and those discs could begin appearing in Redbox kiosks over the next few months. The availability of Blu-ray rentals could provide a revenue boost to the kiosk firm. According to Lowe, nearly 17 percent of Redbox customers have a Blu-ray player, and he expects that to increase as more customers become interested in its low-cost rentals.
The announcement comes as Redbox has been striking deals with Hollywood studios such as 20th Century Fox (s NWS), Universal Pictures (s GE) and Warner Bros. (s TWX) that keep it from renting new release titles for 28 days after they become available for sale on DVD. Those deals would also apply to any Blu-ray titles that Redbox would add to its rental kiosks.
While maintaining its low-cost kiosk rental business, Redbox is looking to diversify its revenues with other services. According to Lowe, Redbox will soon test a DVD sell-through service, which would allow its customers to purchase catalog titles for $5, $7 or $9 from the kiosks. The company is also reportedly interested in starting a streaming video subscription service that would compete with Netflix’s (s NFLX) Watch Instantly streaming service.
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