NCR Corp., who licenses the BB name for its Blockbuster Express kiosks, plans for massive growth in 2010 and beyond for its newly created entertainment division. NCR CEO Bill Nuti said in a recent call with investors that the blue boxes represented the “headline event” of the year for NCR. The company plans on an installed base of 10,000 DVD rental kiosks by the end of this year and anticipates $125 million to $155 million in revenue from the blue boxes.
Nuti feels that the market is ripe for a second major kiosk operator and his company has the means to make it happen. Said Nuti:
“The DVD kiosk market is a large and rapidly developing market opportunity where our size, retail relationships and technology leadership position us to be the global market leader for years to come,”
NCR EVP of industry solutions, John Bruno, cited data from The NPD Group saying that self-service rentals would account for 30% of the movie rental market by year’s end. According to Bruno:
“Nearly one in five movie watchers are already renting their DVDs and Blu-rays from rental kiosks like ours. . . This could grow to one in three in 2010.”
Bruno also claimed that NCR is not encountering the same resistance from Hollywood that rival Redbox has encountered, saing that the blue boxes offer multi-channel offerings, including sell-through. Said Bruno:
“[Our kiosk] is not just purely a rental arbitrage, which is why I expect it to be received more favorably [by studios]. . . And it has been.”
According to Bruno, “it takes about a year for a newly installed kiosk to reach its mature revenue level, or about $40,000 in revenue per kiosk annually.” NCR also plans on integrating SD card movie downloading capablilities into its kiosks as digital downloading becomes more mainstream.
The way things are going, is it possible the Blockbuster name could live on only as a sticker slapped on a blue box? How is the rental market going to adjust to a major new force in the kiosk business? Does Redbox have anything to worry about from NCR and its big plans? Leave your opinion in the comments.
(via Home Media Magazine)