After the dust settled a bit from the huge announcement earlier today regarding a 28-day new release delay agreement between former foes Redbox and Warner, several analysts, industry players and the participants themselves weighed in on the deal.
Fox, which remains legally entangled with Redbox said the following in a statement:
“We support a vending window in light of the changing rental landscape and we are looking at a variety of new approaches. . . Since we are in litigation with Redbox, however, our policy is that we are unable to comment further.”
Kevin Tsujihara, president of Warner Bros. Home Entertainment minced no words about his studio’s motivation behind the deal:
“We want to move consumers to activities such as retail rental, video on demand and buying that have the best economics for the studio . . . Those who want to pay $1 and are willing to wait, God bless them.”
Redbox president Mitch Lowe seemed to acknowledge defeat in Redbox’s attempt to circumvent Warner’s efforts to deny it new relase titles, but tried to spin the deal in a positive manner:
“We were not serving our customers by getting them enough copies of the titles they wanted . . . This seemed to be the best way to give our customers more copies and get a deal that made economic sense . . . We’ll get a lot better selection and we’ll get the [copy] depth that matches the demand . . . That, along with [access to] Blu-ray titles and significantly lower [disc] costs makes this a really good deal for us and Warner.”
Merriman Curhan Ford analyst Eric Wold was, as always, bullish on Redbox:
“Knowing that Redbox would not enter into any studio distribution deal that has lower economics than what the company was experiencing on its own with the workaround programs, then I view this as a strong positive . . . Clearly management has calculated an equal or upside margin benefit to moving towards this deal. This and the removal of the lawsuit should remove some clouds from the company’s outlook and stock price.”
Michael Pachter, with Wedbush Morgan, was a little more sanguine in his take on the agreement’s benefits to Redbox:
“As long as all rentailers are on a level playing field, it’s good for Redbox . . . So far, we know about Netflix and Redbox, but we don’t know about Blockbuster. If Blockbuster gets a 28 day head start, then it’s not so good.”
Now it’s your turn to weigh in, Insiders. Now that the Hollywood Three are down to the Hollywood Two, will it be long before the ink dries on a Redbox deal with Fox and/or Universal? What is the DVD rental market going to look like in six months? Do you think there will be a net benefit to consumers from this deal?