Champagne glasses are surely clinking at the Redbox offices today, as Paramount has announced that it will extend its relationship with Redbox for at least another six months. The highly anticipated decision from Paramount comes at a time when most other studios have clearly stepped to one side or another of the Redbox line, with Sony, Disney and Lionsgate making deals with the kiosk renter and the notorious Hollywood Three (Warner, Fox, Universal) in adamant opposition.
Paramount opted for a more methodical decision-making process, signing a short-term deal with Redbox that expired this month and had the option of being extended. Paramount clearly wanted to analyze the positive or negative financial impact such a deal with Redbox would have before throwing down with its allies or its opposition.
According to Home Media Magazine, Paramount new release DVDs “will continue to appear on street date in Redbox kiosks through June 30, 2010, at which point the studio will have the option of continuing its revenue-sharing deal through 2014”. Paramount also retains the option of terminating the agreement in December of 2011.
Dennis Maguire, worldwide president of Paramount Home Entertainment, offered the following regarding the extension:
“We are enjoying our business relationship with Redbox and the data from our initial trial period has been encouraging. . . We are extending the time period that we have to exercise our option in order to give us more time to assess the long-term potential of this business relationship.”
Redbox president Mitch Lowe had similarly positive remarks:
“The extension marks another positive step forward in our relationship with Paramount Home Entertainment. . . This agreement provides our customers with access to Paramount titles the day of release at the more than 19,000 Redbox locations nationwide and underscores our commitment to working with the industry.”
Is the tide starting to turn a little, Insiders? Does this decision make you think Paramount will sign a major deal extension in six months? Why doesn’t the president of Redbox know the correct number of kiosks his company has? Give us your thoughts on all these important questions in the comments.