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Redbox and Lionsgate, Hear Them Roar

Redbox and Lionsgate have announced a multi-year agreement, according to a press release from Redbox. Redbox will now have greater access to more Lionsgate new release and catalog titles, including childrens titles.

There is a catch, though, as this is the second agreement in the past month that prevents Redbox from reselling previously viewed DVDs. As part of this agreement, Redbox will destroy Lionsgate titles after they are removed from the kiosk.

A quote from the release:

“We believe that the Redbox model will ultimately expand the business by increasing the number of impulse rentals and by putting packaged media rentals in places where none existed previously,” said Steve Beeks, Lionsgate President and Co-Chief Operating Officer. “This agreement gives us tremendous placement for all our films and lowers the impact of low-priced previously-viewed DVDs being sold into the market, which we saw as a growing issue. We believe that this arrangement is a smart opportunity for Lionsgate in the current environment and a win/win for both companies.” [emphasis added]

It looks like these deals are becoming increasingly common, which may indeed take Redbox completely out of the resale market, as I mentioned yesterday. But, as long as consumers still get $1 DVD rentals, I don’t think the complaints will get too loud.

Now, where is the announcement between Redbox and Disney? Perhaps next week…

[full press release]

9 Responses to “Redbox and Lionsgate, Hear Them Roar”

  1. Member [Join Now]
    jakoblin

    This phrase. Does it mean the dvd can not be sold and can not be rented ?
    “There is a catch, though, as this is the second agreement in the past month that prevents Redbox from reselling previously viewed DVDs. As part of this agreement, Redbox will destroy Lionsgate titles after they are removed from the kiosk.”

  2. Member [Join Now]
    ambersjourney

    Well, this doesn’t make any sense at all, and the studios are going to lose out on a selling opportunity. I currently buy new release rentals from Hastings Entertainment stores for about $6 as it is. When they have their promotions, I can get them for Buy 1 Get 1 for $1. Stupid is and stupid does.

    • Member [Join Now]
      Mark [rb123456789]

      Used DVDs for $6 do not represent a “lost selling opportunity” for the studios. The studios already sold those DVDs for $15. If rental DVDs from Redbox and others such as Hastings aren’t dumped on the resale market, consumers will have no choice other than buy a new one, making the studio another $15. Maybe they would sell only half as many, but to them half as many $15 sales is much better than $6 sales where they actually make $0.

      And any DVD you are buying for $6 is either not a current new release or was such a dog that they are just dumping it at that price.

      • Member [Join Now]
        jakoblin

        consumers will have no choice other than buy a new one, making the studio another $15. Where do you buy for $15 ?. in my city these cost over $20.

  3. Member [Join Now]
    Mark [rb123456789]

    An interesting part of this agreement, not mentioned above, is that it guarantees Lionsgate a 7.4% market share of Redbox kiosks.

    This is similar to the Sony deal, which guaranteed Sony 20% market share in Redbox kiosks. That was much higher than Sony’s market share in the overall rental market (10%) which is significant.

    Looks to me like Redbox knows it won’t be getting Fox and Universal titles unless they are willing to pay a premium for them, and is willing to fill their kiosks with lesser titles from other studios which they can obtain profitably.

  4. Member [Join Now]
    ambennis

    Who cares … Lionsgate hasn’t released a movie worth watching with the exception of ‘Crash’. I have been so consistently disappointed with LG rentals that I have sworn them off for good (burned too many times). I think a lot of their movies have amazing potential (good idea or plot) but lack the finale / closing to make it a memorable piece. Just my 2 cents.

  5. Member [Join Now]
    robinrenee

    I TRIED THE FOLLOWING CODES LAST NIGHT, AUG 14, 2009:

    HONESTABE07 – INVALID CODE
    STATES – INVALID CODE

  6. Member [Join Now]
    slidecage

    lionsgate used to put out very good horror movies…cant remember the last time though