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Redbox Passes 500 Million Rentals

Redbox recently announced that it has passed the 500 million movie rental mark. In just a few short years, it has gone from a tiny upstart to one of the major players in the DVD rental industry.

In light of such a tremendous accomplishment, it seems appropriate to take a quick look back at Redbox’s history and share a few fun facts:

  • Redbox began in 2002 as a joint venture between McDonald’s and Coinstar. 140 rebranded kiosks, operated by DVDPlay,cake were placed at McDonald’s restaraunts around the Denver area. Coinstar purchased full ownership of Redbox for $175 million in February of this year.
  • In 2007, the number of Redbox kiosks passed the number of Blockbuster Video locations.
  • Redbox reached 100 million DVD rentals in February of 2008.
  • The DVDPlay machines were phased out in 2005 in favor of a new, custom-designed machine. These machines can hold more than 600 discs, and contain anywhere between 70 to 200 titles.
  • The average Redbox DVD is rented 15 times during its lifespan in the machine. Used DVDs are returned to suppliers or sold at a reduced price from the kiosk.
  • Redbox plans to have more than 20,000 kiosks in place by the end of 2009.

It took Redbox six years to reach 100 million rentals, and now it’s crossing the half-billion mark just 18 months later. What say you, Insiders—Facing increased hostility and intransigence from studios, can Redbox keep the momentum going? Is the one billion mark right around the corner?

[via Associated Content and Wikipedia]

50 Responses to “Redbox Passes 500 Million Rentals”

  1. Member [Join Now]
    moviecrazy

    At the rate they’re going they’ll pass the billion mark in no time, especially if things go their way in the pending lawsuits with the studios. I only wish I had known about them a long time ago because I feel like I’ve spent a lot more money on movie rentals than was necessary!

  2. Visitor [Join Now]
    Jim [visitor]

    500,000,000 rentals

    2,366 were paid rentals
    499,997,634 were rented with free codes.

    • Member [Join Now]
      moviecrazy

      Yeah, and they’re still in business….RIGHT!

    • Visitor [Join Now]
      Carson [visitor]

      Haha, I wouldn’t doubt it

    • Visitor [Join Now]
      JJJ [visitor]

      Problem is, there’s codes I can use now but there ain’t no movies I want to rent.

      The selection SUCKS!!

      • Visitor [Join Now]
        John Small [visitor]

        The selection is only going to get worse. Most of the best titles will not be available at Redbox in the 4th Quarter.

        • Visitor [Join Now]
          Robert [visitor]

          Like “Bring it On 4” and other great Universal titles…

        • Member [Join Now]
          Mark [rb123456789]

          That is untrue.

          When Redbox has to buy titles at retail, they might skip some less popular movies which are unlikely to rent enough times to pay back their increased cost. But so far the “best” (as defined by popularity) have still shown up in Redbox Kiosks even if they are from Universal et al.

          • Visitor [Join Now]
            Joey [visitor]
            I work for VBG. To find out why this is important, click here.

            That’s because the other studios havn’t shut them off yet, that doesn’t start until Oct.

          • Member [Join Now]
            moviecrazy

            That’s right and they will continue to show up in Redbox kiosks because they will do the same thing to get the other studios movies that they do for the Universal movies, so as usual Joey doesn’t know what he’s talking about and he’s hanging on to the thread of hope that the studios will put Redbox out of business. Keep hoping Joey, that’s all you really have is hope! As far as not having many “good” movies out lately, that has NOTHING to do with the lawsuits with Redbox. That is just because there has not been very many “good” movies released lately. Fall is known for not being a very good time for dvd releases.

          • Member [Join Now]
            Mark [rb123456789]

            Joey, you could be right, you might have more insight into the situation than others here. But everything we’ve seen so far from Redbox indicates that if other studios do cut them off Redbox will just go ahead and buy popular titles at retail with no hesitation or impediments.

            You are saying that will change, but have offered no good explanation why it would. Which is why so many doubt you.

            Keep in mind Universal has said in their court filings that they haven’t tried to influence retail outlets not to sell to Redbox. There is a good chance that would be against antitrust laws.

            Actually, I think the delay until October was meant to give the sides time to negotiate. If everyone here is wrong and in fact Redbox is screwed like you claim, they will almost certainly get a deal done soon and the point wil be moot.

          • Visitor [Join Now]
            Joey [visitor]
            I work for VBG. To find out why this is important, click here.

            Ok here’s your insight or my point of view……….
            Yes Red box has had Universal titles although late getting them in there. when found in the machines the copy depth has been what 6? 8? copies of a Universal title compared to the 50 or so of a major release from another studio. Have you ever tried to search your area for a Universal title? You’d be lucky to find 1 out of 10 with a copy of a decent Universal title. Why is that? Because they are paying retail price on something that they are lucky to break even on. Half the reason they are even carrying any Universal titles is so the consumer don’t become disinfranchised with them in their market share mode they are in.

            So now enter October/November
            Instead of not having access to 13% of the studios releases that # jumps to 60%. Once this happens consumers will react to the decreased copy depth and lack of availability and the frustration this will cause. Enter into this equation that red box entered into contracts that force redbox to carry crappier secondary titles and this all equals disaster for red box and significant decresses in revenue. Also each person who stocks these machines is going to have the added cost and added hassle of running around to every wallmart,best buy,and wherever else buying as many copies as they are allowed and then go out to their van, car or moped and repackage each one and stock it into the machine. So this equals….. that yes they still have access to these other studios but they will be late getting them into the machine and the availability and convience is going to take a huge hit. All the while losing money or breaking even on over half of the titles (remember they only had a 2% profit margin to begin with)

            And as for your point about this getting resolved with the studios. I would say the only way the studios are willing to resolve this will be with 30-45 day windows for red box. The problem with that is the first 45 days is when most of the revenue is generated by a rental.
            As has been stated on here in another article .. the studios aren’t willing to trade dollars at sell thru for pennies with rentals and that’s excactly what red box is proposing to them.

    • Visitor [Join Now]
      Stop Whining [visitor]

      Ah hahahah
      Shhhh, let’s keep it a secret!!
      But, congrats to redbox that is a phenomenal feat, codes or no codes
      Hope they are around for years to come and Michael’s bad ass site

  3. Visitor [Join Now]
    monkey [visitor]

    Shane is doing a great job. I enjoy reading his posting.

  4. Visitor [Join Now]
    Joey [visitor]
    I work for VBG. To find out why this is important, click here.

    Also I think redbox is having the same effect on small communities as wallmart has. Running business after business into the ground (corporate machine)

  5. Visitor [Join Now]
    Joey [visitor]
    I work for VBG. To find out why this is important, click here.

    Here is some more #’s for you
    Universal denies Red box “Fast and the Furious”
    DVD Sales Performance
    Released on DVD: July 28, 2009
    DVD Units Sold: 2,720,547
    11th best DVD seller of the year (better then expected)

    Movies 2009 (Theatrical) Gross Tickets Share per studio
    (alot of these movies comming out in 4th quarter when red box is denied access)
    1 Warner Bros. 29 films 20.84%
    2 Paramount Pictures 13 films 17.32% (Revenue Sharing with Red Box)
    3 Sony Pictures 16 flims 12.28%
    4 20th Century Fox 19 films 12.17%
    5 Buena Vista 15 films 11.44%
    6 Universal 17 films 8.99%
    7 Lionsgate 8 films 3.81%
    8 Fox Searchlight 7 films 2.88%
    9 Summit Entertainment 9 films 2.24%
    10 Weinstein Co. 6 films 1.89%

    • Visitor [Join Now]
      John Small [visitor]

      The evidence will become more and more clear, over the next 6 months, that Redbox kills the revenue of a title. The studios that made a deal with Redbox will likely do alright since they got Redbox to pony up more than their proper market share. But the real winners will be the studios that deny Redbox their titles. Their titles will continue to out perform the Redbox titles.

  6. Visitor [Join Now]
    filmflam [visitor]
    I work for VBG. To find out why this is important, click here.

    Red box is screwed

  7. Member [Join Now]
    captmovie

    Redbox will beat the movie makers like a red headed step child

  8. Member [Join Now]
    ChadCronin [chadcronin]

    The studios can try to keep titles away from people. Like I mentioned before. If I really wanted to see a title I would see it in the theatre and buy it on Blu-ray. That’s only for a few select titles. Most I would just rent and if they aren’t in Redbox, then who cares. Their loss.

    • Visitor [Join Now]
      John Small [visitor]

      Ahh, but you see, the studios don’t mind you watching the movie for $1.00. They just want you to wait 30 days after street date before you get the chance.
      That doesn’t seem unfair does it?

      • Member [Join Now]
        ChadCronin [chadcronin]

        Everyone pushes this 30 days like it’s no big deal, but it is a huge deal. They are trying to push business towards other companies and anything that hurts Redbox is bad. I have already gotten a very sour taste in my mouth over all this and have mostly stopped what was my weekly purchases of movies. For the most part now I don’t care enough on what the release date is. I just want to see one rule for everyone. If they think going back to having purchase before rental, then they can do it, but signing revenue share with some but not others, I’m not into that.

        • Visitor [Join Now]
          John Small [visitor]

          Ah, but there lies the problem Chad.

          Redbox is not playing by the same rules as everyone else.

          That is what the studios are trying to get Redbox to do.

          If a regular rental store does revenue sharing, they have to pay MORE than $1.00 per turn of a DVD.

          If a regular rental store does not do revenue sharing, the must pay the wholesale price (which is about the same if not a little more than the Walmart retail price).

          Redbox was trying to get away with doing neither one of these options.

          The studios rightly stepped in and protected the market by demanding that Redbox play on a level field. If they refuse to do so, then they have to wait 28 days to get their movies directly from the studios.

          Redbox does, of course, have the option of buying their movies at the wholesale/retail price if they want. However that would put Redbox out of business so they refuse to do so.

          Don’t be fooled. It is Redbox that wants an uneven playing field, not the studios. Redbox is in the wrong here.

  9. Member [Join Now]
    alans613

    Joey, Redbox DOESN’T EVEN RENT Weinstein Co. DVDs! Remember, they have an exclusive deal with your employer, Blockbuster Video. Why you included their number is beyond me. Also, “Fast and Furious” was in the Redbox locations in my area by July 31st, three days after “F&F” was released on DVD. Who’s to say that RB didn’t HELP sell some of those DVDs after a rental at the RB? RB will win in the end, no question about it.
    RB is killing off Blockbuster because they refused to alter the way they ran their business with $5 per night rentals and bad service.

    • Visitor [Join Now]
      Jim [visitor]

      If you really believe that only Blockbuster rents The Weinstein Company DVD’s, then you truly know nothing about this industry. Every Independent in this business will have Weinstein titles the very same day that Blockbuster has them.

      P.S. – Most Weinstein titles are pieces of shit, anyway.

    • Visitor [Join Now]
      Joey [visitor]
      I work for VBG. To find out why this is important, click here.

      that’s excactly why I put Weinstein in there because that’s one more studio redbox doesn’t have ( kind of the point to what I wrote)

  10. Member [Join Now]
    kduit

    As long as ALL rental outlets are denied access to movies on street date, then no one should complain. But it seems that ONLY Redbox is being singled out.

    • Visitor [Join Now]
      Joey [visitor]
      I work for VBG. To find out why this is important, click here.

      Because Red box is the only one who is Devaluing packaged media with the $1 a day pricing and free movie codes.

      • Visitor [Join Now]
        rb [visitor]

        Just curious Joey…. Do you rent from or use Redbox at all? If not, what’s your purpose here? We all have grips with Redbox over one thing or the other, but you can’t seem to find one positive thing about Redbox.

      • Member [Join Now]
        kduit

        Netflix cost per movie can be less than the $1 a day. Plus there are other small players in the rental kiosk business that still seem to get the movies.
        If Redbox is able to make a profit at their price point, then so be it. A rental is a rental no matter where you rent it from. The only difference to the end consumer is the final cost.
        I’m more concerned with Redbox being the target of the movie studios. It should be an all or nothing policy.

      • Member [Join Now]
        moviecrazy

        That’s just it Joey, Redbox is NOT the only one (supposedly) devaluing packaged media! So is Netflix, so why do you only single out Redbox? What is your obvious personal beef with them? Like I’ve said before you’re never fair in your argument and your arguments have absolutely NO merit! If you were really sincere in your stand you would mention Netflix etc… but you don’t, so it’s OBVIOUS you have a personal beef with Redbox…what’s wrong, wouldn’t they hire you or something? Are they making your little Blockbuster suffer? Awwwwww……Give it a rest already!!!!!!

        • Visitor [Join Now]
          rb [visitor]

          Joey is probably that Redbox kiosk worker who left his duffle bag of 30 new release Redbox dvds unattended outside next to the Redbox kiosk while he went inside the store for whatever reason. Yeah, that’s it! Joey got fired by Redbox when he was reported for being irresponsible and rude! We’re onto you now, Joey!

          • Member [Join Now]
            moviecrazy

            LOL!!!! Yeah he probably got fired from Redbox for being totally incompetent and a jerk (which is his normal for him) and as usual he just can’t figure out why they fired him so now he has a personal vendetta against them! Good job figuring him out “rb says” , now it all makes sense!

  11. Member [Join Now]
    UBM [ubm]

    Packaged DVD media, like packaged CD media, has been overpriced
    for many. many years. Most DVDs sell at $20 bucks to
    about 3% of the population of the US on the first day of release.
    The majority of the sales of DVDs happen after the title
    has matured in release and has come down in price.
    Titles that are $20 a pop on Tuesday, 6 months move
    to the $11 dollar rack at wal-mart, then go on sale
    for the Xmas season at $6 to $8 a pop, then after christmas
    move to the $5 section.

    Smart consumers know this, and smart businesses ( Like Disney)
    know this, that’s why they pull their titles off the shelf
    before they would reach the $5 section.
    YOU’LL NEVER SEE CINDERELLA or SNOW WHITE for $5 at walmart
    and this is why!

    A business that isn’t smart enough to face consumer trends will
    destroy itself. And Redbox isn’t the only business devaluing DVDS,
    look at Apple with the iTunes Store…remove the physical product
    (plastic disc, plastic box, and printed paper) and the movie’s true value is
    exposed for what it’s worth ($4).

    The problem is the movie studios got greedy: They took a product
    ( a movie) and repackaged it nine different ways to sell to a customer
    over and over again
    ( DVD, Blue Ray, BlueRay Combo, Cable Subs, VOD, Digital Copy,
    Digital Download, Rented DVD, Rented BluRay) and then took
    away consumer’s rights and thought the consumer would just
    roll over and take it! Well now, the consumer is fighting back
    and choosing what they want instead for just taking what the
    studios are feeding them.

    I say, good for the consumer!

    And when they institute the 45 day rental window ( on everybody)
    and Wal-Mart is overstocked with crap they can’t sell and
    DVD rental continues to soar, then maybe they’ll get the hint…..

    • Visitor [Join Now]
      rb [visitor]

      Amen!

    • Visitor [Join Now]
      h0mi [visitor]

      “The majority of the sales of DVDs happen after the title has matured in release and has come down in price.”

      This isn’t consistent with this:

      “Most DVDs sell at $20 bucks to about 3% of the population of the US on the first day of release.”

      I’m not sure if you’re saying most sales are in the first few weeks or after the prices have come down. In any event, most DVDs sell the most discs in the first few weeks of the DVD’s release, not later. After 2 months, sales crash through a floor and are negligible. Those discounts occur in order to move product and get them out the door after languishing in stores; those $5 bins exist filled with titles nobody wants, nevermind at $10+. Most people who wanted those titles already bought them.

      Click on any title in the top 30 of last week:

      http://www.the-numbers.com/dvd/charts/weekly/thisweek.php

      and you’ll see the same pattern. Most sales are in the first 10 weeks, sometimes most sales are in the first week or 2.

      “And Redbox isn’t the only business devaluing DVDS,
      look at Apple with the iTunes Store…remove the physical product
      (plastic disc, plastic box, and printed paper) and the movie’s true value is
      exposed for what it’s worth ($4).”

      Those $4 itunes movies are rentals, not purchases. Purchases are $10-15, and TV shows are ~$2 a show, with varying prices for an entire season; 1 show I bought was $15, others are $30+ for a season… YMWV.

  12. Visitor [Join Now]
    Joey [visitor]
    I work for VBG. To find out why this is important, click here.

    UBM you actually make my point for me. As you say a DVD is only worth $4, This is excactly what Redbox has done…. they have taken the perceived value and in consumers heads made them think it is worth only $4 or only $10 or whatever they perceive it’s worth being. 5 years ago (before Redbox) this wasn’t the case. with the $1 a day rental price structure they are changing the perception of packaged medias worth, in other words Devaluing it. If the consumer thinks your product is only worth pennies that’s all they will pay regardless of what the true value is. A DVD is worth more then $1 at rental and it’s worth a hell of alot more then $4 at retail. Which is why they are not allowing redbox to continue to distroy the entire industry I hope.

    • Visitor [Join Now]
      rb [visitor]

      Wrong! The “crap” the studios keep turning out has devalued the worth of dvds/media. You can’t fault the consumer for realizing that much of what the studios have been turning out is “crap” and, therefore,you can’t blame Redbox for understanding consumers are no longer willing to pay a high price to build a dvd collection of potential crap without first “trying before buying” the dvd–that is renting first to see if the dvd is even worth buying..

    • Member [Join Now]
      moviecrazy

      I’m just curious Joey, what movie studio or part of the movie business do you work for anyway? It’s obvious you work in the movie industry so I was just wondering who you put out this worthless drivel for. And by the way, IF the movie industry goes out of business (and that’s a HUGE if) there are other places to work…just so you know.

  13. Visitor [Join Now]
    Lazarus Long [visitor]

    You guys are one step above pirates. In fact I suspect if the MPAA asked for your registration info from this site they would have a fun time looking at your hard drives.

    I think maybe an email to the authorities is in order. I’m sure this site doesn’t want criminals on it.

    • Member [Join Now]
      Mark [rb123456789]

      LOL. Posts like that have made you guys the Larry, Moe, and Curley of this site.

    • Member [Join Now]
      Carson [carson]

      Pirates (and one step above) give fake registration information, Arg!!

      All in all, this whole thing is hilarious, whatever happens, I’ll rent my DVDs the cheapest way possible, and if that ends up being $4, I’ll rent maybe 4-5 per year.

      • Visitor [Join Now]
        John Small [visitor]

        Again, this makes you worthless as a consumer which renders your opinions worthless.

        No company wants a customer like you Carson. Especially not Redbox.

        • Member [Join Now]
          Carson [carson]

          But I tell everyone I can about Redbox and the free codes, introducing new people to the service all the time, I’d like to think that Redbox and I have a give and take relationship…