Red States versus Blue States is so 2008. The newest red against blue contest is the Battle of the Boxes. In this corner we have Redbox, the dominant player in the industry with nearly 20,000 kiosks in operation nationwide. In the other corner we have the challenger, Blockbuster Express, which is on track to have 10,000 boxes of its own in the next year, outnumbering regular stores.
Alex Camara is in charge of ATM-maker NCR’s partnership with Blockbuster. NCR is the company that produces the blue boxes now slowly beginning to compete with Redbox kiosks.
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Camara has a unique viewpoint in this battle, having worked for Redbox parent company Coinstar for ten years.
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In a recent interview, Camara had the following to say about how the Blockbuster Express kiosks differed from their red counterparts:
“Our capacity is about double that of our competitor’s, so we’re not limited to just new releases—we’re able to stretch beyond that. For instance, we’re going to do a campaign around the Sundance Film Festival.”
Camara also discussed the digital capabilities of the blue boxes, saying that NCR has made a ‘sizeable investment” in systems that would be able to download movies and music from the Internet and transfer them to mobile devices or burn them onto discs. Further details about the new systems will be revealed in an announcement “within the next couple of months”.
Regarding Redbox’s legal spats with several movie studios, Camara said:
“We’ve sort of made it clear that our belief is clearly that the consumer expects us to be able to provide day and date DVDs, and our commitment is to be able to do that, but we want to be able to have a working partnership with studios.”
Without going into any real specifics, Camara has make it clear that Blockbuster is putting a lot of hope/resources behind its kiosk business. Your turn, RedHeads. Will it be a quick TKO for Redbox, or does Blockbuster have a fighting chance?
[via Video Business and Contact Music]
i love to see both of these boxes side by side… and tons of coupons : )
though with lack of good movies coming out it be hard to find stuff to use them on.. with the meijers and the other code this week it was very hard to find 4 movies to rent
I think Blockbuster is coming into the game too late, but then again there are millions of people that used to patronize and therefore keep Blockbuster in business when Hollywood Video was CLEARLY the cheaper and better deal. I never understood why, the only reason I can think of was brand name, so if they have a chance at all that would be why. And a broader selection with the ability to burn or download a copy might give them an edge also.
I will give BB an equal opportunity to use codes to score my free movies.
What I would really like to take advantage of, is if they could somehow combine it with their monthly membership, and you could exchange movies you got in the mail or something. But I don’t see how that could ever work…
Shane…
The more the merrier!
Redbox has the edge right now because Blockbuster Express has *no* website for their kiosks.
If, and this is a big if, Blockbuster Express can set up a website similar to Redbox’s [just like Blockbuster.com vs. NetFlix.com], offer *more* title choices and locate vending machines within proximity to Redbox’s than *consumers* win.
Isn’t that what its all about?
They do have a website: http://www.blockbusterexpress.com/
Thanks for the update!
BE’s nearest vending machine is 400 miles away!
Yeah, the nearest one to me is about 20 or 30 miles away. It will take awhile before there’s enough of them to be at your nearest corner like Redbox.
Since BB has messed up with so many people, it’s really going to come down to
1) location, location, location and 2) coupons and freebies.
Blockbuster has made all these same claims in the past… they are doing poorly and this is their last-ditch effort to pass up redbox. Blockbuster has had to borrows millions to do what they are doing…. they will not be charging $1 for their movies either…. it won’t work…. sorry Blockbuster…. aint gonna happen! Redbox is here to stay, and improve and keep us watching movies for $1 for years and years to come!
I’m pretty sure Blockbuster will be happy to let the bottom-feeding coupon crowd stay with Redbox while they provide a wider and deeper selection to those who actually like movies and are willing to pay for them.
This will be the final nail in the coffin for Redbox. They will disappear by 2012.
Boy, is that wishful thinking. And not supported by anything that’s actually happened, only by projections of people who have a lot to lose if Redbox survives.
Unlike many here, I don’t believe $1 movies are here to stay. That will change, though not to the too-high prices the studios and Blockbuster want. And Redbox will adapt and survive, and customers will stay.
I love the redbox at least u can find a list of where they r located.
Redbox’s success is due to price and convenience. If a competitor matches or beats them most customers will switch without hestitation.
Really, if you have a BB kiosk a mile from you with the movie you want, and a Redbox kiosk with the same movie 3 miles away, which will you go to? BB of course. Very few people will go out of their way to a Redbox just because it’s Redbox if a BB is more convenient. Unless Redbox or BB make mistakes to anger kiosk customers, most won’t care.
Loyalty programs (e.g. rent 5 get 1 free) are what other industries have done to solve this problem and hold on to existing customers. I am unimpressed by Netflix’s programming and infrastructure, so I don’t know if they can do it. Of course, if history is any guide there’s no way BB can do it either so it may not matter. But maybe BB has figured out this is their last chance to get things right and save themselves…
Basically, the BB Express machines are re-branded and re-named versions of boxes from “The New Release”, which, until about Springtime this year, had boxes in all the Kroger locations close to me. I’m willing to bet you won’t have the convenience of returning DVDs to any kiosk like RB but you’ll probably have to return the disc at the kiosk you rented it at, which was the case with “The New Release” kiosks. I also think the RB kiosks are better and more modern-looking than the BB Express/NR boxes. Also they’ll have to keep the price at $1 or they’ll be dead in the water.
What’s Blockbusters stance of editing content out of movies and not allowing NC-17 movies. Is that still the same. I never got over them telling me what I can or can’t see.
This could keep kids from renting R rated movies though. They could make it so you have to swipe a Blockbuster Membership Card which parents set the kind of movies their kids can watch.
But, unless they keep it at $1 like redbox people will not rent from their machines.
It looks like they will charge only a dollar, but then does that mean they will honor the studios’ 28-30 day rule on new releases?
If that’s the case, then I would think Redbox will continue to have newer releases than BB kiosks…that is, if Redbox will continue to stock their machines with retail bought dvds…
Redbox cannot afford to do this over the long term. They lose $5-10 per copy of a title that they buy at retail.
BB will be able to get the same if not better deals from the studios that Redbox has managed to get (remember, BB is still more valuable to the studios than Redbox is).
Your numbers don’t add up.
When they buy it at retail, Redbox doesn’t stock as many copies of a title. With fewer copies comes higher utilization of those copies. So instead of sitting unrented in the box half the week, they are out generating more income per copy. And they can be left longer on average in inventory, so they generate income longer.
And then when it comes time to retire a copy, Redbox can sell it off for $7 or so. Their deals with the studios have provisions that DVDs must be destroyed instead of sold, in exchange for a nominally lower purchase price, so it appears that Redbox can make money without having to sell the DVDs. So when they can sell them, some of the price they receive offsets their higher initial cost.
The bottom line is, your analysis is simplistic and ignores the fact Redbox can manage their business to offset the additional costs.
If you think Redbox will be able to sell off their Used DVDs for $7.00 you are in dreamland.
It may be possible that blockbuster is just trying to throw their hat into the ring but have no intention to compete with redbox entirely. Look at how they dealt with their online total access rentals- there was very good incentive such as cheap prices as well as unlimited exchanges and now they limited their exchanges for the cheap plans and expect users to pay premium price for the unlimited. They don’t seem to care that they are the best just available for every option it seems.
Maybe they think just their name will do it all?
What’s the point of “systems that would be able to download movies and music from the Internet and transfer them to mobile devices or burn them onto discs”? Why would someone drive/walk/fly/skip/hop/go to a kiosk to do something that most expect to be able to do on their computers?
Imagine if Apple required people to “download … music from the Internet and transfer them to mobile devices or burn them onto discs” but only at the kiosks at their Apple Stores.
This is really an NCR project. Blockbuster gets a percentage of every rental and provides the branding but the driving force behind the venture is NCR.
These machines will have a much larger selection of titles than Redbox does. It will provide much better value than Redbox. But it really comes down to location and convenience.
What it all boils down to me is; prices, selection and locations. Unless it’s a movie Redbox doesn’t get I see no incentive to spend more money to watch a dvd if I don’t have to. Plus Redbox gives out free codes(less than they used to but it’s still something). There’s a Redbox at the Grocery Store nearby, I looked online, there isn’t one Blockbuster Express in at least 50 miles. I know that could change but I wonder how long it could take. It depends how Blockbuster plays this hand.
I hope that they both expand! I love my RedBox rentals, but there is not a Blockbuster even close to me!! As long as Blockbuster is doing dollar rentals I think neither one will go out of business. It will be nice to have different boxes set up at different locations. That way if something is out at RedBox go to Blockbuster.I would like to see tv series and older movies in there too.
Since redbox still hasn’t brought blu-ray to the kiosks where I live, if BB carries blu-ray in their kiosks, I’ll pick blue everytime and won’t look back.
I hope blockbuster integrates their online service with these kiosks but from the sounds of it, that won’t happen any time soon.
Great to have a choice now! I have a Redbox at my neighborhood Walgreens, and directly across the street, a new BB kiosk at the Publix grocery here in Ocala, FL.
I am going to check it out today, and see what their regular price is, plus the selction of movies. Of course, just like Redbox, the first one is free after signing up at their website http://www.blockbusterexpress.com/
Thanks to MovieCrazy above for the link!
Here’s more information about the Blockbuster Express http://www.macrointegrations.com/blockbuster.html
The blockbuster express kiosks are available to smaller retailers and convenience store chains. They are also targeting universities. It’s a good program with a very recognizable name. NCR is driving this. Smaller retailers only need to provide power and space. NCR provides the kiosk and installation.