Redbox, Warner Strike Same-Day DVD, Blu-ray Disc Deal

Redbox and Warner Bros. June 27 announced a new agreement bringing all newly released DVDs and Blu-ray Discs from Warner Bros. to Redbox kiosks on the same day as their initial release.

Previously, there was a one-week delay. And before the one-week delay was instituted in May 2017,  Warner withheld new DVD and Blu-ray Disc releases from Redbox kiosks for 28 days, fearing that inexpensive rental availability would cannibalize sales — particularly since Redbox kiosks are often situated outside, or inside near the entrance to, big retailer disc sellers such as Walmart.

That rationale is no longer valid, Redbox CEO told Media Play News in February 2018. “We reach a different segment of the market, so I think there’s a better understanding today of the benefits Redbox provides to the studios,” he said. “This view that sellthrough is being hurt by rental, that’s a pretty outdated view of the world, I think. The studios understand it’s a great opportunity to serve a customer base they might not otherwise serve.”

The new agreement with Warner Bros. also maintains new-release and catalog availability via Redbox On Demand at first release.

“We’re thrilled to announce this day-and-date agreement with Warner Bros. that provides the consistently strong slate of Warner Bros. titles to consumers at their earliest physical retail sell-through availability,” Smith said in a statement. “We appreciate the partnership with Warner Bros. in making their content accessible to Americans – whether for rental or purchase, on disc or On Demand.”

“Warner Bros. is pleased to continue our long-standing relationship with Redbox,” said Mike Takac, EVP of  sales at Warner Bros. Home Entertainment. “We’re aligned in our mutual goal of satisfying consumer demand for Warner Bros. content — in any format, across platforms.”

Upcoming new releases from Warner Bros. include Rampage (July 17) and Ready Player One (July 24).

The Redbox retail network now includes more than 41,500 kiosks and has more locations than Starbucks’ and McDonald’s in the U.S. combined. Redbox offers movies and video games for rental and purchase at a great deal, starting at $1.75 a night for a DVD rental.

Redbox On Demand offers many of the same new-release movies available at the Box, and an expanded library of hit movies and TV shows, for convenient rental or purchase On Demand.

‘Tomb Raider’ Tops Redbox Kiosk, On Demand Charts

Warner’s Tomb Raider was the top disc rental at Redbox kiosks the week ended June 25.

The reboot of the action-adventure film series, with Alicia Vikander in the starring role, also debuted at No. 1 on Redbox’s On Demand chart, which tracks digital purchases and rentals.

Another new release, Universal Studios’ Pacific Rim Uprising, debuted at No. 2, also on both charts. The film earned a little more at the domestic box office than Tomb Raider, $59.2 million compared with $57.4 million.

The faith-based I Can Only Imagine, distributed by Lionsgate, was No. 3 its second week out, also on both charts.  The Christian film was a surprise box office hit, taking in more than $83 million at U.S. theaters on a budget of just $7 million.

Another sophomore, Paramount’s Sherlock Gnomes, was No. 4 on the DVD/Blu-ray Disc kiosk chart and No. 5 on the Redbox On Demand chart.

Rounding out the top 5 on the kiosk chart was MGM’s Death Wish remake, which was No. 6 on the Redbox On Demand chart.

Warner’s Game Night was No. 4 on the digital chart and No. 6 on the kiosk chart.

 

Top DVD and Blu-ray Disc Rentals, Redbox Kiosks, Week Ending June 25

  1. Tomb Raider
  2. Pacific Rim Uprising
  3. I Can Only Imagine
  4. Sherlock Gnomes
  5. Death Wish (2018)
  6. Game Night
  7. Unsane
  8. Strangers: Prey at Night
  9. Black Panther
  10. A Wrinkle in Time (2018)

 

Top Digital, Redbox On Demand, Week Ending June 25

  1. Tomb Raider
  2. Pacific Rim Uprising
  3. I Can Only Imagine
  4. Game Night
  5. Sherlock Gnomes
  6. Death Wish
  7. Jurassic World
  8. Red Sparrow
  9. Paul, Apostle of Christ
  10. Unsane

Visit the Redbox website.

Buy or rent Redbox On Demand movies.

Redbox Launches 4K Ultra HD Rentals in Six Test Markets

Making good on a promise it made in January at CES, Redbox on May 22 announced the launch of 4K Ultra HD rentals in six test markets.

4K Ultra HD Blu-ray Discs rent for $2.50 per night, 50 cents higher than the rental rate for regular Blu-ray Discs (DVDs are $1.75). The test is rolling out across more than 2,500 kiosks in Los Angeles, Seattle, Austin, Detroit, Miami, and New York City.

“This is a major move for Redbox as we focus on expanding consumer access to home entertainment options across price points and formats,” said Galen Smith, CEO of Redbox. “As the popularity of 4K content increases and pricing of 4K hardware decreases, we’re excited to offer the best viewing experience at the best price for 4K Blu-ray discs.”

Initially, four high-profile action films will be available for rent in the six test markets:  Black Panther from Walt Disney/Marvel, The Commuter from Lionsgate, Warner’s The Matrix and The Martian from 20th Century Fox.

“We’re starting with a mix of new and catalog titles, so consumers can rent new movies in all available disc formats or go back and experience The Matrix and The Martian in a new way,” Smith said.

New releases and popular catalog titles will be added regularly, and the number of titles and copies will vary by kiosk and location.

“As we go forward, we will try to add movies if not every week, then close to every week,” Smith said.  “Certain titles are not being made on 4K Ultra HD because there isn’t enough demand — 12 Strong, for example, wasn’t made in 4K Ultra HD — so as we start to grow the business with the studios, it’s a great way to partner together and hopefully allow more movies to be made in 4K Ultra HD.”

“Redbox has a history of supporting consumer adoption of new technologies and elevating the quality of the viewing experience,” added Ash Eldifrawi, chief marketing and customer experience officer at Redbox. “Our nightly rental model makes the ultimate viewing experience a great deal that’s more accessible to consumers.”

The 4K UHD test adds to Redbox’s recent rollout of Nintendo Switch video game rentals in six markets nationwide: San Antonio, Portland, Seattle, Nashville, Denver and Salt Lake City.

In December 2017, the company announced Redbox On Demand. The service complements the company’s deal-driven, new-release offering at kiosks and broadens Redbox’s selection of movies and TV shows via transactional video on demand (VOD) and electronic sell-through (EST).

All Redbox rentals, including 4K Ultra HD Blu-ray discs, can be returned to any Redbox location. Consumers can visit www.redbox.com to learn more about the test and required hardware, including the option to watch on 4K UHD-enabled game consoles.

The Redbox 4K Ultra HD Blu-ray rental test comes as players are coming down in price. Best Buy recently began advertising a Magnavox model for $79.99, down from $199.99.

According to DEG: The Digital Entertainment Group, sales of 4K Ultra HD Blu-ray Discs in the first quarter of this year were up 130% from the first quarter of 2017, accounting for nearly 12% of total Blu-ray Disc spending.

In the first quarter of 2018, 4K UHD TV penetration reached nearly 35 million U.S. households and 4K UHD players are now in more than million U.S. homes. Notably, more than 1 million 4K UHD players were sold in Q1 2018 alone, representing one-third of all Blu-ray Disc player sales in the quarter and an increase of 58% from Q1 2017.”

Consumers now have more than 300 4K Ultra HD Blu-ray titles available for viewing on Ultra HD Blu-ray players and enabled game consoles and 438 4K Ultra HD Digital titles, DEG reported.

Smith said he hopes that Redbox kiosk availability of 4K Ultra HD Blu-ray titles will help transition the format from the early adopters to mainstream audiences.

“Obviously it is the very best experience for an at-home opportunity to consume content, so we are giving our customers another choice,” Smith said.  “And by having this format available in our kiosks, it helps to validate it. We want to help the studios take it from a niche product to a mainstream product.”

Smith said he also hopes to aid in the educational effort and alleviate consumer confusion.

“Right now, it’s a little confusing in terms of what you need,” he said. “You need a 4K Ultra HD disc and a 4K Ultra HD TV, and you also need a 4K Ultra HD player. And by us being in the market and being able to communicate with a very movie-loving consumer, we can expand the market.”

Redbox Snags First Exclusive With Rights to New Nicolas Cage Film

Redbox is now exclusively offering discs of The Humanity Bureau, starring Nicolas Cage and Sarah Lind, for rent at all Redbox kiosks.

The arrangement marks Redbox’s first movie exclusive. “We’re always looking for opportunities to add to our content offering based on what we know customers like to watch,” says a Redbox spokesperson.

The Humanity Bureau is the first film released by distribution company QME Entertainment Inc., a joint venture between Quiver Distribution Inc. and Minds Eye Entertainment.

“We’re thrilled to work in partnership with Redbox to ensure that our film The Humanity Bureau will be readily available to consumers nationwide at their more than 41,000 kiosks and Redbox On Demand,” said Berry Meyerowitz, co-president of QME Entertainment. “Their commitment to the rental market is unparalleled and guarantees that we will be able to reach a widespread audience.”

The Humanity Bureau, which made its theatrical debut in April, is a dystopian thriller set in the year 2030 that sees the world in a permanent state of economic recession and facing serious environmental problems as a result of global warming.

“Redbox provides customers with the newest home entertainment releases, months or years before subscription streaming services,” said Galen Smith, CEO at Redbox. “Partnering with QME Entertainment as the exclusive window partner on The Humanity Bureau further demonstrates our commitment to delivering the latest content across multiple price points and formats.”

The Humanity Bureau is now available to rent exclusively on DVD and Blu-ray Disc at all Redbox kiosks in the United States through June 11. The film will be available to purchase at designated retailers, online and in-store, on June 12.

Redbox Counters Disney With Amended Lawsuit

The day after the Walt Disney Co. filed an amended lawsuit against Redbox alleging copyright infringement, the kiosk vendor countered with its own amended litigation.

The suit, filed April 10 in Los Angeles District Court, accuses Disney – and new co-defendant Anderson Merchandisers LLC – of copyright misuse, false advertising, unfair competition and “tortuous interference” regarding its ability to sell digital codes included in Disney packaged media combo packs.

Redbox is seeking antitrust treble (“triple”) damages and injunctive relief against Disney and Anderson Merchandisers.

The kiosk vendor said it filed the countersuit following a Feb. 20 federal court ruling that both denied Disney a preliminary injunction against Redbox and found Disney committed copyright misuse on 20 of its most recent movies.

Disney alleges that the digital codes included in combo packs cannot be sold separately. It filed initial litigation against Redbox last November. Redbox is selling the codes at a significant discount to the retail cost of standalone digital purchases on third-party platforms.

“Disney wants to eliminate low-cost options like Redbox in order to force consumers to pay as much as possible for Disney’s content, even after Disney has already been fully compensated when it first sells that content to a distributor or retailer,” read the complaint.

Redbox said Disney has not only failed to correct its false advertising to consumers but has doubled down on its unlawful campaign against Redbox with the home video release of three recent titles: Coco, Thor: Ragnarok and Star Wars: The Last Jedi.

“Incredibly, Disney complains that consumers may believe these titles, as well as [upcoming] Black Panther, are somehow inferior to those of other studios simply because Redbox offers them at low prices,” read the complaint. “We look forward to advancing our case to an ultimate victory in court.”

 

Disney Files Amended Redbox Complaint

The Walt Disney Co. and subsidiaries Lucasfilm and Marvel Studios have filed an amended complaint against Redbox, claiming the kiosk vendor infringes copyright law by selling digital codes to its movies.

The complaint, filed April 9 in U.S. District in Los Angeles, alleges Redbox continues to sell separately digital codes included in Disney movie “combo packs,” featuring the DVD, Blu-ray and/or 4K/UHD disc to a particular title.

Disney claims Redbox sells the codes without authorization and in violation of applicable license agreements included in writing with every packaged media release.

“Redbox will continue to knowingly and materially contribute to the infringement of the copyrighted works unless and until ordered to stop doing so,” read the complaint.

The media company last November filed suit against Redbox, seeking to prohibit it from selling codes to titles such as Rogue One: A Star Wars Story and Moana at a discount to what digital copies sell for on Amazon or iTunes.

A planned hearing scheduled last month on a motion by Redbox to dismiss the lawsuit was postponed.

Disney contends Redbox sells codes to the following titles: Coco (2017), Pirates of the Caribbean: Dead Men Tell No Tales (2017), Beauty and the Beast (2017), Finding Dory (2016), The Jungle Book (2016), Moana (2016), and Inside Out (2015).

Lucasfilm titles include Star Wars: The Last Jedi (2017), Rogue One: A Star Wars Story (2016), and Star Wars: Episode VII – The Force Awakens (2015).

Marvel copyrights include Doctor Strange (2017), Guardians of the Galaxy Vol. 2 (2017), Thor: Ragnarok (2017), and Iron Man 3 (2013).

More importantly, Marvel’s Black Panther, the top box office movie of the year, is slated to release into retail channels shortly.

Disney now wants to jumpstart legal proceedings.

“The obvious consequence of Redbox undercutting of licensee prices is that licensees will likely sell fewer digital downloads of Disney movies and Disney will earn less revenue,” Janice Marinelli, president of Disney/ABC Home Entertainment, said in the compliant.

A Redbox representative was not immediately available for comment.

Redbox Partners with Mediamorph to Expand Digital Footprint

Redbox April 2 announced an agreement with cloud-based software company Mediamorph to help expand its digital distribution of movies and video games.

Last December, Redbox bowed Redbox On Demand, a transactional VOD platform available on the Redbox website, the Redbox app for Android and iOS-enabled devices, as well as Apple TV, Chromecast, LG and Samsung Smart TVs and Roku.

“We sought out a partner to help streamline our avails management, content ordering and pricing management processes,” Lowell Bike, director of product management at Redbox, said in a statement. “By leveraging Mediamorph’s cloud solution and industry-specific systems, we can seamlessly scale our content offering and ramp up to support consumer demand.”

Mediamorph CEO Rob Gardos said Redbox would now be able to “quickly scale,” bringing more content and the right mix of offers to consumers.

“We … look forward to helping the company add even more titles to the Redbox On Demand offering,” he said.

Privately-held Redbox continues to rent DVD, Blu-ray Disc movies and video games through a nationwide network of more than 41,500 kiosks.

Redbox Expanding Nintendo Switch Game Rentals

Redbox March 21 announced the expansion of Nintendo Switch game rentals to kiosks in Denver; Salt Lake City; and Nashville, Tenn.

Combined with an initial rollout in October 2017 in Portland, Ore.; Seattle and San Antonio, more than 2,000 Redbox kiosks across six markets feature Nintendo Switch games for rent.

“Nintendo launched the Switch console about a year ago, and now it’s the fastest-selling console of all time,” said Aaron McDowell, head of games at Redbox, in a company blog. “People love it. And they love it because you can use it whenever you want and however you want.”

He praised the game system’s flexibility.

“The Switch has a screen and two removable controllers called Joy-Cons,” he said. “You can put in a game cartridge and just play it alone wherever you want with the controllers attached. Or if you want to play with a friend, the controllers come off and you can challenge each other. You can also plug, or ‘dock,’ the Switch into your TV or any screen that has a USB port if you want the big-screen experience.”

He added Redbox is more than doubling the number of kiosks with Switch rentals. The initial rollout included 600 kiosks.

Nintendo Switch games available or coming soon in March, include:

  • Dragonball Xenoverse 2
  • Just Dance 2018
  • LA Noir
  • LEGO Ninjago
  • Mario + Rabbids Kingdom Battle
  • Monster Energy Super Cross
  • NBA 2K18
  • Pokken Tournament DX
  • Sonic Forces
  • Splatoon 2

Game rentals are $3 a night. Some previously-rented games are also available to purchase. The full lineup of games available to rent at Redbox is listed here.

Redbox Ups Q4 Usage, Tops iTunes, Google, YouTube, Vudu

The percentage of consumers renting or purchasing movies from Redbox increased in the fourth quarter 2017 from Q3, according to new data from TiVo.

In a survey of 3,000 respondents, TiVo found that 12.5% of respondents used Redbox in Q4 compared to about 10% in Q3. The percentage trailed only Amazon (17.9%), which was up 3.3% from Q3.

Redbox usage topped iTunes (7.9%), Google Play (7.2%), YouTube Movies (4.8%), Vudu (3.7%), CinemaNow (2.2%), Flixster (1.5%) and other (1.4%).

TiVo found that 37.3% of all respondents purchased from pay- per-rental or TVOD services, an increase of 4.6% from Q3. Another 38.5% with pay-TV service are cord-cheaters (those who have pay-TV service and also use a TVOD service), an increase of 5.8%.

The report found that 34.3% of cord-cheaters use both TVOD and SVOD services in addition to their cable/ satellite service, a category that increased 5.2%.

Specifically, 79.6% of respondents spend money on a TVOD rental monthly, an increase of 3.1% from Q3; up 6.7% from the previous-year period and up 11.2% from two years ago.

More than 32% spends $3 to $8 monthly, while 13.3% spends $9 to $11 per month, and this group increased slightly quarter-0ver-quarter; up 4% y/y and up 5.8% over two years.

Finally, of the 37.3% of respondents who use TVOD services, 79% watch content on a weekly basis, an increase of 8.7% y/y and 11.8% over two years.

Hearing on Redbox Motion to Dismiss Disney Lawsuit Postponed

A hearing scheduled for March 5 on a motion by Redbox to dismiss a lawsuit brought against the video rental kiosk operator by the Walt Disney Co. has been postponed for a week, a Redbox spokesperson said.

Disney last November filed suit against Redbox, seeking to prohibit Redbox from selling movie download codes to titles such as like Rogue One: A Star Wars Story and Moana at a discount to what digital copies sell for on Amazon or iTunes.

Disney had argued that the sale of download codes violates copyright law. Disney includes a warning on combo packs that “codes are not for sale or transfer” – a warning underscored in the terms of use, which say the “sale, distribution, purchase, or transfer of digital copy codes … is strictly prohibited.”

On Feb. 20, a federal court in Los Angeles rejected Disney’s motion for a preliminary injunction to stop selling the codes.

The judge ruled that the warning does not constitute a contract restricting what a consumer can do with product purchased at retail.

In a critical finding, Judge Dean Pregerson ruled that “this improper leveraging of Disney’s copyright in the digital content to restrict secondary transfers of physical copies directly implicates and conflicts with public policy enshrined in the Copyright Act, and constitutes copyright misuse.”

The preliminary injunction was granted because the court agreed with Redbox’s contention that Disney was unlikely to prevail on its case.  According to the ruling, “Disney has not demonstrated a likelihood of success on the merits of its contributory copyright infringement claim.”

“From Redbox’s perspective, the court’s decision was a common-sense application of the law of contracts to the unenforceable fine print on the outside of Disney’s combo packs,” Brennan said.

However, the court did rule that “at this stage of proceedings, it appears to the court that the First Sale Doctrine is not applicable to this case” – a critical cog in Redbox’s January countersuit against Disney, in which the kiosk operator maintains Disney digital codes should not be treated any differently than physical discs that it is legally entitled to rent.

The First Sale Doctrine, which video retailers used in the early 1980s to establish their right to rent videocassettes over strong studio opposition, says a copyright owner cannot prohibit a purchaser from reselling a copy of a work, such as DVD.

Disney is the only studio that won’t sell product to Redbox. As a result, Redbox staffers buy Disney DVDs and Blu-ray Discs at retail, and then rent the discs while selling the codes – included in Blu-ray Disc combo packs – separately.