Redbox Instant By Verizon Shutting Down Oct. 7

SVOD Service ‘Was Not As Successful As We Hoped It Would Be’
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Redbox Instant by Verizon, the Netflix-like subscription multiscreen video service, is shutting down on Tuesday, Oct. 7, the joint venture confirmed in this Web posting.

GigaOm first reported about the coming shut-down on Saturday, noting that subscribers were also informed via email earlier in the day. GigaOm reported earlier that Redbox Instant by Verizon had halted new sign-ups in recent months because the service’s monitoring systems had “detected that criminals were misusing our new customer registration process to validate credit card numbers illegally obtained from some other sources.”

The full posting about the coming shut-down reads as follows:

IMPORTANT SERVICE SHUTDOWN NOTICE

Thank you for being a part of Redbox Instant by Verizon. Please be aware that the service will be shut down on Tuesday, October 7, 2014, at 11:59 p.m. Pacific Time.

Information on applicable refunds will be emailed to current customers and posted here on October 10. In the meantime, you may continue to stream movies and use your Redbox kiosk credits until Tuesday, October 7 at 11:59 p.m. Pacific Time.

We apologize for any inconvenience and we thank you for the opportunity to entertain you.

Sincerely,
The Redbox Instant by Verizon Team

The Verizon-Outerwall J.V. launched the service in March 2013, offering a service that was viewed as a potential rival to Netflix, a service that now counts more than 50 million subscribers worldwide. The Redbox Instant by Verizon service provides subscribers with access to a streaming library, plus the option to obtain credits toward DVD/Blu-ray discs that are available at Redbox kiosks. Customers can also rent or buy titles electronically from a separate library, with rentals starting at $3 for 48 hours, and purchases starting at $9.

Redbox Instant by Verizon has not disclosed subscriber figures, but the totals clearly weren’t nearly enough.

“The service is shutting down because it was not as successful as we hoped it would be. We apologize for any inconvenience and we thank you for giving us the opportunity to entertain you,” reads the FAQ about the decision to shut down the service.

The FAQ adds that the service will be providing a full month’s subscription fee refund to customers who paid for, but only received a partial month of service, and that refunds will be automatically applied to payment card accounts no later than October 24. Customers must also use disc rental credits included with their subscriptions by Tuesday, Oct. 7.

Redbox Instant by Verizon said it is “exploring options” for customers who purchased electronic versions of movies that are currently being stored in digital lockers.

Redbox Instant by Verizon has developed apps for a range of platforms, including PC browsers, iOS and Android-powered smartphones and tablets, the Xbox One and Xbox 360, PS3 and PS4, Roku, Chromecast, Fan TV, Samsung smart TVs and Blu-ray players, LG smart TVs, Kindle Fire  tablets, and Windows Phone 8.

A statement from a Redbox Instant by Verizon spokesman about the decision issued Saturday largely echoed the public posting: “The joint management of Redbox Instant by Verizon has elected to cease operation of the service effective Tuesday, October 7, 2014.  The joint venture partners made this decision after careful consideration  The service had not been as successful as either partner hoped it would be.  We apologize for any inconvenience this may cause our customers.”

It was not immediately known how many employees tied to the service would be affected by the decision. “While Human Resources matters are private, I can tell you that the Redbox Instant by Verizon team is made up of talented individuals who made great contributions to the service,” the spokesman added.

The coming shutdown of Redbox Instant by Verizon enters view as Comcast shifts the distribution and sales strategy for its own SVOD offering, Streampix. Comcast confirmed in late September that it had halted sales of Streampix to broadband-only customers and that is was decommissioning its Streampix apps and Web site. However, the Streampix service will continue to be sold as an a la carte option (for $4.99 per month), or given away as a perk, to customers who take certain bundled service packages.

Meanwhile, Canadian operators Rogers Communications and Shaw Communications, are set to launch their multiscreen streaming service, “shomi” in beta form later this month.

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