Redbox Testing Digital VOD-EST Offering

Trial of ‘Redbox Digital’ service aims to ‘complement’ Redbox’s core kiosk rental business
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Redbox confirmed that it is conducting a trial of a new transaction-based video-on-demand and electronic sell-through service with a subset of customers designed to complement its core kiosk DVD and Blu-ray rental business.

The trial for a service called Redbox Digital, first spotted by Variety, is initially being offered as an iPad app, though a screenshot of the app indicates a casting button that enables users to beam that video from the tablet to the TV screen using a Google Chromecast adapter or a TV equipped with the Google Cast platform. The Redbox Digital app for the trial was released on June 16, and appears to support both streaming and downloading. Variety reported that Redbox is also eyeing an app for the Roku platform.

Redbox hasn’t announced an anticipated length of the trial or when it might follow through with a commercial launch of Redbox Digital.

“Redbox regularly conducts market tests as part of our ongoing efforts to enhance our customers' experience,” a company spokesperson said in an emailed statement. “We are testing a potential new transactional digital VOD and EST offering, with a small subset of our customers, designed to complement our core kiosk rental business. As we test and learn from our customers, we will make evaluations that determine any future course of action.”

Redbox generated approximately 137.7 million rentals in the first quarter of 2016, down from approximately 173.0 million rentals in the first quarter of 2015.

Redbox, which generated 137.7 million rentals in Q1 2016 (down from 173 million in the year-ago period), has dabbled in digital distribution before.

 In 2013, Redbox and Verizon launched a service called Redbox Instant by Verizon that provided subscribers with access to a streaming library, plus the option to obtain credits toward DVD/Blu-ray discs that are available at Redbox kiosks. The J.V. shut down the service in October 2014after it struggled to acquire subscribers.  

If Redbox moves ahead with a commercial launch of a VOD/EST service, it won’t lack for competition, as it will tangle with Apple iTunes, Google Play, Amazon  Video, Vudu, Comcast’s and Verizon’s EST offerings, and FandangoNOW (formerly M-Go), among others. Frontier Communications recently inked a deal with Vubiquity that will pave the way for an EST offering.