July 16, 2009 in Business, Idaho

Redbox attracting local movie fans

Movie rental service typically located at supermarkets
By The Spokesman-Review
 

This story contains a corrected number for Redbox kiosks in Spokane and North Idaho.

Movie fans in Spokane and Coeur d’Alene are getting used to a new shopping ritual: watching people select a DVD from a large red box outside a supermarket.

Some are already converts to the Redbox gang, the increasing number of consumers who are renting movies from machines that are just a bit larger than a phone booth.

Redbox was originally launched as a subsidiary by fast food giant McDonalds, then sold to Coinstar Inc., the Bellevue-based firm that has coin-changing machines inside grocery stores.

So far Redbox has 15,400 movie machines across the country and in Puerto Rico. Christopher Goodrich, a spokesman, said the goal is to have 20,000 or more deployed by the end of 2009.

Goodrich said Redbox won’t disclose sales figures for an individual market like Spokane. An earnings report filed recently reported the company grossed $26.6 million in the first quarter of 2009 from DVD rentals.

Redbox has about 30 machines in the Spokane area and five in Post Falls and Coeur d’Alene, said Goodrich.

The machines generally are just outside the entrances to supermarkets operated by Rosauers, Albertsons, IGA, Wal-Mart, Super One and Yoke’s. Others are in area Walgreens and Town Pump locations.

Earlier this year Boise-based Albertsons replaced a different automated movie kiosk system with the Redbox system in all of its 248 stores.

Nationwide, Redbox is also adding machines in Circle K stores and at other retail sites.

Redbox has deals to share machine revenue with its location partners, but how much goes back to the retailers Redbox won’t divulge, Goodrich said.

Renting a Redbox film requires the consumer to use a credit or debit card. A rental costs $1 a day.

Goodrich said one of the reasons consumers prefer Redbox is the ease of use and convenience.

“The boxes are located where consumers are already shopping, so it saves an extra stop in a busy day,” he said. And the movies can be returned to any Redbox kiosk, not only the one that provided the DVD, he added.

The company, borrowing from other media providers, is also tracking local popularity of rentals so that each machine can provide the right mix of titles and the correct number of copies at each location.

Each machine carries about 200 movie titles and up to as many as 700 DVDs.


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