updated 05:50 pm EDT, Tue June 15, 2010
Paramount won't follow studios on Redbox delays
Paramount bucked the trend to major resistance towards non-traditional movie rentals by striking a same-day deal with Redbox. Under the terms, both Blu-ray and DVD movies will be available through the on-the-spot kiosks the same day as they're available to rent elsewhere. The movie studio rejected the fears that have led Warner Bros. and other studios to try and force 28-day delays, arguing that there's ultimately no impact to giving RedBox $1 rentals at the same time.
"After analyzing the data from our test period we have concluded that Redbox day-and-date rental activity has had minimal impact on our DVD sales," Paramount Home Entertainment worldwide president Dennis Maguire said. "By granting redbox day-and-date availability we are allowing the consumer a choice of how to consume our movies while maximizing the profitability of our releases in the home entertainment window."
Rivals to Paramount are believed to primarily be protecting stores like Blockbuster that often charge $4 or more for renting a new-release movies. Such strategies haven't necessarily been effective, as Blockbuster is increasingly rumored to be short on cash and needing loans to keep operating through 2011. Internet downloads and Netflix have largely gutted the traditional business as they offer more movies for the money.
Redbox itself has already planned an exit strategy and may offer cheap Internet streaming in the future.