Tuesday, April 14, 2009

Redbox is considering using its self-service kiosks to rent video games

With its self-service video rental kiosks, Redbox is putting the hurt on traditional movie rental stores like Blockbuster.
Redbox, a unit of Coinstar, rents DVD movies for $1 per night from its automated machines in grocery stores, drug stores and fast-food restaurants. It operates about 13,000 red kiosks nationwide in Walgreens, Wal-Mart and McDonald’s outlets and plans to have over 20,000 deployed by year’s end. (I profiled Redbox in a story published April 8 in Investor’s Business Daily.)
Meanwhile, GameFly, which rents video game discs by mail, is experimenting with self-service game rental kiosks. Privately held GameFly is the online video game rental leader. It provides video games on a subscription basis, much like Netflix does for DVDs.
Redbox is watching the video game market closely. I asked Coinstar President, and former Redbox CEO, Gregg Kaplan about the GameFly test and Redbox’s plans for video games in a March 18 interview.
“Video games is an obvious place for us to look,” he said. “I can’t really comment on plans for the future specific to video games because we’re currently focused just on DVDs. But it seems like a pretty obvious place for us to consider. You could bet that it’s certainly something that we’re looking at.”

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