Redbox Raises Prices- People Still Want DVDs

Redbox, the popular DVD-rental kiosk, announced on Monday it would increase its prices by up to 50 percent for some services. Rental prices for DVDs increased from $1.20 a night to $1.50 night starting December 2. The price of Blu-Ray is also set to increase from $1.50 to $2.00 a night, and videogame rentals from $2.00 to $3.00 a night, as of January.  Industry analysts claim the price hikes suggest perceived strength of the business, contrary to popular belief that DVDs are being run out of town by streaming services, such as Netflix.

CEO of Outerwall Inc. (the company that owns Redbox), Scott Di Valerio says,

The pricing adjustments announced today will allow Redbox to continue to offer consumers high quality movies and games while making investments to enhance the customer experience.”

The new prices are expected to assist the company invest in new technologies, including the launch of an online recommendation engine meant to guide customers towards films and television shows they are likely to enjoy. As quoted in a Wall Street Journal article, Redbox President Mark Horak stated,

Creating a business plan that allows us to make these investments in the future is important.”

Analysts suggest the price increase is a risky move by Redbox as much of the business’s appeal comes from it’s low prices. However, despite the increase, the kiosk fees of renting a Redbox DVD remain much lower than that of on-demand rentals which normally cost around $5.00 for new releases. Furthermore, Redbox offers a wide range of new releases which typically take a while to make it onto the Netlflix menu. The Numbers, a movie-industry data information site, reports figures that suggest DVDs will not be disappearing any time soon. DVD’s remain popular, with Disney’s Frozen as the biggest selling movie of the last year, with 5.4 MN units sold.


Read more here- “Redbox Raising DVD Rental Price by 25%,” (Ben Fritz, The Wall Street Journal)

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Olivia is a graduate of Villanova University where she studied Economics and History, minoring in Gender and Women's Studies. She also has experience working with federal legislatures on health care policy, women's issues, and Internet safety.



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