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Redbox Kiosks To Sell Buena Vista Titles

24 Feb, 2006 By: Holly J. Wagner

Automated DVD rental company Redbox will begin selling discs in all of its existing markets this spring, even as the majority-owned McDonald's subsidiary expands into new markets via a deal with supermarket behemoth Ahold.

The $1-a-night rental machines will begin selling Buena Vista's Lady and the Tramp in four cities for $20 a copy on street date, Feb.28, and will follow with The Chronicles of Narnia: The Lion, the Witch and the Wardrobe April 4.

“We're basically selling at MAP on both of those,” Redbox VP of marketing Greg Waring said.

McDonald's exclusive merchandising agreement with Disney prevents Redbox from offering other studios' titles until that deal winds down at the end of the year. Until then, Buena Vista's sellthrough titles will carry coupons for three free Redbox rentals each to keep consumers coming back, and might even sweeten the pot for Narnia with five free rentals, Waring said.

To date Redbox DVD kiosks are in more than 800 locations in eight markets, and the company finishes converting machines in the Denver area to match the rest of the system today, Waring said.

Redbox is adding machines in 400 Stop & Shop supermarkets and Giant Food stores in Connecticut, Delaware, Maryland, Massachusetts, New Hampshire, New Jersey, New York, Rhode Island, Virginia and the District of Columbia, pushing the company into a half-dozen new markets where it does not have a McDonald's foothold today.

Further expansion is expected in the Smith's Food King chain, which has machines in its Las Vegas stores and is considering expanding them into its other market areas, Waring said.

Redbox has made an aggressive push into the market since its wide-scale rollout last April. The company started with 109 McDonald's restaurants in the Denver area and expanded from there.

In November, Coinstar, famous for its green change-converting machines in supermarkets, bought a 47% stake in the company and pledged to use its relationships with grocers to widen the Redbox network.

Redbox reached another milestone in December, when it logged 1.1 million rentals for the month. The company has transacted more than 8 million rentals nationwide since the rollout.

The machines hold about 500 discs and carry 50 to 60 new-release titles. New titles are added on street date to keep stock current. Rentals are $1 a night and consumers can rent from one machine and return the disc at another location, even in another city.

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