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Irish Retailer Touts Consumer Interest in Kiosk Disc Rentals

27 Mar, 2015 By: Erik Gruenwedel

The United Kingdom is the third-largest home entertainment market in the world. Germany saw consumer spending on Blu-ray Disc rentals increase 9% in 2014. At the same time, kiosk disc rentals in Europe have languished. The landscape is dotted by failed regional start-ups (Cine Bank in France, for example) that never approached the popularity of Redbox in the United States.

Irish video retail and rental chain Xtra-vision thinks it can buck the trend. The Dublin-based retail chain with 90 stores also operates 100 Xpress kiosks throughout the republic, renting DVD and Blu-ray titles from €2.99 ($3.25) a night. Consumers apparently are noticing.

“50,000 people have already joined @Xtravision #Xpress renting DVDs and Games from machines all over Ireland,” CEO Paul McGowen tweeted March 23.

McGowen heads Hilco Capital Ireland, the investment firm that acquired Xtra-vision out of receivership (a type of corporate bankruptcy) in 2013 for €8 million ($8.7 million). Hilco split rebranding stores with HMV due to its ownership of the British entertainment retailer.

Xtra-vision — Ireland’s largest packaged-media rental chain — was once owned by Blockbuster, which sold the operations in 2009.

The company’s success largely depends on Irish consumer’s ongoing love affair with packaged media and rental. The average consumer rented 5.2 discs per household in 2013 compared to 1.9 in the U.K. and 1.5 in Western Europe, according to IHS.

Xpress kiosks will drive same-store (kiosk) rentals compared to other European countries. Much of this due to the lack of significant competition, according to Richard Cooper, director, video media with IHS.

“The Irish home video landscape is significantly different that in other European markets,” Cooper wrote in a 2014 note.

The analyst said the convenience of kiosks, when presented to relatively keen Irish rental consumers, means they are more likely to echo the success of Redbox.

“Indeed, kiosk rental transactions in the U.S. have continued to grow despite declines in other disc rental sectors,” Cooper wrote.

Meanwhile, media reports suggest Xtra-vision could expand the Xpress brand in the U.K. — a move McGowen supports but hasn’t acted upon.

“There is still a demographic out there that wants to rent. In Ireland, we proved that when we put machines into high footfall communities, you can expand the rental business,” McGowen told Cue Entertainment.

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