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Here We Go Again!

12 Aug, 2009 By: Thomas K. Arnold

I've got some breaking news for you!
Redbox Automated Retail has filed suit against 20th Century Fox Home Entertainment over the studio’s decision to withhold its new DVD releases from the kiosk company by 30 days. Last year Universal Studios imposed a 45-delay on sales to Redbox and promptly became the first studio to be sued by the kiosk company (although, in all fairness, Universal sued first, to stop Redbox from renting its titles until given the OK by the studio).
This is getting very, very interesting. Studios are fairly unanimous in their sentiments that buck-a-night kiosks rentals are hurting the DVD sellthrough business, particularly since so many of those kiosks are now situated in the lobbies of Wal-Mart stores, the nation's No. 1 retail seller of DVDs. But they are split into two camps over how to deal with this menace: Fight them to the death, or sleep with the enemy.
Universal and Fox, clearly, are in the former category, while both Sony Pictures and Lionsgate have cut deals with Redbox to effectively lease new DVD releases to the kiosk company. Under those deals, sales of previously viewed rental product--which studios see as another big factor behind sagging DVD sales--is verboten.
I wonder what's going to happen next. My hunch: Warner will join Fox and Universal in their battle to treat Redox like a dollar movie house that shouldn't get first-run movies, while Paramount will cut some sort of deal, following Sony and Lionsgate. The wild card: Disney.

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