Redbox, Lionsgate Renew Distribution Pact28 Oct, 2014 By: Erik Gruenwedel
Redbox and Lionsgate Oct. 28 announced they signed a new multiyear agreement that brings the mini-major’s new physical discs to more than 44,000 kiosks on the day of their retail release date.
Fiscal terms of the agreement, which occurred nearly two months after the original deal expired, were not disclosed. The original five-year, $158 million distribution deal (first signed in 2009 and extended in 2011) expired in August.
"Our agreement with Lionsgate continues our track record of establishing win-win relationships with content producers," Mark Horak, president of Redbox, said in a statement.
Lionsgate, along with Paramount Home Media Distribution, Sony Pictures Home Entertainment and Anchor Bay Home Entertainment, all have street-date agreements with Redbox. Warner Home Video, 20th Century Fox Home Entertainment and Universal Pictures Home Entertainment collectively mandate a 28-day embargo to the kiosk vendor for all new releases.
“We remain committed to expanding the choices … for our consumers, and our Redbox relationship is an important part of this commitment,” Ron Schwartz, president of home entertainment at Lionsgate, said in a statement.
Horak said Redbox commands a network of about 35 million consumers who rent new releases on a weekly basis. The kiosk vendor remains a leading revenue stream for studios. As of June 30, Redbox’s digital marketing channels spanned more than 35 million email subscribers, 26 million app downloads and 5 million SMS subscribers.
That said, B. Riley & Co. analyst Eric Wold wondered why it took nearly two months to iron out a new agreement.
“I’m trying to find out what changed and why it took [so long],” Wold said in an email.
Redbox parent Outerwall reports third-quarter financials Oct. 30.