What’s that sound? It could be the future sound of Netflix possibly losing some market share with the official announcement from Verizon and Coinstar’s Redbox that they will be coming together to offer a new rental service that will offer both physical and digital streaming media content to consumers. Subscribers to the service will be able to rent DVDs, Blu-rays, and have access to on-demand streaming and download service from Verizon. The service will launch sometime in Q2 2012, at which time we should hear more information about what devices will support the streaming services. Verizon will be holding a 65 percent ownership share and Redbox holding a 35 percent ownership share at the outset, we cannot say we like the sound of Verizon having more say in this service than the usually consumer friendly Redbox.
According to Verizon and Coinstar, “flexible and affordable service that will allow all consumers across the U.S. to enjoy the new and popular entertainment they want, whenever they choose, using the media and devices they prefer.” Based on that, we can infer that the service will be apparently limited to the United States and that there will be some widespread device availability of the streaming service. We still would like some solid information on as to which set-top boxes, tablets, phones, gaming consoles, and connected HDTVs will actually get the service, but we assume Verizon and Redbox want to go everywhere that Netflix can be on. Verizon and Redbox both have unique attributes to offer to this partnership that includes plenty of Hollywood studio content deals and they could stand to finally offer consumers a much more better choice to Netflix than what other companies have attempted so far.
[spoiler]Verizon and Coinstar’s Redbox Form Joint Venture to Create New Consumer Choice for Video Entertainment
Joint Venture Will Offer the Best of Both Worlds – Physical and Digital – to All Consumers Nationwide
NEW YORK, Feb. 6, 2012 /PRNewswire/ — Verizon and Coinstar, Inc. today announced the formation of a joint venture that will create a new choice for quality- and value-conscious consumers seeking a simple and affordable way to access the video entertainment they crave. The venture’s services will offer all of the convenience, simplicity and value of Redbox® new release DVD and Blu-ray Disc® rentals combined with a new content-rich video on-demand streaming and download service from Verizon.
The joint venture plans to introduce the product portfolio in the second half of 2012. It will offer subscription services and more in an easy-to-use, flexible and affordable service that will allow all consumers across the U.S. to enjoy the new and popular entertainment they want, whenever they choose, using the media and devices they prefer. Additional brand and product information will be revealed in the coming months.
“When you consider the core elements the parties bring to this venture – our powerful brands; our national rental kiosk footprint; our anytime, anywhere network presence; and our mutual commitment to customer-focused innovation – it’s clear that Verizon and Redbox are a powerful entertainment team,” said Bob Mudge, president of Verizon consumer and mass business markets.
“Consumers rely on Redbox for the latest new release movies at a great value, and our joint venture with Verizon will enable us to bring them even more value by offering expanded content offerings and greater flexibility for how and when they enjoy entertainment,” said Paul Davis, chief executive officer of Coinstar, Inc. “This alliance is the result of a deliberate and strategic process to identify a partner who shares our commitment to delivering innovative solutions to consumers. We look forward to rolling out the shared benefits this venture will bring to consumers, retailers, and shareholders.”
This venture between Verizon and Redbox will create the kind of national multi-platform product that customers are demanding from video entertainment service providers. It will leverage Verizon’s industry-wide relationships with entertainment content providers, its advanced cloud computing technologies and state-of-the-art IP network infrastructure to distribute video on-demand content to its customers.
“The joint venture will combine the accessibility and value of Redbox with Verizon’s vision for a borderless lifestyle – where consumers easily accomplish what they want or need to do, on their terms, through the power of the network,” said Mudge. “Together, we are erasing old technology boundaries, freeing people to spontaneously enjoy the entertainment they want, whenever they choose, using the devices and media they prefer, at home or away.”
By offering instantly available online and mobile content with immediate access to physical media through rental kiosks, Verizon and Redbox will be uniquely positioned to deliver the best of both worlds – digital and physical – to consumers across the country.
The joint venture is a limited liability company with Verizon holding a 65 percent ownership share and Redbox holding a 35 percent ownership share at the outset.[/spoiler]