online.wsj.com
Nov 24, 2014
Redbox is raising its DVD rental price by 25%, in a move that could improve the company’s stagnant bottom line and help the Outerwall Inc. unit invest in new technology.
At the same time, Redbox is launching a recommendation engine similar to the one that has contributed to the success of competitor Netflix Inc. by steering customers to movies and TV shows they are likely to enjoy.
“Creating a business plan that allows us to make these investments in the future is important,” said Redbox President Mark Horak, who said the company also is investing in mobile technology and the more efficient stocking of its kiosks, which are located in grocery stores and other businesses.
Beginning Dec. 2, DVD rentals will cost $1.50 a night, up from the current $1.20. Blu-ray disc rentals will rise to $2 a night, from $1.50, a 33% increase.
Much of Redbox’s appeal rests in its low prices, making increases risky. However, the fee still will be about one-third of video-on-demand rentals, which typically cost at least $5 for new releases.
Subscription streaming services like Netflix, meanwhile, offer mostly older titles, not the recent releases available from Redbox. |
