Why Universal Wants To Kill Redbox: It's Launching Its Own DVD Kiosks

from the competition-through-lawsuit dept

It did seem a little odd that Universal Studios was trying to bully Redbox into an agreement that would kill off the DVD vending machine company. After all, having Redbox out there renting some movies (which it paid for) certainly seems better than it not even being an option. Initially, we just chalked it up to Universal trying to make sure it had more control over the rental market -- but a bunch of readers this morning are pointing out that there may be a much more direct reason. It turns out that Universal Studios is launching its own DVD kiosk system. Initially, it's in the UK, but it's likely there are plans to offer them in the US as well. So now the ridiculous "take it or leave it" bullying threat from Universal Studios to Redbox makes a lot more sense: it was designed to force a competitor out of business so Universal could have the market to itself.


Reader Comments (rss)

(Flattened / Threaded)

  1.  
    identicon
    michael, Oct 31st, 2008 @ 5:07pm

    If that is not illegal, it should be! Certainly it's unethical.

     

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  2.  
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    Anonymous Poster, Oct 31st, 2008 @ 5:08pm

    Well, isn't that nice.

    No, wait, nice isn't the word I'm looking for.

    Evil, yeah, that's the word!

    Evil.

     

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  3.  
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    tack, Oct 31st, 2008 @ 5:17pm

    vandalism for the people

    They'd be stupid to have those here, they'd be vandalized daily to protest the MPAA. Redbox is great because its a good value in an industry that offers little of value.

     

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  4.  
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    Anonymous Coward, Oct 31st, 2008 @ 5:50pm

    let them put thiers side by side to redbox, see who rents the most, and what one gets vanalized the most

     

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  5.  
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    Anonymous Coward, Oct 31st, 2008 @ 7:16pm

    I'm with #3 & #4... Oops, that was a plastique DVD, not a plastic DVD.

     

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  6.  
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    Adol, Oct 31st, 2008 @ 8:14pm

    This was a really ridiculous move on Universal's part, attempting to bully a wholly subsidiary of one of the largest corporations on the planet.

     

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  7.  
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    RD, Oct 31st, 2008 @ 9:42pm

    Yeah right

    And anyone want to put money on how much U$ will charge for these rentals? Hint: it wont be $1 per night or whatever Redbox charges, it will be 2-3x as much. Greedy corporations that use underhanded tactics to force out competition will be the end of this world.

     

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  8.  
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    Michael B, Nov 1st, 2008 @ 7:15am

    Not Accordin g to Other News Stories...

    From what I read elsewhere, the so-called POP! kiosks being started in the UK are NOT DVD vending machines, but CONTENT vendors... you plug your USB-enabled media device or memory card into them and the kiosk fills them with audio and/or video content. Joint venture between Sony & Universal. Unless, of course, they plan on another, totally different, evil kiosk!

     

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  9.  
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    Ajax 4Hire, Nov 1st, 2008 @ 7:59am

    I passed a RedBox in the Wal-Mart and thought...

    I passed a RedBox in the Wal-Mart and thought who would rent a DVD from a kiosk?

    The management of payment, return, quality control just seemed too onerous. But then I walked by on Friday night and saw a line 25 people deep. A line to rent DVDs from a Red Vending Machine, a RedBox and I was amazed.

    I love the USA, only in the US could something this innovative be viable. Only with a Credit/Banking System that allows merchants the ability to reclaim lost/stolen goods and the ability of customers to easily pay; only in this environment could something like RedBox thrive.

     

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  10.  
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    Michael B, Nov 1st, 2008 @ 1:56pm

    Re: I passed a RedBox in the Wal-Mart and thought...

    There is a lot to like about Redbox... for example, I rented Leatherheads (BORING) from one last night for $1 and, while driving around today, returned it at another location. Their business model is simple... use only credit cards so if someone never returns a rental hit them for $24 after a certain period... only charge $1 per night... give you one free rental... no people to train, pay, give lunch breaks or benefits to... the only downside I see is the limited selection of videos. I would much prefer to put out $1 for a movie that MAY be great (Leatherheads was NOT) than $3.99 for one that turns out to be a dud.

     

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  11.  
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    Celes, Nov 3rd, 2008 @ 12:46am

    Re: Re: I passed a RedBox in the Wal-Mart and thought...

    Though each Redbox has a limited selection (and IMHO, the selection isn't much worse than that of my particular neighborhood Blockbuster), they don't all carry the exact same movies. It depends on what people return where and when, I suppose. And if you know you're going to rent one, you can check the machines in your area at redbox.com and see what's currently there, which is a feature I'm quite fond of.

     

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  12.  
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    Pixel_Rider, Nov 3rd, 2008 @ 4:18am

    Re: I passed a RedBox in the Wal-Mart and thought...

    I hate to say it, but the US is way behind on the whole vending machine thing. Take a look at some of the things they have over in japan. Over there, you can purchase just about anything (look it up...I mean ANYTHING) from a vending machine, and even pay with your cell phone.

     

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  13.  
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    hegemon13, Nov 3rd, 2008 @ 6:23am

    Re: I passed a RedBox in the Wal-Mart and thought...

    "The management of payment, return, quality control just seemed too onerous."

    And only Redbox could pull it off. The second movie I rented from a Redbox was scratched and unplayable. At the time, I figured that was it, no more Redbox for me. But, I went to the Web site and emailed their customer service. Within 8 hours I received an apologetic reply thanking me for reporting the bad disc and giving me THREE free rental codes. They earned me back, and I have never had an unplayable disc since. For a company whose business revolves around vending machines, their service is surprisingly good.

    As far as returning movies, it is far more convenient to look for the closest golden arches than to drive out of my way to the specific store I rented from. And most people in line are nice enough to let you jump in if you are only returning (it takes about 15 seconds). It seems like there is a Redbox etiquette evolving or something because I would not have expected this to be the case.

     

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  14.  
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    hegemon13, Nov 3rd, 2008 @ 6:25am

    Re:

    I think it was pretty clear antitrust before, but this seals the deal. Now, it can easily be proven in court that Universal was directly interfering with the contracts of a competitor, not just a distributor, and price-fixing their product to eliminate competition.

     

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  15.  
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    redbox guy, Nov 12th, 2008 @ 10:34am

    Re: Re: I passed a RedBox in the Wal-Mart and thought...

    I like the training and benefits I get from working for redbox :-) but there are ant that many of us out there so the low cost structure stays viable.

     

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  16.  
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    redbox guy, Nov 12th, 2008 @ 10:38am

    Re: Re: Re: I passed a RedBox in the Wal-Mart and thought...

    typo: there are not that many of us out there... My appologies to the reaaders.

     

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  17.  
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    Mo, Dec 28th, 2008 @ 9:09am

    universal and redbox

    I would never rent from universal backed business if they continue to push redbox. Redbox has been a great service.

     

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  18.  
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    michael r, Jul 6th, 2009 @ 10:32pm

    universal wins

    It is much easier for Universal to create a ghost company that can buy Redbox, rename it and rent or sell movies at higher prices. Example: Sisco.
    Sisco buys smaller or emerging startups that in the long run can jeopordise their business, that's why they are the largest network communications company in the world. Another example: Microsoft...... I can go on and on and on. Point is, if you're big and well connected chances are antitrust laws will always bend

     

    reply to this | link to this | view in thread ]


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