Redbox and Verizon are joining forces in a JV effort to add streaming video to their entertainment arsenal, but does that JV stand for Joint Venture or Junior Varsity in this case?
Rightfully so, they are being coy regarding the details of the service so I only have preliminary information and foresight to go on so stick with me here and grab some good info from this FastCompany post to educate yourself.
The service seems like a nice blend of what Blockbuster tried to do and what Netflix has continually screwed up, but ultimately something consumers could get down with. Blockbuster currently offers in store exchanges (if you can find a store) of their mail in videos for faster exchanges and constant movies. However, they never synced their kiosks and a streaming service which would have been a powerful move. Netflix let power go to their head and tried to blow everything up while never having a physical presence.
RedBox now sits with a strong network of kiosks for impulse rents and needs to make the leap to digital. A partnership with Verizon is smart because it will allow each to focus on a core competency and execute properly. I think they are putting more stock in the RedBox brand than is really warranted, but that’s a minor contention.
What has me really on the fence at this point is that it is a subscription service so I worry that it will be too little too late. Would you switch from whatever service you have to have Kiosk access? Would you add their fee to have it? I would guess if you have Netflix you would still throw down the occasional couple of bucks for a disk out of the kiosk – especially since content across all of these options is insanely fragmented. I’m not sure this is enough to get people to add/switch.
Here’s a few suggestions for them that I think would help push it over the top.
- CONTENT CONTENT CONTENT – Did I mention content? Seriously they need to maximize the offering and own the competition in this area. Hulu free service is getting worse by the second; I’m not even sure Netflix has movies; HBO is too limited… Get on it!
- Innovate distribution – How about cheap airport kiosk that you can rent just for the flight? Or temp download from one airport wifi and dump it 12 hours later? Lots of options, but it has to offer consumers content where/when they want it.
- Nail Pricing – Easier said than done I know. This is key in pushing people to add or switch. If you offer a very similar service to the alternatives then you need to be cheaper. Even if you master my first two suggestions, you still need to be on par with their pricing. I’d also keep non-subscription options open. I’m sure they will do this at Kiosks, but will there be a streaming pay-per-view option?
There’s a lot of questions still out there, but it’s such an interesting business to explore that I couldn’t help it. Hope you enjoyed! Comments???