Redbox, Paramount extend deal to 2011
Potentially runs through 2013 with option for studio to bailParamount Home Entertainment has extended its tentative revenue-sharing agreement with dollar-rentals giant Redbox through at least 2011.
The studio will continue to provide the kiosk chain with Paramount's DVD and Blu-ray Disc releases simultaneously with release in other retail channels. The agreement potentially runs through 2014, with Par having an option to bail from the pact on Dec. 31, 2011.
Par, Sony and Disney allow dollar rentals of their new releases. Warner Bros., Fox and Universal withhold such titles from kiosk chains for the first four weeks of release, believing that cheap rentals undermine disc sales.
Redbox operates 22,000 dollar-rental kiosks nationwide.
"After analyzing the data from our test period we have concluded that Redbox day-and-date rental activity has had minimal impact on our DVD sales," Paramount Home Entertainment topper Dennis Maguire said. "By granting Redbox day-and-date availability, we are allowing the consumer a choice of how to consume our movies while maximizing the profitability of our releases in the home entertainment window."
Redbox president Mitch Lowe called the new deal "a win, win and win -- for consumers, Paramount and Redbox. "
Redbox and PHE inked a trial license agreement in August.