Universal, Redbox Extend DVD Rental Deal With 28 Day Window Through 2014

NEW YORK- Universal Studios Home Entertainment and DVD rental kiosk operator Redbox said Thursday that they have signed a multi-year agreement that will continue to make Universal Blu-ray and DVD titles available for rental at Redbox locations nationwide 28 days following their home entertainment release.

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The agreement extends the relationship between Redbox and Universal Studios Home Entertainment through August 2014. The previous deal was set to expire in April, according to analysts.

The 28-day delay deal comes as Redbox and Warner Bros. are divided over the terms of their rental arrangement, with the Time Warner studio pushing for a delay of 56 days.

"Not only was the agreement extended almost two months early, but there were no changes to the main 28-day delay terms," B. Riley analyst Eric Wold said.  "Following the push by Warner Bros. for a 56-day delay…we believe there has been increased concerns that Universal and/or Fox (would make similar moves (given that all three acted similarly in 2009/2010). We believe this is significantly positive news and removes a cloud over the shares."

The stock of Redbox parent CoinStar rose 3.1 percent to $60.02 as of 9:37am ET.

"The multi-year agreement between Universal Studios Home Entertainment and Redbox represents a win for consumers, Universal and Redbox," said Galen Smith, senior vp at Redbox, who made the announcement with Craig Kornblau, president of Universal Studios Home Entertainment. "Redbox is committed to forging relationships that provide our consumers with affordable and timely access to new release content."

Email: Georg.Szalai@thr.com

Twitter: @georgszalai