Verizon + Redbox = Netflix Threat?

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Rumor has it that Verizon (NYS: VZ) is prepping a foray into Netflix (NAS: NFLX) territory.

Fellow Fool Rick Munarriz isn't worried, based on the initial rumblings of what the service will look like, but more details are emerging that give the prospective service a little bit of a better chance. TechCrunch uncovered some more info last night that points to Coinstar's (NAS: CSTR) Redbox division as a major partner -- creating a red-on-red mashup.

Coinstar has been talking up its digital streaming ambitions for ages, yet nothing has materialized other than a Netflix-esque price hike and shattered shareholders' dreams. At long last, Redbox may finally be living up to its promises of stepping into online streaming to confront Netflix, Amazon.com's (NAS: AMZN) Prime Instant Video, and Dish Network's (NAS: DISH) Blockbuster Movie Pass.

Verizon is really embracing online video, as evidenced by its recent partnership with Microsoft (NAS: MSFT) to bring FiOS channels to the Xbox 360 for existing subscribers. The potential Redbox tie-in would extend that strategy and support platforms like Apple iOS, Google Android and Google TV, and Roku, among others. Traditional set-top boxes are notably being left out.

The duo will each bring something to the table, with Verizon likely putting up TV shows and delivery infrastructure, while Redbox pitches in its recognizable brand name and movie offerings. The package would still need blessings from content partners like Viacom (NYS: VIA) , Liberty Media (NAS: LMCA) , and Disney (NYS: DIS) , but having a duo of red rascals at the bargaining table instead of one will help the odds.

It is allegedly scheduled for a May debut with monthly credit-based pricing (redeeming credits for movies and shows). There would be multiple tiers and the service may also include some physical disc rental options that would presumably leverage existing Redbox kiosks.

While there are a lot of details to be hammered out and officially announced, the possibility of bringing Redbox into the fold would give the service another leg to stand on. It will be a long and arduous war, and the red on the battleground won't just be blood.

Add Verizon and Coinstar to your Watchlist to see if the red duo hook up. Digital streaming is just another part of the mobile revolution. There's another stock not mentioned that is set to cash in on the mobile revolution. Get access to this free report to find out who.

At the time this article was published

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