Redbox Hikes Prices on Renting DVDs, Games
Beginning Dec. 2, daily rental rates for DVDs will go from $1.20 to $1.50 (up 25 percent); and Blu-ray rentals will rise from $1.50 to $2 (up 33 percent). Beginning Jan. 6, daily video game rentals will rise from $2 to $3 (up 50 percent).
Even at $1.50 a day, Redbox remains "the best value in new-release home entertainment," says parent company Outerwall (OUTR) in a statement. "Consumers can continue to expect access to the newest movies months before streaming subscription services and daily prices that are still lower than video on demand," said Outerwall CEO J. Scott Di Valerio.
Movies on demand typically cost $2.99 to $5.99, depending on the format and video provider.
The Competition Strikes Back
Redbox faces mounting competition from video streamers Netflix (NFLX) and Amazon (AMZN). Its third-quarter revenue dropped 5 percent to $1.4 billion, and same-store sales fell nearly 12 percent, according to Retailing Today. By the end of 2014, Redbox had expected to remove 500 to 700 under-performing kiosks.
Di Valerio said its price hikes represent "the first time Redbox has raised prices on Blu-ray discs and video games and only the second time in more than 12 years that we've raised prices on DVDs."