The looming public launch of Redbox Instant by Verizon appears to be an escalation of the war between Redbox and Netflix. But the streaming service plans to focus on movies, rather than a catalog of TV shows, which could put the companies on parallel paths.
"Movies are the core business of Redbox," said Redbox CEO Shawn Strickland at CES. "TV is increasingly becoming available via multiple sources, and while there is valuable content there, and our strategy could evolve, we didn't see there was a clear offering to come out around television."
Since its launch last month, more than 10,000 people have entered into the Redbox Instant beta, and Strickland said the waiting list is "substantial." System currently has roughly 4,200 films in its streaming catalog, another 2,500 films available through VOD and 200-300 premium films (also available in the company's kiosks).
The focus on film is a shift from the model Netflix, Hulu and (to a lesser extent) Amazon have taken with their streaming services. But the company faces competition from Walmart's Vudu, among others. Redbox and Verizon hope the appeal of the service is the ability to unify the options available to users.
"We're not a Netflix killer," Strickland said. "If everyone had to be like Netflix in the cable industry, we'd all still be watching ABC, NBC and CBS. ... The value proposition we want to present to consumers is when you want to watch a movie, we offer the freshest selection."
The downside of the model Redbox and Verizon have chosen is the user's monthly subscription fee won't cover everything they want to watch. While they'll be able to stream catalog films, they'll have to pay extra to watch more recent releases.
"To pay for a rental during this offering is a convenience fee," Strickalnd said. "If you want [something] fresh, it's going to cost more than the subscription. That's one of the key challenges we face with customer communication."
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