Redbox Instant Streaming To Launch Alpha Testing, Name Former Verizon FiOS Exec Shawn Strickland CEO

In February, Coinstar subsidiary Redbox announced a joint venture with Verizon to launch a streaming video service. Later this afternoon, we're told, the companies will provide a bit more insight into the partnership, though details of the service are still extremely limited.

Here's what will be revealed: The service will be launched in internal alpha testing today, followed by a beta program in the coming months before the streaming service goes live later this year. It will be branded Redbox Instant by Verizon; it will combine access to physical and digital content; and the JV will be led by newly appointed CEO Shawn Strickland, who previously worked as a vice president in Verizon's FiOS business. Such a set up indicates the partnership will rely mostly on Redbox's branding, which mimics competitors Netflix Instant and Amazon Instant, while taking advantage of Verizon's network infrastructure. "DVDs at the kiosk + instant streaming hits, all in one fist-pumping package," teases a landing page, seen above, which is set to go live later today.

For consumers eager to have an alternative to Netflix, Amazon, Hulu, and HBO Go, the news is bittersweet in its hurry-up-and-wait nature. Redbox Instant will be a subscription-based service, as executives at both Coinstar and Verizon have indicated, but the company will still not provide any insight into subscription rates, studio content, or how the physical and digital parts of the service will be combined.

Redbox operates a network of tens of thousands of DVD-rental kiosks, and averaged 65 million monthly rentals last quarter. Its network was bolstered by Coinstar's recent acquisition of NCR's entertainment business, which included thousands of Blockbuster Express kiosks. In February, Coinstar CFO Scott Di Valerio indicated the JV, which Coinstar owns a 35% share in compared to Verizon's 65% share, would go after a combined streaming and DVD offering, rather than providing streaming-only or DVD-only subscription plans.

"To have a partner that sees our vision, and thinks, yes, you could do something streaming-only, but we'll be so much more successful to consumers if we have both together--that was really what Verizon's take was," Di Valerio told me in February. "Streaming is great...[but] we think there is a bright future in physical."

"Consumers made it clear that they like both the physical disc as well as the digital," Paul Davis, CEO of Coinstar, also told Fast Company at the time. "Given the fact that we have approximately 30 million consumers, and that we are [located] where people go every day--gas stations, convenient stores, supermarkets, drug stores--the instant access to our discs is a real compelling benefit, versus Netflix, where you put what you want in the movie queue, and then you have to wait a few days and hope it comes. We remove that mystery. We really allow consumers to get what they want on new releases, and then for those who want older movies--a more catalog offering--they can get that as well through what we'll be offering as a part of the joint venture."

Still, in a conference call with Davis, a Verizon president stressed that, "At this point, due to competitive concerns, we're limiting our description to 'subscription services and more.'" Outside stressing the advantages of Verizon's network, wireless customer base, and relationship with entertainment providers, Coinstar and Verizon haven't given much more insight into the Redbox Instant service.

We can confirm, however, that the landing page for the JV, at least for now, will be RedboxInstant.com. The alpha product, we're also told, is related specifically to testing streaming subscriptions.

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1 Comments

  • Clay Adams

    So far, this has been a complete and utter disaster. Normally with a Beta, it's okay if there is a mountain of problems like there are in this one - but with RB's terrible customer service and deceptive practices, Netflix has nothing to worry about,