Happy with Redbox's current DVD rental price? Enjoy it while it lasts. The movie kiosk market leader is experimenting with a small-scale, minor price bump. And no matter how it's received by consumers, at least one analyst sees a permanent nationwide rate increase as not only plausible, but fair.
The price increase, currently contained to Austin, TX, amounts to an extra 15-20 cents per DVD rental according to Home Media Magazine. Video game and Blu-ray movie rentals ($2/night and $1.5o/night, respectively), however, will remain unchanged. The industry news outlet quoted Eric Wold, Merriman Capital Research Director, who defended the move in a report this week.
"Although price increases of 15 percent to 50 percent could seem aggressive, we believe these prices still represent a significant value relative to other single-use rental options - such as $4 to $5 for VOD and $2.99 for new-release DVDs at Blockbuster," Wold explained, adding: "While any assumptions could be made at this point, we believe management has enough data at various prices to know what change would yield the greatest positive result."
This isn't the first time Redbox has upped its rates. In 2009, the company bumped DVD rental prices in select markets to $1.50 to $2.00 for the first night. Ironically, Blockbuster has dropped in-store prices to better compete with Redbox.
Redbox boasts over 27,000 kiosks across the U.S. Last week, the company announced the integration of each and every one of them into the popular foursquare mobile app, as well as a 10-day long discount promotion for those who check-in at any kiosk between August 15th and 24th.
While far from confirmation that a true price hike is on the horizon, it will certainly be interesting to see how the move plays out for Redbox. (via Home Media Magazine)
What do you think about a permanent price increase? Is the extra 20 cents per rental enough to turn you off to Redbox? Let us know in the comment section.
