Netflix executives have just cause for concern this week following the announcement that Redbox and Verizon are to join forces in the creation of an all-new streaming video service. According to company official, the new venture will come to fruition in the latter half of 2012, though few details have yet been offered as to exactly when or what the service will deliver.
They did however state that the project would bring “subscription services and more” and that it would eventually be compatible with several platform, including televisions, home computers and Smartphones.
In addition, the service will not be exclusive for Verizon Wireless customers, but will be on offer to anyone in the US.
That’s about where the specifics come to an end however as executives for both companies have refused to answer direct question on how the service will work and, more importantly, how it will be able to compete with or outperform Netflix. Coinstar CFO Scott Di Valerio may have made at least one indirect dig at Netflix however, playing on previous accusations that while the service does offer a vast wealth of content, it’s rather limited on up-to-date content.
“With Redbox, you get this great, great new-release content. Beyond that, we’re not going to speak to that because of competitive reasons,” said Di Valerio this Monday.
This week’s announcement therefore represent the conclusion of a rather well-publicized search for a carrier partner began by Redbox over a year previously. The venture will be owned to the tune of 35% by Coinstar – the parent company of Redbox – while the majority 65% will be owned by Verizon Wireless.
Following the new, Coinstar share prices saw a modest rally to finish trading on Monday 1.8% up.
Upon its launch, the new streaming video service will gain serious leverage not only from Redbox’s existing 28,000+ kiosks all over the US, but also the close ties Verizon has built with content providers by way of its own VCast streaming media service. True, this might not sound quite as exciting as the Netflix promise that users will never have to leave their homes, but by rights they also won’t be hanging around for at least 24-hours waiting for what they want to watch to arrive.
“By offering instantly available online and mobile content with immediate access to physical media through rental kiosks, Verizon and Redbox will be uniquely positioned to deliver the best of both worlds – digital and physical,” read and extract of the official statement released by the two companies this Monday.
While Netflix continues to dominate the market for streaming video services, a new wave of rivals is stepping up the offensive by the day. Hulu Plus and Amazon Instant Video for example have thrown down their own gauntlets, which despite having done little to dethrone Netflix have nonetheless given newcomers like Redbox a decent rundown of insights as to what might and might not strike a chord.