Redbox Not Worried About Streaming Eating Away At Rental Business

"I think that both can live side-by-side," director of gaming says; Xbox One, PS4, and Wii U games now available at kiosks in 10 select markets across the US.

Kiosk-based movie and game rental company Redbox is not worried about streaming services like PlayStation Now or the secret tech demo Microsoft is working on impacting its business. That's because, according to Redbox director of video games Ryan Calnan, people still prefer physical discs. And even if streaming does become mainstream, both can live together in peace, he argues.

"I don't see [streaming] as a challenge," Calnan told us. "I think that both can live side-by-side. We're expanding the edges of gaming, and I think that customer is very much attached to that physical product still."

Calnan added, "There's obviously this emotional relationship to the physical disc." Indeed, a recent NPD Group study found that 74 percent of American gamers would choose a physical copy of a game over a digital unit if pricing was the same.

"There's obviously this emotional relationship to the physical disc" -- Ryan Calnan

When PlayStation Now was originally announced in January during the 2014 Consumer Electronics Show, shares of retailer GameStop tumbled, though they have since rebounded.

Also during our interview with Calnan, we quizzed him about when we might see Xbox One, PlayStation 4, and Wii U games in Redbox kiosks nationwide. He said Redbox has already launched a pilot program in 10 markets (Denver, Seattle, Chicago, and Atlanta are a few), and the response has been positive.

"We are testing new-generation product in select markets. We're encouraged by our success so far where we've been testing this product," Calnan said. "We're excited to be rolling this product out over a period of time as our customers transition from the current gen over to the new-generation systems."

While the Xbox One and PlayStation 4 have shown positive signs right out of the gate in the test regions, the same can't be said for the Wii U, Calnan said.

"We've been very happy with the success of Xbox One and PS4; I think we've had a little bit slower [uptake] on the Wii U, much like the retail marketplace," Calnan said. It's no secret that the Wii U has struggled, but Nintendo sees better times ahead, thanks in part to the release of marquee titles like Mario Kart 8 last month and mascot brawler Super Smash Bros. this fall.

So when will Xbox One, PS4, and Wii U games be rolled out to a wider market at Redbox? Right now, it simply makes more business sense to keep the kiosks stuffed with last-generation games because the install base is so much larger than it is for current-generation systems. But Calnan expects that, over time, this will shift.

"For us, it's about adoption to that [new-generation console]," Calnan said. "We obviously have an incredible base of customers that already own the [last-generation consoles] and we're just waiting as they transition over. But we want to make sure that we can offer the current-gen product to all those customers who have not yet transferred over."

Redbox rolled out its video game rental program in 2011, and the company has no plans to slow down anytime soon. Why is it that Redbox has found success where others haven't? According to Calnan, Redbox hits two major notes better than anyone else out there: convenience and price.

"You don't have to make a dedicated trip to find a Redbox. If you're going to pick up milk and bread or you're putting gas in your car, Redbox is there," Calnan said. "And that really gives the opportunity to go ahead and try out the product. A dedicated trip is obviously something where you have to think, 'Oh, I've got to go out and do this.' Redbox is on the way, and very, very convenient because of that. And that $2/day to try out a game, it's a pretty compelling argument for somebody who may not know everything about the latest title that's come out and wants to try it out."

Eddie Makuch is a news editor at GameSpot, and you can follow him on Twitter @EddieMakuch
Got a news tip or want to contact us directly? Email news@gamespot.com

Written By

Eddie Makuch is a news editor at GameSpot, and would like to see the Whalers return to Hartford.

Discussion

22 comments
VegasAceVII
VegasAceVII

They're right, not everyone has an internet connection capable of streaming video games.  RedBox will be fine.

Thanatos2k
Thanatos2k

How are they not worried?  Blockbuster is dead.  They will be too, eventually.

JtheGrind
JtheGrind

Yea I still use redbox all the time...it's still cheaper, a lot of red boxes are around. Even if you return it late 2 days later, it's still cheaper. Streaming using netflix still has it's drawbacks, with long loading times (every so often),etc.. Don't get me wrong, Netflix is still a great service. I just see room for both to thrive...

megakick
megakick

netflix streaming sucks if you want to watch recently released on video movies and the other services charge a lot per movie so I doubt redbox has much to worry about.

imajinn
imajinn

Redbox is a solid option. I love that they are in super markets, etc. I use gamefly mostly, but i dig redbox for the their prices and location conveniences.

smartest_gamer
smartest_gamer

There are stil. people that dont believe that the internet exists. 

blprater
blprater

Well currently it's cheaper to rent a game from Redbox than it is to stream from PS Now. 

Asm92784
Asm92784

I have a Family Video store just a couple blocks away, so I tend to rent from them far more than I do redbox as its usually cheaper at Family Video if you plan on keeping it for more than just 1 day. I still prefer discs over digital when buying, but honestly for rental, if the price is the same, after being in the beta for it, I would probably just go ahead and use Playstation Now over going to redbox or family video, since either way I'm not keeping it after the rental period. But I really dont rent games that often anymore anyways, maybe once every few months.

Martyr77
Martyr77

Redbox is cheap and convenient for me so I support them completely.

TheCyborgNinja
TheCyborgNinja

Redbox will survive until rural areas get fast, cheap internet access. A lot of those places still have video stores...

Sevenizz
Sevenizz

So when Redbox gets bigger - will they open stores? Blockbuster 2.0?

It's an odd venture in the Internet age. Sure, it's 2 bucks - but having to go out to rent and return takes time and effort I don't think many will care paying the extra few bucks to avoid.

unban_porygon
unban_porygon

I was once trapped in a muffin,yet i wanted to go and tricycle so bad that all the halloween set my pants on fire, where my cousin was bald and had a chicken body ,he ran in circles around my shoulder while i did bite off rabbet heads smear the blood on him and start chanting things while standing on a banana and screeching like a slaughtered pig, those bloody animals will never stop moving there lawn even in the winter solicitous contest, we would have to drive motorcycles underwater to keep the watches afloat,but while we did that little did we know that a evil pair of sunglasses was sticking down at our fire,and sending trickling coats to our dismay. I gust wanted to jump without limitations.i like my dog eat an anchor, i cant help the can not to do today,but in the world we only kill our lamas to sleep in my doughnut bar with some cyclers eating my shoe. my pants that halloween set on fire burned my legs to a crisp witch set dogs out to find me, i had escaped from jail. My prison mates were embodied souls in witch the hot dog director sucked out there brains and fed them to us again and again. this is in witch we do not everyone but we nothing our escape route. In not sure that anyone will ever understand that the mouse will always shoot hazers at us because we are simple . So the chicken bodies prison mate tackled the hot dog vampire and shouted: all more and all none” winch means he wanted abeam care for his pet mutants son in law to go to saturn and burn halloween and Christmas embodiments in one extra large sieving of nachos. Meanwhile my great graft aunt was finding some live lobster hats to eat a giant battle axe showed up and cut the bread for my neighbors house. I wanted too shot him to and he was they guy on my shoulder as well,and the battle between hot dog and chicken had begun when i was in the way. we din’t listen. and my head was severed by the vampire hotdog, so i flew around my body spurting vomit through my cut esophagus. and my head floated and shot sunglasses and halloween out of its eyes and mouth. While i was doming that christmas and the axe and the choking chicken met up and planned how to destroy the try cling coats witch indeed had latex gloves on there heads. their path to victory was short a suddenly christmas met fourth of nachos and set the sky ablaze it was my dog. My pants are still burned to a crisp with then i captured the giant sunglasses and squeezed them into my next cup of joe,which then i did not know was my best friend joe jot grinded into coffee beans beans are yum and i was drinking him write now. little do i need to understand clll that i and we have said and done over the past A50,000,000,000.095986450 years that i have been in jail and that i want a lawyer because halloween died at Christmases hands and my chicken prison mate ate himself,i am again alone in this word for i ate Christmas and the axe, so i flew into my dog the last time i ever will again that i ever wanted too.


... but really though I do not want to embrace a 'cloud only' future when it comes to digital media related products. Maybe for stuff like files and documents stored on cloud servers I'm cool with but for there to be no disc-based version of games 10+ years from now would only serve to reduce consumer choice as the bottom line.

LilKCCeleb
LilKCCeleb

Only if you have crappy internet. Get Google Fiber like me. Loads instantly.

EasyComeEasyGo
EasyComeEasyGo

Not really, when I'm going to work/home, I pass my food market that has Redbox all the time so I use Redbox from time to time.

AzureBonds76
AzureBonds76

@tableofjapan  The BETA so far is an epic fail. I have it and haven't tested anything so far (except for playing Dead Island Riptide for about 15 mins), since it is not free. Paying to beta test someone else's product: priceless.