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Online Video Streaming Could Be The Next Battlefield

by Sean P. Aune | April 21, 2010April 21, 2010 4:45 pm PDT

Now that Redbox and Netflix have pretty much damaged video stores beyond repair, where do these two new business turn their sites to gain more customers?  Well, if a new survey is any indication, it appears that Redbox may be turning its sites to Netflix and could lead to a whole new fight in the fledgling video streaming industry.

Netflix has a history of “announcing” new features and services by asking about them pointedly in surveys;  This was the method that people first learned of streaming capabilities coming to the PS3, Wii and the iPhone OS.  Now it appears that kiosk vendor Redbox may be following suit, and according to High-Def Digest, if what the latest survey asked proves to be real, we could be seeing a whole new video war dawning.

redbox kioskApparently the Redbox survey sent out to some customers asked if they would be interested in an unlimited streaming video service that would cost $3.95 a month, less than half what Netflix’s cheapest option is that includes unlimited streaming.  This $3.95 service would also include coupons for free rentals from a kiosk per month, and since their rentals cost a $1 per night, that would essentially make the streaming service free.

If this does prove to be something the Coinstar-owned company is working on, it would certainly undercut Netflix which is expected to grow by two million subscribers this year just from people subscribing via their gaming consoles.  And that may be where this Redbox plan has the potential to fall apart.

Netflix has a huge lead on any other company wanting to enter this arena due to the fact it has struck deals with so many hardware manufacturers to include its software.  You can find Netflix Watch Instantly access built into TVs, media streaming devices, gaming consoles, Blu-ray players and more already.  This isn’t to say a company like Redbox couldn’t do the same, but it would be playing catch up for quite some time before it got to the potential installed user base that Netflix already has.

There are two other rather big questions that linger.  The first being that Redbox has a tenuous relationship at best with most of the Hollywood studios that is just beginning to cool after it agreed to the 28-day rental days that Hollywood requested.  The company might have some problems striking deals with the studios for content, especially at that low of a price point.

The second issue would be can the market really sustain two such services?  While Netflix Watch Instantly is a nice addition to the service, most of the content is older, and has made many people question if its worth having.  If another company was to come along and be dumped into the same content boat, would people really care?  Unless Redbox somehow managed to get newer releases into their system, it would probably be difficult for the company to get people to switch over from the service they are already established with.

A competitor to Netflix is pretty much inevitable, and streaming media does seem to be the future, but there are going to be some pretty big hurdles for any company to try to catch up with them at this point.


Sean P. Aune

Sean P. Aune has been a professional technology blogger since July 2007, but his love of tech dates back to at least 1976 when his parents bought...

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