Redbox pays $100 million for NCR's Blockbuster Express
Redbox announced today that it has acquired the assets NCR's entertainment business for $100 million. — NCR is a company that specializes in retail kiosks and it began operating more than 10,000 Blockbluster Express DVD kiosks …
Context & Ripple Effects
Redbox has spent two years building leverage before this purchase: a confirmed multi-year Warner Bros. deal accepting a 28-day new-release window back in February 2010, a customer survey about a streaming service reported in April 2010 (streaming ambitions Redbox never confirmed), and an October 2011 decision to raise rental rates rather than ride Netflix's pricing turmoil. Buying NCR's entertainment business converts that position into outright market control of the kiosk channel.
The $100 million asset purchase hands Redbox more than 10,000 Blockbuster Express machines — effectively absorbing the last at-scale kiosk rival while NCR retreats to its core retail-kiosk business. Syndication was broad on day one (BGR, GeekWire, Dow Jones Newswires among others), with Fast Company's pickup pairing the deal against the same-day Verizon streaming headlines, framing Redbox as a company buying physical scale just as it edges toward digital.
First-order effects
- Redbox instantly gains over 10,000 additional kiosk locations, removing Blockbuster Express as a competing machine network and giving it near-total command of US disc-rental kiosks.
- NCR exits the entertainment rental business entirely, taking $100 million and refocusing on its core retail and ATM kiosk operations.
Second-order effects
- With no meaningful kiosk competitor left, Redbox's negotiating position with studios hardens — the kind of scale that let it accept Warner Bros.' 28-day window in 2010 now applies across a near-monopoly footprint, raising the cost to any studio of withholding content.
- Netflix faces a rival that can bundle cheap physical rentals with a possible streaming offering, pressuring it to defend the value-priced end of the market it alienated with its 2011 price changes.
Third-order effects
- If the pattern holds, physical disc rental consolidates into a single gatekeeper whose kiosk economics become the floor price for home entertainment — forcing studios to treat the kiosk channel as a priced partner in the digital transition rather than a discount nuisance.
- A consolidated Redbox with cash flow from dominance is structurally positioned to fund the streaming entry it surveyed customers about in 2010, turning a hardware winner into a potential hybrid distribution platform.
The trend: Home video rental is consolidating around one kiosk operator even as studios push digital delivery, making Redbox the last-scale buyer of physical distribution infrastructure.