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Redbox Signs Distribution Pact With Warner Bros.

Posted On: 2/26/2010

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Redbox, CoinstarOAKBROOK TERRACE, IL -- Redbox said it has dropped a lawsuit against Warner Bros. Home Entertainment Group after striking an agreement with the studio that allows the Coinstar subsidiary to rent new-release DVDs and Blue-rays through its kiosks 28 days after the latest discs hit the shelves.

Warner officials said the 28-day delay allows the studio more time to sell new DVDs in stores without competition from Redbox's $1-a-night rental kiosks. Through the agreement, Redbox will pay less for the studio's discs and be supplied with enough copies to satisfy demand. The pact also requires Redbox to destroy discs rather than resell them when it is done renting the movies.

The two-year distribution deal ends Redbox's lawsuit against the studio filed in August. Redbox has sued several studios for limiting its access to new-release movie discs, and reached agreements last year with Sony Pictures Home Entertainment and Lions Gate Entertainment to distribute new DVDs on their release dates. Paramount Home Entertainment currently offers titles on a limited basis through Redbox.

The self-service DVD rental giant remains in legal battles with 20th Century Fox and Universal, which it says continue to unfairly restrict its access to new releases for distribution to its more than 20,000 machines nationwide.

Without distribution deals with some of the largest studios, Redbox has reportedly been purchasing 40% of its new-release DVDs from Walmart and Target stores. Pressures mounted this month when the retail giants reportedly imposed strict limits on the number of DVDs any one customer could buy at one time to ensure new releases are accessible to as many customers as possible. Read more about DVD purchase limits.