Redbox wants to be the Switzerland of the streaming wars

Comparisons to Netflix come often for streaming video services and they don’t always make sense. But in the case of Redbox, the two companies seem to have similar trajectories.

Netflix spent years building a physical media distribution business but has since moved on to become the biggest subscription streaming platform in the world. Redbox amassed an army of kiosks to similarly push DVDs and Blu-rays but has more recently focused on growing its digital business through AVOD and FAST services along with an upcoming SVOD channels service.

Redbox CEO Galen Smith, who helped guide his company through a recent merger and public offering, agreed with the comparison but noted that his company’s legacy kiosk business will still play a major role in getting the word out about Redbox Free Live TV and other digital services targeted toward “value-oriented consumers.” He said his company’s priorities for the rest of this year and next are centered on building a single app experience, accelerating marketing efforts at the kiosk, licensing more and better content, and cranking up the Redbox Entertainment original content machine.

Fierce Video recently talked Smith about how its SVOD channels platform will compete in a crowded marketplace, whether there’s a Redbox streaming device in the future and how the app will remain neutral in the streaming wars.

The following has been edited for clarity and length.

Fierce Video: Redbox has been rapidly expanding its AVOD and FAST services but you also have an SVOD channels business coming out next year. That’s a crowded space with lots of embedded players like Amazon, Google, Apple and Roku. How is Redbox going to stand out and compete?

Galen Smith: There’s a couple ways. One is, we serve a really different and unique customer base and I think it’s a hard-to-reach customer base. We’re able to, through our relationship with them, really be able to bring that to the fold. Last summer, we did a test with Showtime and in about six weeks we were able to help drive 60,000 new subs to Showtime. And this was an email bundled offer of nights at the kiosk plus a Showtime subscription. So, our ability to bring that to consumers in an email campaign, thinking about how much simpler to just subscribe in the app, it becomes a powerful opportunity.

If you think about our customer, they’re probably not spending $130 for an [Amazon Prime] subscription. They’re probably not spending $200 for an Apple TV device. With Roku, it’s really a destination for every app and you still have that same friction of going app to app to find what you want to watch. We want to help avoid that by having everything in our app. So, whatever you want to do, you’re able to do it right in one place. It’s a little bit different than what they’re offering today.

Fierce Video: What should we expect from Redbox in terms of premium subscription service and other partnerships?

Smith: We’ll continue to lean into those opportunities. We’ve found it to be very effective to work with our device partners. All 2020 Vizio TVs, for instance, have a Redbox button on the remote. We’ll continue to explore additional opportunities as we lean in further to helping consumers easily find our app and spend more and more time there.

On the channels side, we’re in the process of working with potential channel partners and getting them signed up. At a later date we’ll be announcing who those launch partners are and then we’ll continue to expand as we understand more and more what consumers want.

For us, it’s about providing that simplicity to the consumer and helping them make that switch. Think about the power that Redbox has…let’s say someone’s at the kiosk, they’ve found the movie they want to watch this week, they’re checking out, and in that checkout flow it offers you a free, seven-day trial for a subscription service. The power of having those 40,000 kiosks becomes a huge differentiator for us.

Fierce Video: Is there an opportunity to expand Redbox’s unified app experience into a streaming platform that could be licensed? Is there possibly a streaming device in the future for Redbox?

Smith: Today we’re really focused on building out our app experience. We’ll look for more distribution. We see ourselves as an independent player—a Switzerland, for lack of a better word—in the streaming space. So, we want to be a good partner to everyone. That’s really our focus and our goal. So, we think there’s an opportunity for us to help bring our customer base to these devices like we’re doing with Roku, and that’s probably a better use of our resources than doing our own device.

Fierce Video: It’s interesting to hear to you describe Redbox as a streaming Switzerland since the distribution disputes common in traditional pay TV have increasingly spilled over into streaming. It sounds like what you’re building with Redbox could be a way to avoid potential disputes.

Smith: Yes, we really want to be a great partner and we think we can provide our customers with great service and leverage the distribution of others. That’s why we’re doing the promotion with Roku because we’re helping to bring new customers to Roku through the sale of Redbox promotion-led devices at Walmart.