Why Wouldn’t Netflix Sell the DVD Business to Redbox?
By Phillip Swann
The TV Answer Man – @tvanswerman
TV Answer Man, I read that Redbox wants to buy Netflix’s DVD business which it’s closing but Netflix doesn’t want to sell. Why wouldn’t they want to sell? They are closing it so why not pick up a few dollars? — Paul, Rochester, New York.
Paul, Netflix announced last week that it was closing its DVD/Blu-ray mail rental business in September after 25 years. The move is not surprising. Netflix says that DVD mail subscriptions have fallen under two million and revenue from the business has become a tiny fraction compared to the booming streaming unit.
However, one company thinks Netflix’s DVD business still has some life in it. Bill Rouhana, the CEO of Chicken Soup for the Soul Entertainment, Redbox’s owner, tells The Hollywood Reporter that he has approached Netflix multiple times about selling it. The mail DVD rental unit might be a nice compliment to Redbox’s kiosk rental disc service.
“I have tried like three or four times to reach out to the corporate development people about it but just got rebuffed each time. So when I saw it being closed, I thought, ‘Well, maybe they’ll do it now,'” Rouhana said.
However, The Hollywood Reporter writes that a Netflix source says the company has no intention of selling the DVD business.
Why wouldn’t Netflix sell? Money is money, right? The unit is closing anyway so why not get a few more dollars from the old girl?
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My guess is that Netflix believes that a Redbox sale would help boost the DVD business at a time when Netflix wants to keep the world focused exclusively on streaming. That is Netflix’s priority now. While the sale would bring in some money, the relatively small amount that Redbox would pay for less than two million subscribers is not worth it to Netflix. Putting another nail in the DVD category is more important.
Paul, hope that makes sense. Happy viewing and stay safe!
Have a question about new TV technologies? Send it to The TV Answer Man at swann@tvanswerman.com Please include your first name and hometown in your message.
— Phillip Swann
@tvanswerman
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Your answer doesn’t really make sense, in fact, it directly contradicts what Netflix says: “Netflix says that DVD mail subscriptions have fallen under two million and revenue from the business has become a tiny fraction compared to the booming streaming unit.” Negligible, tiny. Plus, just because Netflix would lose a DVD customer, doesn’t mean they’d lose a streaming customer. I have and do use both. So why would Netflix care if their DVD business continues under Redbox? It also screws the Netflix people working in the DVD business if they have to lose their jobs too. If Netflix can’t have it, neither can Redbox? Makes no sense. Shame on Netflix for screwing their DVD customers and their DVD employees …
Reminds me of the time SyFy Channel cancelled their most popular show, “Face Off”, and refused to sell the rights to another network to continue the series. Idiots.
You’ve neglected the part where Redbox is $300+ million in debt. Redbox’s CEO is just squawking about making an offer (that they can’t actually make good on) to get their names in the headlines.
Ironically, the DVD customers are streaming customers as well. Disgruntled Netflix customers may drop their streaming service and Netflix loses that revenue stream.
What will Netflix do with all their DVD and Blu-ray Discs?