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Redbox Streaming Service To Shut Down October 7th
An anonymous reader writes: Redbox, the company behind the giant red boxes at malls and grocery stores that dispense DVD and game rentals, partnered with Verizon in 2013 to launch a video streaming service to compete with Netflix. This naturally led to accusations that Verizon was throttling Netflix to tilt the scales in favor of Redbox. Well, as of Tuesday, they're packing it in. Redbox's streaming service will shut down at the end of the day on October 7th. They'll be refunding all current customers, though that number took a hit over the past several months as a credit card fraud problem caused Redbox to shut down their billing servers. This meant no new customers could sign up, and existing customers couldn't renew their subscriptions.
If you can't let your customers send you money, then there's not much point in being in business. Also, whoever was responsible for setting up their payment system won't be laying claim to that fact in their advertising and testimonial material.
RedBox was a scam. It wasn't a technical issue that shut them down. It was most likely the number of charge-backs that did. I'm just surprised that it took this long.
They would frequently email you rental coupon codes that allowed you to rent a movie for free (which really, was the only reason I'd get a movie from them, their selection was mostly B movies that you had already seen, or that you wouldn't bother to rent in the first place, so when I had a free code, I'd force myself to to go through their selection to find something I'd like). Then three months later, after having returned your movie on time three months earlier, you'd get a ridiculous charge on your credit card for not having returned the disc to the right rental kiosk.
The main problem was that there were two kinds of red rental kiosks, sometimes they were both even in the same store. One was called RedBox. And I forget what the other was called. In theory, they were both owned by different companies, but in actual practice, they were both using red kiosks and very similar branding, they both accepted the same custom DVD plastic cases, and according to other customer complaints, both boxes were also operated and serviced by the same technicians.
And the large fine would work both ways, you'd get a DVD from RedBox and accidentally return it to the wrong one, or you'd get a DVD from the other one and accidentally returned to RedBox (either because you were an idiot, or because you told someone else in your household to return the movie to a red box), and the drastic outcome was identical. Even thought the company had your email address on your file, it didn't bother to notify you that it didn't receive the DVD on its end. It just charged you after three months. And even thought, this problem was happening very frequently and the boxes both shared the same company that serviced them, the companies were apparently not capable of telling each other about any extra DVD they had received by mistake.
Which is why I think this systematic failure on their end was really an intentional attempt at defrauding people. No doubt, the start up had a legitimate business model at the beginning, but once it couldn't compete on selection (even for the extra convenience and the very reasonable price of $1 a day), instead of opting for bankruptcy, it started scamming people in a systematic way.