Although many details behind what happened during this last year for Redbox were not released it is now clear that the video streaming service was operating at a loss. Furthermore, the site even took a precautionary decision of shutting down new signups after indications that hackers were trying to use data to credit card fraud.
Some analysts consider that Redbox didn’t manage to become profitable and stand up against Netflix so quick because it chose a different strategy and didn’t offer unlimited video streaming. Redbox looked to offer a slightly different business model. It combined smaller selections of on-demand video titles which it offered for instant-streaming along with monthly vouchers that could have been used in any Redbox kiosk. Plans started at $6/month but the idea just didn’t really catch on.
