Why You Should Care About the Redbox Acquisition
Brit McGinnis
177

I’ve read this several times and I can’t follow it at all. Why are you describing this like it’s a bad thing for Redbox? You make it sound like Redbox is on the chopping block, and that this is somehow indicated by the buyout. But since when is a buyout a signal of a company’s failure? Yes Redbox’s sales have been declining, but both the Forbes and Home Media Magazine articles you link to clearly say that the buyout is a good sign, and good thing, for the company:

“Outerwall said that the private equity buyout will help it to strengthen its kiosk business. ‘Apollo is an ideal partner to support Outerwall’s efforts to continue serving our millions of loyal customers and dedicated retail partners through our unrivaled network of kiosks and automated retail offerings,’ said Outerwall CEO Erik Prusch in prepared remarks.”

“Private equities group’s $1.6 billion acquisition of Redbox parent, Outerwall, underscores confidence in physical distribution channel… Apollo Funds’ $1.6 billion acquisition of Redbox parent Outerwall would appear to be a shot in the arm to packaged media and physical distribution of DVD and Blu-ray Disc.”

I also don’t understand the disdain for Outerwall. “Redbox’s parent company might have spent time on the wrong things.” Why were Coinstar, Gazelle, and ecoATM the wrong things? Are they failing, or taking away from potential greater success of Redbox or Outerwall? You seem to like Gazelle, and I can’t tell if you actually think ecoATM is a good idea. Later you say “Outerwall owns other cool brands” which sounds like you don’t think they’re a waste of time? “…The people who bought Outerwall paid over a billion dollars for its sorry behind” — so you don’t think Outerwall is worth that much, even though you think Redbox provides a valuable service? I’m super confused about why you’re for the brand but against the company.

The buyout actually seems to prove that physical media is NOT yet dead and still has financial/business supporters. This is good news for Redbox users, but you’d never know it from this article.

…Or maybe I misread the whole thing and you think this is weird and dumb because physical media is already over so why would someone pay so much to try to revive Redbox, and Outerwall should have focused more on Gazelle and ecoATM instead as “better” brands?

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