Redbox Environmental Analysis

1387 words 6 pages
The company I have chosen to do the external environment scan is Redbox.
Redbox is in the movie rental business via self service kiosks. Redbox is wholly owned subsidiary of Coinstar Inc.

Laws and Regulations:

There are some specific laws and regulations under which the movie rental business like Redbox should operate. But due to the growing popularity of renting videos through mail, online and kiosks, most of these laws will probably have to change or modified to fit the new way of people renting and watching movies.

Age of Renters – This law for who can rent specific videos follow the same guidelines set by Motion Picture Association of America. These guidelines are based on their content, language, sexuality, violence and
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Thus you can see that Redbox understood the importance of fostering a collaborative relationship with its suppliers to remain profitable in this business.

Competitors

There are other players in the movie rental business. Some companies like Moviecube, DVDXpress, DVDPlay also use DVD vending machines for this business. The DVD vending business have approximately 19% of the market share whereas the Rent by mail service (ex. Netflix) accounts for 36% and 45% share goes to the Brick and Mortar stores (ex. Blockbuster). Movies can also be rented and watched by on demand movie networks offered through cable and satellite network. Delivering movies online through the internet is also getting popular. Redbox currently has around14% of this market share.

These companies compete with each other mainly in terms of price and how the product is delivered to the end customer. Some customers still prefer getting their DVDs by mail instead of driving to a kiosk and possibly waiting in line to rent or return a movie.

Also, movie theaters and TV channels are also indirect competitors within this business.

New Entrants

Yes, new entrants are quite possible for Redbox. Though there are some barriers of entry for new entrants, it is quite possible for existing players in this industry to expand their products to compete with Redbox. For example, Blockbuster recently filed for Chapter 11 Bankruptcy. This will give Blockbuster the ability to totally re-organize and try to

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