Redbox is raising prices on DVD rentals from $1 to $1.20 due to higher operating costs associated with debit card fees. It marks the first time in eight years that the unit of Bellevue-based Coinstar has increased daily DVD rental prices.
“The amount was selected to best offset expenses, while keeping our value commitment to customers. We conducted several months of testing and with careful consideration, decided the 20 cent adjustment would work best to keep prices as low as possible,” the company wrote on its Web site.
The new pricing goes into effect on Halloween. It follows a series of high-profile miscues at rival Netflix, including a price increase of its own which caused a customer revolt and the ultimate cancellation of the Qwikster DVD spin out.
Redbox operates about 34,000 kiosks across the country, and the unit just passed $1 billion in revenue for the first three quarters of the year.
Shares of Coinstar are down about seven percent today after the company announced the plan and its earnings. For the third quarter, Coinstar reported revenue of $456 million — a 22 percent increase — and operating income of $65 million.