CHAPTER 18

Movie Studio Negotiations

Part Two: Redbox Versus Disney, Lionsgate, Paramount, and Sony

Redbox Versus Disney: You’re in the Penalty Box

Disney was the only studio with the high-risk, high-reward movie slate consisting of only a dozen big-budget movies. These costly franchise films generate huge revenues from theaters, licensed merchandise, and DVD retail sales, but the DVD rental revenue was relatively small. Disney and Redbox were in a unique situation where neither partner needed a direct relationship to be successful. Disney believed their high-quality franchise films had the highest rate of Redbox cannibalization than the other studios. They were the only studio not compelled to agree to a three-year $300 million contract with ...

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