DVDPlay game for Safeway
FROM VSDA: Kiosk company hopes to install 200 machines a month
By Susanne Ault -- Video Business, 7/13/2006
JULY 13 | LAS VEGAS—After about a year in limbo, DVDPlay has recommitted to installing rental kiosks in the entire Safeway grocery chain.
The company first moved its machines into Safeway stores in spring of 2005, but DVDPlay stalled after 60 locations due to lack of funding. Now, after a $40 million infusion of capital and the appointment of new CEO Chuck Berger (VB, 6-27), DVDPlay is set to roll into 1,600 Safeways by the middle of 2007.
Based in Los Gatos, Calif., DVDPlay is hoping to add new kiosks at a peak rate of 200 machines per month.
Although DVDPlay experienced the expansion hiccups, Berger is confident the company now has the resources to succeed.
“We plan to buy over the next four years $250 million in DVD product for rental and sale,” Berger said.
At this point, DVDPlay just rents new release movies. It hopes soon to sell used DVDs as it ramps up its presence.
At 300 locations, mostly in supermarkets and on military bases, DVDPlay remains one of the smallest disc kiosk providers. Redbox stands at 1,400 locations across McDonald’s stores and groceries. TNR Entertainment expects to move into 1,000 spots by the end of 2006.
Initial Safeway results prove that DVDPlay’s formula is working, said Berger.
On average, “people go to grocery stores about two times a week,” he said. “Over 50% of [Safeway] renters bring DVDs back within a day. So clearly we are driving people back into the grocery [store] more times than they would go normally.”
