Redbox to rent video games

Starting Friday, renters can get video games in addition to Redbox's traditional movie offerings.

By Kim Peterson Jun 16, 2011 4:23PM
Redbox, owned by Coinstar (CSTR), is beating Netflix (NFLX) to the video-game punch.

Starting Friday, the company will begin renting video games at 21,000 stores across the United States, the Associated Press reports. The games will rent for $1.50 a day. Redbox already charges $1 to $2 to rent DVD movies for a day.

Redbox has been testing video-game rentals since 2009. The move gives the company an advantage over Netflix, which doesn't rent video games. Some of the games available at Redbox will include "Call of Duty: Black Ops" and "LA Noire."

Only the top three consoles -- the Nintendo Wii, the Xbox 360 and the PlayStation 3 -- will get games from Redbox. The Nintendo DS, as of now, will be overlooked, VentureBeat reports. Coinstar shares closed up 1% today to $47.26.

Gamefly has led the way so far with rent-by-mail video games. Will Redbox annihilate the company? Since Redbox hasn't hurt Netflix's business, VentureBeat guesses Gamefly may be OK.

By the way, why did Citigroup (C) upgrade Netflix to a $300 price target? The stock closed at $249.90 today. The bank's analyst explains the move in the following video:


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