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Netflix CEO remains adamant about staying out of kiosk space

July 23, 2009

In the past, Netflix chief executive Reed Hastings has said the company won't be expanding its service to include DVD-rental kiosks, despite increasing competition from redbox and other kiosk companies. The Baltimore Sun reports a recent exchange regarding the kiosk issue between Hastings and an attendee to Netflix's second quarter earnings conference call:

QUESTION: Last quarter you said you had no interest in entering the kiosk business. Has that sentiment changed at all, now that it appears studios are warming up to the concept?

REPSONSE: No, not particularly.

The kiosk businesses are very good vending machine businesses. Coinstar (has) been doing vending machines on a global basis for a long time and they have a wide range of vending solutions and presumably they will come up with more and more vending innovations. So they're organized horizontally as a vending machine company.

We're organized vertically and we happen to be in DVDs now. It's DVD and (Internet) streaming as a movie brand. Netflix will always be in movies, not in various ways to ship or move discs or any other aspect. So the businesses are really organized quite differently and we have no incentive to go into kiosks. We are putting all of our innovation efforts ongoing into streaming.

The paper reports that redbox estimates about 5 percent of its renters are former Netflix subscribers.

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