Redbox Instant, the streaming-movie joint venture between Redbox owner Coinstar and Verizon, is now available to the general public.

The public launch ends a three-month closed testing period for the service that saw “hundreds of thousands” of interested people sign up, CEO Shawn Strickland told GigaOM today. He also said many of those that joined Redbox Instant’s free trial stuck around to become paying customers.

The service, which launched into beta back in January at the Consumer Electronics Show, will start at $6 per month for access to a “free” catalog of over 4,500 streaming movies. For another $2 per month, users will get four Redbox credits to rent movies from the physical DVD kiosks. Those credits expire at the end of every month, so the most you’ll ever be able to watch under the plan is four physical movies.

Originally, the service was thought to directly compete with the likes of Netflix, Hulu, and Amazon Prime Instant Video, but this may not be the case. Redbox Instant will focus on newer movies and cater to customers who still value physical DVD rentals, and could fill in the gaps that Netflix can’t cover, according to Strickland.

Do you plan on signing up for Redbox Instant? Let us know why, or why not, in the comment section below.

Photo via Sean Ludwig/VentureBeat

Soon, Netflix subscribers in the U.S. will be able to connect their accounts with their Facebook profiles thanks to new legislation that the Senate just passed.

While the majority of digital media services have benefited from the social network giant, Netflix has previously been noticeably absent from Facebook’s Timeline feature due to a 1988 law that forbids video rental services from sharing a customer’s rental history. The current law, Video Privacy Protection Act (VPPA), was initially created for the purpose of concealing physical media rentals, but until now, Congress hasn’t clarified whether digital video rentals also fall under the law’s jurisdiction.

The new law should allow Netflix to automatically share your viewing activity with your friends on Facebook, Twitter, and other social services. The House of Representatives, which has previously passed an amended version of VPPA, has also approved the new legislation. It should be signed into law as soon as it gets a signature from the president.

This is a big win for Netflix, which has been fighting for this kind of clarification for over a year. The company has previously stated that Facebook integration helped grow subscriptions and increase usage in other regions, such as Canada, Latin America, and the U.K.

Via Bloomberg

Digital video store service M-Go has reached content agreements with five major film studios to rent or buy movies and TV shows the same day they’re released to other retail outlets.

M-Go, which is a joint venture between Technicolor and Dreamworks, wants to become a major player in streaming video. And while it seeks to compete with the likes of Amazon in terms of its video library and platform support, you may not have heard of M-Go, which is expected since it won’t official launch until later this year.

Netflix is expanding its streaming video service into four new European markets, the company announced today.

The company first announced that it would be expanding into new markets during its Q2 2012 earnings call, but it declined to share exactly what those markets would be until now. Netflix is coming to Norway, Sweden, Denmark, and Finland sometime later this year. At this point, the company is staying quiet about pricing and content selection. However, it’s safe to assume Nordic customers will be getting a huge batch of new-ish movies and TV shows that can be viewed an unlimited number of times for one low monthly fee.

The move is part of Netflix’s overall business strategy, which includes expanding into foreign markets using profits from its domestic business. The company has already launched successful expansions into Canada, the U.K., Ireland, and Latin America. In the past, entrance into new markets caused Netflix’s overall profits to dip, which wasn’t popular among investors.

Still, it’s hard to disagree with Netflix’s strategy. As VentureBeat has previously pointed out, international expansion is perhaps the best plan of attack for the company to continue its rate of steady growth (both with its service and profitability). This is especially true since Netflix CEO Reed Hastings seems intent on avoiding new revenue streams, such as temporary rentals of newer movies or selling digital copies of movies.

The senate is expected to vote on an amendment next week that would allow video rental services like Netflix to take advantage of deeper integration with social networks like Facebook.

Despite being the country’s largest streaming movie service, Netflix is noticeably absent from Facebook’s Timeline feature due to a 1988 law that forbids video rental services from sharing a customer’s rental history. The law, Video Privacy Protection Act (VPPA), was initially created for the purpose of concealing physical media rentals, but congress has refused to say if digital video rentals also fall under the law’s jurisdiction.

As a cautionary measure, Netflix, which offers both physical and streaming rental services, has operated as if the VPPA did apply to digital media. This is why services like Hulu feature deep Facebook integration, while Netflix does not. In February, the company also decided play it safe by settling a class action suit related to violating the VPPA, as VentureBeat previously reported. The settlement cost the company $9 million, and made them agree to delete all rental history data from a customer a year after they formally cancel their subscription.

Not being able to utilize Facebook is something that Netflix desperately wants for its U.S. service. Several media services — including Spotify, Ustream, Viddy, and others  — that previously integrated with Facebook’s Timeline have experienced huge traffic and subscriber growth. Facebook integration has also helped grow Netflix service in international markets, the company stated in its Q2 2012 earnings report.

But despite its setbacks, Netflix is taking steps to persuade congress to change the VPPA law.

In April, Netflix formed its own Political Action Committee (PAC) called FLIXPAC to help rally congress on issues important to its business (like a VPPA amendment). The company has spent a total of $395,000 this year on lobbying efforts, according to political news site The Hill. Also, the House passed legislation in December 2011 that would give Netflix permission to share data via Facebook with a subscriber’s consent.

The amendment, which Sen. Patrick Leahy (D-Vt.) drafted, could be voted on next week as part of another cyber security bill. Leahy’s involvement is particularly interesting because he previously wasn’t keen on allowing rental data to be shared in any form. During a senate hearing in February, Leahy even described the aforementioned House bill as “dominant corporate interests (enticing) a check off in order to receive what may seem like a fun new app or service.”

Leahy’s change of heart could have something to do with senate democrats trying to gain support for an amended version of the Lieberman-Collins Cyber Security Act (aka the senate version of CISPA), which the senate is also expected to vote on next week.

Illustration by Tom Cheredar; Photo via Fox Business

Netflix has dethroned Apple as the largest online movie service in the U.S. for 2011, according to a new report from IHS iSuppli.

The data intelligence firm’s conclusion is based on Netflix’s total revenue last year, and indicates that the company’s overall market share in online movie services grew by 44 percent compared to the previous year. Mind you, that growth comes despite Netflix’s various screw-ups, such as its plan to spin-off the DVD-by-mail part of its business into a separate entity, a 60 percent price hike, and generally ignoring its customers. (It’s worth noting that Netflix seems to have weathered most of those storms judging by its current subscriber numbers.)

Meanwhile, IHS’ data shows that Apple’s 2011 iTunes market share of online movies was cut in half and dropped to 32.3 percent compared to last year. These figures undoubtedly played a role in Apple’s decision to start letting Apple TV owners sign up/subscribe to Netflix using their iTunes account back in March. While nothing has been publicly disclosed, its presumed that Apple is getting a percentage of every Netflix customer that pays through iTunes — a move that’s probably proving more profitable than Apple’s video rental and purchase sales.

In the report, IHS Digital Media Research Director Dan Cryan notes that the online movie business is also rapidly changing. Consumer spending more than doubled to $992 million in 2011 compared to the previous year, while traditional retail store movie sales dropped 12 percent to $8.8 million. Cryan also points out that there is a limit to how much you can even compare Netflix to Apple.

“Effectively the market has split,” Cryan said. “Netflix and Apple are competing for some of the same consumer time and money. However, the core value proposition of the two services is actually very different.”

Given the choice between accumulating dust or money on useful stuff you own, most people would likely go with cash. That’s the driving idea behind RentStuff, a service that lets you rent out useful possessions to people nearby.

RentStuff closed a $600,000 round of funding today, the startup told VentureBeat exclusively. Essentially, RentStuff functions like an Airbnb for items. But instead of spare bedrooms, you’re making money on neglected stuff around the house.

With the exception of weapons, you can list pretty much any physical item for rent on the service, including laptops, camera lenses, moving trucks, bikes, recording equipment, etc. The rental price and availability are both determined by the item’s owner, who also arranges a time and place to drop off/pick up the item from the renter.

The owner can also set a security deposit for each item listed. Both the rental amount and the security deposit are charged to the renters’ credit card only after both parties have met and confirmed the initial exchange, which can be done via email, text message, or directly on the RentStuff website.

“When I’m traveling, it’s easier for me to rent a good bike on RentStuff than it is to take mine on a plane, and haul it around to wherever I’m staying,” RentStuff co-founder Chris Jaeger told VentureBeat. With the explosion of lodging services like Airbnb, he said its only natural that people would want access to some of the other comforts of home. I can also see the advantages in paying a few bucks to rent out a gadget that I’m likely only going to need once or twice per year.

Jaeger said the new funding will be used to hire more engineers, grow the rental platform, and expand into new cities. RentStuff is available in most major cities, with a strong presence in San Francisco, New York City, and Nashville, Tenn., which is where the startup was founded. The money will also be used to relocate the company’s base of operations to Chicago.

In terms of generating revenue, RentStuff takes a cut from every rental transaction. But, Jaeger explained that the startup is more focused on growing the platform and generating interest than it is on profitability. RentStuff faces indirect competition from NYC-based rental service SnapGoods.

The round of funding was led by Nashville-based early-stage investment firm Solidus Company, with participation from Angel Investor Management Group and a small group of angel investors. RentStuff also received funding from startup accelerator JumpStart Foundry in 2011.

Check out a demo video from RentStuff embedded below.

Video rental service Neflix may soon see a dip in its stock value thanks to a downgrade by Barclays Capital analyst Anthony DiClemente.

Netflix had a particularly rocky 2011, with a 60 percent price hike on combined streaming-and-DVD rental plans and a failed plan of splitting Netflix into two companies. The company was punished with a loss of more than half of its stock price. The stock appeared to have rebounded slightly in the last quarter with a better-than-expected subscriber growth boost.

DiClemente cited rising costs and a number of emerging competitors as the main reasons for its lower stock rating.

“Amazon Prime’s [streaming video on demand] offering could eventually be carved out as a stand-alone product that would compete more directly with Netflix for subscribers. Likewise, Comcast’s recently announced Streampix service could eventually be offered … as another direct competitor to Netflix,” he wrote in a report published today.

It’s very unlikely that Amazon will ever spin off its streaming service into a standalone product, as VentureBeat has previously outlined. And DiClemente’s suggestion that Comcast’s Streampix could become a direct competitor would be more accurate if the service wasn’t tethered to an expensive monthly cable subscription. But, as he suggests, that could change over time.

In terms of rising costs, Netflix went from spending 12 percent of its total revenue on streaming content in 2010, to spending nearly 50 percent in 2012, DiClemente cites. If you factor in that the company is spending money on streaming licenses in two new markets (Latin America and the U.K./Ireland) in addition to its domestic and Canadian service, those costs aren’t really that big of a deal. I’d imagine if Netflix decided to launch its DVD-by-mail service in new markets, that percentage would be quite a bit lower.

“While rising digital content costs are not surprising given Netflix’s shift to a streaming-only company,” DiClemente said, “we believe Netflix’s mounting off-balance-sheet obligations add a greater level of risk to future earnings and liquidity in 2013 and beyond, which will have to be supported through continued subscriber growth.”

Another big risk for Netflix, DiClemente said, is in the company’s expansion into international markets. The company can’t afford to fail in either of its two new international markets without seeing serious repercussions on its business as a whole. Also, both the U.K. and Latin American markets already have Amazon-owned LoveFilm, which will make success even harder to achieve for Netflix.

Via THR

Netflix has taken another drastic step in distinguishing its DVD-by-mail rental business from its unlimited streaming video service.

Some customers are reporting that they are no longer able to rate and review movies and DVD shows on the main Netflix listing. Instead, they are redirected to a new page that’s set up specifically for DVDs. “As a DVD customer I’m now sent to a dvd.netflix.com subdomain that only has 3 customer reviews for a title that has hundreds on the Instant site,” wrote Reddit user myhandleonreddit in a recent submission.

We first noticed that the DVD rating/reviewing functionality was removed in the most recent update of Netflix’s iPad app. But since that app is primarily targeted at streaming subscribers, we didn’t think much of it.

The move, which doesn’t appear to be an accident, would mean that Netflix has decided to partially follow through with its unpopular plans to launch its DVD business as a separate service. Netflix originally wanted to turn the DVD side of its business into a separate entity called Qwikster, which would have its own separate site, queue, and billing. And while subscribers still have integrated billing and queues, the treatment of DVD rentals is obviously changing.

Over the last week subscribers have also noticed that searching for titles that are only available for rental as a DVD, won’t show up in the results. Instead, search results return unrelated streaming titles. For example, streaming customers that want to search for The Dark Knight can only see titles like The Dark Crystal, Knight Rider, and Beneath The Darkness. My colleague Sean Ludwig points out that Netflix does have a separate DVD tab, but you won’t see any DVD results from search unless you actually subscribe to a DVD plan.

The recommendation interaction between DVDs, unreleased titles, and streaming titles is apparently also been altered.

“If I am an Instant customer and go see The Artist in theaters and think it’s the greatest movie I’ve ever seen, I can’t go home and rate it 5 stars and begin getting recommendations for similar films that Netflix might have on Instant. Also, as a DVD customer I can no longer read any reviews that people may have written while having the Instant plan,” Reddit user myhandleonreddit notes.

We’re reaching out to Netflix for further comment about the changes, and will update the post when we hear back.

Update (10:25 a.m. PST): If you have both a streaming and a DVD subscription, you won’t notice a change. It seems that Netflix has basically put up a wall between DVD-only and streaming-only subscribers though.

Satellite television provider Dish Network has Blockbuster to thank for ending a nearly two-year drought of new subscribers, according to the company’s fourth quarter earnings report.

Dish beat analysts’ estimates by adding 22,000 new subscribers and boosting earnings to $313 million, compared to $252 million during the same period a year ago. The company’s revenue also increased to $3.63 billion or 13 percent compared to last year.

Dish purchased the ailing, bankrupt video rental company for $228 million back in April with the intent of integrating Blockbuster’s streaming and DVD-by-mail service into its television subscription business. Dish customers get a free three-month trial of the Blockbuster service, which allows them access to over 100,000 streaming videos and one physical disc rental at a time. After that it’s $10 per month added to the existing television service bill.

And while the recent quarterly earnings show the success of this strategy, Dish executives told investors it’s planning to close a third of Blockbuster’s brick-and-mortar retail store locations when their leases expire later this year. The news isn’t exactly surprising as retail stores don’t fit into Dish’s business strategy and face increased competition from RedBox’s DVD and Blu-ray rental kiosks.

Other traditional television providers are increasingly taking notice of how streaming video services are impacting their customer growth. Earlier this week, Comcast announced its own streaming video service Streampix that will be exclusively available to existing subscribers (in some cases for free). But without the well known branding that Dish’s Blockbuster service has, its uncertain if Streampix will deliver the same kind of results for Comcast.

Dish executives also discussed the company’s plans to enter the wireless internet market as a way to further diversify the business and grow revenue.  Last year, Dish made a bid to acquire wireless spectrum company TerreStar for $1.4 billion. However, the deal is still awaiting approval by the Federal Communication Commission, which should reach a verdict by March 12. Dish Chairman Charlie Ergen said the company predicts an 80 percent chance of succeeding in the wireless space if the FCC approves the deal.

Photo via trebomb

Despite nearly a year of mostly ignoring its DVD-by-mail rental side of the business, Netflix has decided to start allowing people to choose a DVD-only subscription option, the company announced on its blog today.

The option to choose a subscription package that included only DVD rentals disappeared last year as part of the company’s push toward a streaming future, and it was the first in a series of wrong turns the company made. In July, the video rental company decided to raise subscription rates by 60 percent on its combo streaming and physical DVD plans, which caused a huge uproar among its 25 million monthly subscribers. Then in September, CEO Reed Hastings announced that the company was spinning off its DVD-by-mail business into a separate company called Qwikster — a move that caused an even bigger customer backlash. After plenty of negative criticism and a significant dip to its stock price, Netflix decided to cancel its plans for Qwikster.

Netflix’s argument for wanting to get away from DVDs is mostly logical from a business perspective. The cost to ship DVDs continues to rise as does the price of the DVDs and Blu-ray discs over time due to wear and tear. Streaming, on the other hand, doesn’t have shipping costs and will eventually become the dominant form of how people watch movies and TV shows.

Of course, there are plenty of Netflix customers who don’t have access to high-speed internet, and plenty of others that actually enjoy getting DVDs due to extras like audio commentaries, deleted scenes, and more. That said, it’s incredible Netflix waited this long to give people back their DVD-only subscription option.

[Photo via Marit & Toomas Hinnosaar]

Quickflix is one of the largest streaming and physical (DVD and Blu-ray) video rental services in Australia. The company’s streaming video-on-demand subscription service is integrated into a variety of devices, such as Smart TVs, Playstation 3, Blu-ray players, and select Android-based mobile devices. Quickflix customers have access movie and television content from Sony Pictures, Warner Brothers, NBCUniversal, HBO, and others. The company reported having over 94,000 paying subscribers and $4.3 million in revenue for Q4 2011.

The investment is definitely an interesting move for HBO, which is primarily focused on its domestic content channel. HBO has 41 million global television subscribers, which the company is trying to transition into active HBO Go streaming service users. Arguably the new stake in Quickflix could signal that HBO identifies streaming services as real competitors, which it would rather own than compete against.

It’s also possible that HBO, which is wholly owned by Time Warner, is adjusting its strategy to compete against streaming video service Netflix. Over the past few months, Netflix has implemented an aggressive international expansion into the U.K., Ireland, and Latin America. HBO may have decided to get a jump on Netflix’s future international expansion plans into Australia by grabbing a stake in Quickflix.

If Quickflix’s board approves the investment, HBO will take a 15.7 percent stake in the company as well as appoint a representative to the Quickflix board.

via The Sydney Morning Herald

The video rental service will allow people to access streaming video through Verizon, while also taking advantage of Redbox’s DVD and Blu-Ray rental Kiosks. The service will definitely operate under a subscription-based pricing model, but won’t give customers the option of choosing between a separate streaming or DVD/Blu-Ray subscription package, said Verizon SVP of consumer product management Eric Bruno in an interview with VentureBeat.

“We think we bring the most value to the marketplace when we bring both together. The physical and digital distribution are stronger together than apart,” Bruno said. This sets the service apart from Netflix, which does offer streaming-only and DVD-only subscription plans. “Our expectation is that when we get this offer (Verizon/Redbox service) in the marketplace, it’s going to be highly competitive and appeal to a broad range of consumers.”

But despite the subscription package details, both companies seem adamant about taking on Netflix (as well as other competitors) on all fronts.

The new unnamed service will offer a “broad array of content that will be very competitive in the market,” Bruno said while declining to elaborate on the details of its streaming content library. It should be fairly easy for a large organization like Verizon to offer the same kinds of streaming content libraries as Hulu Plus, Blockbuster, and Amazon Prime. But, the company will have to spent a lot more money on streaming licenses to truly compete with Netflix.

I also asked Bruno specifically about the possibility of doing exclusive original programing to compete against the growing number of streaming competitors like HBO Go, Max Go, Starz, and even Netflix. “Certainly nothing is off the table,” he replied.

For Redbox, the partnership with Verizon is less about spending money on licensing deals and more about offering its customers an additional option for watching videos.

“From our perspective, we think there are some unique assets between the two companies that make this a very exciting partnership,” Redbox SVP Galen Smith told VentureBeat.

Redbox is already the leader in physical media rental sales, with over 1.5 billion disc rentals and  more than 35,400 kiosks across the country. The company also recently thwarted an attempt by Warner Brothers to delay the availability of newly released WB DVD and Blu-Ray movies, which gives Redbox an advantage over Netflix. And with the Verizon digital distribution partnership, Redbox becomes even more competitive.

The new rental service is expected to launch across the country in the later half of 2012, according to Verizon and Redbox.