Verizon, Redbox to launch streaming video

Phone company Verizon Communications Inc. will challenge Netflix and start a video streaming service this year with Redbox and its DVD rental kiosks.

Verizon and Coinstar Inc., Redbox's parent company, said Monday that the service will be national and available to non-Verizon customers as well. The proposed venture adds another dimension to Verizon's quest to become a force in home entertainment, and may compete to some extent with the cable-TV services Verizon already sells.

Unlike competing services from Amazon.com Inc. and Wal-Mart Stores Inc., the new service will combine Internet delivery of movies with DVDs, the way Netflix does. Dish Network Corp. also offers a similar bundle through its Blockbuster subsidiary.

Details and pricing of the new plan weren't announced.

Redbox, whose DVD rental kiosks are located in more than 29,000 stores, has been looking to expand into online streaming for more than a year. Its business so far has revolved around renting DVDs for as little as $1.20 per day.

With the Redbox venture, Verizon is breaking ranks with the cable and satellite industry, which makes its own video streaming services available only to people who also subscribe to its traditional TV feeds. Verizon and Coinstar said the service is intended to give subscribers access to DVD and Blu-ray discs as well as streaming movies starting in the second half of the year. Subscribers might visit the site to find that the movie they want isn't available for streaming, but is available at a Redbox kiosk nearby, said Paul Davis, the chief executive of Coinstar.