The red DVD kiosks that once popped up in Walgreens stores across the country may be coming to an end.
Last week, media company Chicken Soup for the Soul Entertainment, which owns Redbox, announced, Chapter 11 bankruptcy filedCourt filings revealed that the company has $970 million in debt, compared with just $414 million in total assets. Creditors seeking repayment from Chicken Soup include media giants Universal Studios, Sony Pictures and BBC Studios Americas, as well as retailers Walgreens and Walmart.
Redbox didn’t seem like a good deal for Chicken Soup, which received $325 million to buy the DVD rental chain from Apollo Global Management in 2022. Since then, the company has been hit with lawsuits from CVS, Sheetz, NBCUniversal, 828 Media Capital, and Several other sellers The company is seeking compensation for unpaid franchise fees and commission fees, among other grievances. It now owes its employees $3.52 million in unpaid wages and $2.24 million in health and welfare benefits, after failing to pay them since early June.
The collapse of Redbox not only reflects widespread mismanagement; it also illustrates the collapse of the DVD. Kiosks are essentially the last vestiges of an earlier era of technology. In 2010, Blockbuster, Redbox’s DVD-by-mail counterpart, filed for bankruptcy. In 2007, Netflix launched its streaming service, revolutionizing the video-watching market.
Overall, DVD sales have declined significantly in recent years. In 2023, DVD purchases were decreased by 92% Since the industry’s peak nearly two decades ago, DVDs made up 64% of the home video market. Now, that statistic is at just 10% of the total home video market. Less than 10%The population’s appetite for DVDs also points to the technology’s demise. While one might expect older people to be interested in watching DVDs, a recent study shows that a significant number of older people are now interested in watching DVDs. Statista Report The study found that people between the ages of 18 and 29 were the ones who bought DVDs and Blu-ray discs at the highest rate.
At best, DVDs have become the next craze for vinyl, a nostalgic piece of media to be collected and displayed. At worst, they are being dumped into landfills around the world.
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