Coinstar, Inc. (NASDAQ: CSTR) is surging this morning on news that it will get to compete even more with Netflix, Inc. (NASDAQ: NFLX). The operator of box DVD rentals has formed a joint venture with Verizon Communications, Inc. (NYSE: VZ) for streaming video.
The move will allow Coinstar to look a bit more like Netflix as far as a physical video rental and a streaming video model. This supposedly comes with all of the convenience, simplicity and value of Redbox.
A subscription service will launch in the second half of 2012 and the brand and product information will be revealed in the coming months.
The offerings will be instantly available online and mobile content with immediate access to physical media through rental kiosks. The joint venture is a limited liability company with Verizon holding a 65 percent ownership share and Redbox holding a 35 percent ownership share at the outset.
Coinstar shares are up 6.5% at $53.00 against a 52-week range of $37.43 to $60.71; Netflix is down 3.4% at $122.10 against a 52-week range of $74.25 to $304.79.
JON C. OGG