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Redbox price increase: Will it stir backlash, too?

Redbox price increase, which begins Monday, will raise standard DVD rental from $1 to $1.20 a day. The Redbox price increase risks a consumer backlash similar to the one against Netflix.

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As an indication that more people may have been renting from Redbox for the first time, Davis told The Associated Press that the number of unique credit cards used at the kiosks in July through September increased by 8 percent from the previous quarter.

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By Coinstar's reckoning, Redbox surpassed the market share of Netflix's DVD-by-mail service for the first time during the third quarter. Coinstar said it ended September with a U.S. market share of nearly 35 percent compared to 33 percent for Netflix and other DVD-by-mail services. A year ago, Coinstar pegged its market share at 24 percent with Netflix and other DVD-by-mail services at nearly 36 percent.

Netflix expects the shift to continue as it focuses more on its video streaming service. Netflix predicted it may end December with 10.3 million DVD subscribers, down 25 percent, or 3.6 million, from the end of September.

"We always try to roll out the red carpet for customers who may feel disenfranchised," Davis said during an interview with the AP.

With another potential influx of former Netflix subscribers looming, Coinstar expects its revenue to rise as high as $510 million in the fourth quarter. But the company doesn't expect to make as much money in the holiday season as it did in the third quarter because a slew of year-end DVD releases of popular movies will drive up its expenses. Coinstar predicted its fourth-quarter earnings will range from 57 cents per share to 67 cents per share.

Analysts had projected fourth-quarter earnings of 78 cents per share on revenue of $483 million.

Coinstar's shares fell $5.30 to $47.65 in extended trading after the results were released. If the sell-off holds in Friday's regular trading, it will wipe out most of the gains Coinstar's stock has made since Netflix raised its prices.