Digiboo: Redbox's next biggest rival?

The Santa Monica, Calif.-based company Digiboo has kiosks that let users download movies via flash drive. Could Digiboo usurp Redbox's throne?

It’s hard to enter a supermarket, pharmacy, or convenience store without seeing a Redbox kiosk. Each one is coated in lipstick red and harbors hundreds of DVDs and video games, all for the price of $2 or less per day. These kiosks contributed to the demise of Blockbuster, onetime video rental king. But soon, Redbox could be undermined by another – digital – entertainment company.

Digiboo, whose slogan is “movies on the move,” is setting up kiosks in only three airports to start, according to Engadget. Instead of giving users discs, Digiboo lets you put movies on USB flash drives and download them to your computer in minutes or seconds. So can the 100 percent digital technology of Digiboo send disc-reliant Redbox down the same chute that Redbox sent Blockbuster?

One reason it could is that the DVD space is looking tired. Google searches for DVDs have tapered off, while searches for on-demand services such as Netflix have “skyrocketed,” PCWorld reports. While Digiboo isn’t on-demand – it does require you to go to the actual kiosk and insert the flash drive into your PC – it’s a step in the right direction. Also, DVDs are less reliable than data files, plus, they require good care. After Digiboo users order movies and install them on their computers, the only thing they have to worry about it not destroying their laptops.

Finally, Redbox users have to return discs at 9 p.m. the day after their rentals, while Digiboo lets you hold onto your purchase for 30 days (once you start playing a rented movie, for instance, you have 48 hours before it expires).

However, at this point in its early existence, Digiboo faces its own hurdles. It charges $3.99 to rent a movie – on par with iTunes but twice the Redbox rate – and $14.99 to purchase one. Its movies are all standard definition, because the company has not been able to license high-definition movies from studios, according to the LA Times. Digiboo is also only compatible with PCs, not Macs, although Windows utilities on Macs will play files.

As Digiboo gains ground and sets up more kiosks across the country, it’s likely that these quirks will be addressed. In the meantime, Redbox has the advantage in terms of viewing experience and compatibility. And who knows? Redbox itself may begin to transition to a digital download technology.

Critics of kiosk-based companies may wonder how it’s possible to beat the convenience of a Netflix, which doesn’t require more than the click of a mouse or a touch of a tablet. The answer lies in Digiboo and Redbox’s one-payment, one-viewing system. Users aren’t obligated to sign a contract with kiosks, since they are available to use only once, twice, or tens of times.

Digiboo may spark an industry-wide transition to on-the-go downloadable movies.

For more tech news, follow us on Twitter @venturenaut. And don’t forget to sign up for the weekly BizTech newsletter.