Netflix, Inc. (NFLX), Amazon.com, Inc. (AMZN): Is Original Programming the Key to Online Streaming?

Redbox steps in

With its Redbox Instant program, Coinstar, Inc. (NASDAQ:CSTR)‘s Redbox is hopeful that it will be able to gain some of those online streaming customers to its service. Redbox has reportedly been investigating online programming opportunities with its online streaming partner Verizon.

Redbox is currently preparing to launch its online streaming program, so, it’s hard to say what the service will do for the company known for providing bargain-priced DVD rentals in small boxes positioned around the country. In anticipation of the release of the service, Coinstar, Inc. (NASDAQ:CSTR)’s stock rose slightly, but revenue growth for the company has been sluggish, leading analysts to wonder if the streaming service is too little, too late.

Since Redbox is responsible for a vast majority of Coinstar’s revenue, investors keep a close watch on the movie rental service’s performance. Original content or not, Coinstar does offer something Netflix doesn’t: for $8 a month, customers will have access to online streaming and four free DVD rentals a month. Still, if Redbox doesn’t bring the content, customers will stick with the sites that do.

Will original programming like House of Cards make the difference? It’s hard to say. Netflix shelled out $100 million for the first two seasons of the series — money that it has already recouped. But will Coinstar and Amazon be willing to pay the same? Without original programming, success will go to the company that can win the best licensing rights, and that’s a war Netflix seems to already be winning.

The article Is Original Programming the Key to Online Streaming? originally appeared on Fool.com and is written by Stephanie Faris.

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