HOUSTON - You've probably seen those big red boxes, usually outside the McDonald's or the Walgreens or inside the grocery store.

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May 14, 2009

They look like a Coke machine, and they work about the same.

But they're not dispensing sodas - they're dispensing major movies on the cheap.

They are Redbox movie rental vending machines, and they are gaining popularity at a rapid pace among movie watchers. We saw a steady stream of users in the short time we were at a machine in River Oaks.

Redbox requires a credit or debit card. That's it. You just walk up to the big red box and start renting DVDs. No online registration is required, however if you set up an account online, you can reserve movies that you plan to pick up at a particular machine.

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The DVDs come out of the machine and go right back in it when you are done. You can return them to any Redbox, regardless of the one you rented from.

These dollar-a-day rentals are giving the big boys a run for their money as more people are "Saving Cents" on their entertainment budget. Blockbuster, for instance, is now advertising the online purchase of four movies for $20 to remain competitive. But will it work?

"(Redbox is) cheaper than, you know, the $4 or $5 at Blockbuster. (That's) always important, I mean, everybody's gonna go for the cheapest, especially if it's the most convenient," said Stacey Efaw, a frequent Redbox customer.

According to business reports, a typical Redbox takes in about $50,000 a year.

But most of us don't qualify to be franchise owners. According the company's Web site, you must be a business owner who serves at least 15,000 customers a week to qualify as a franchisee.

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