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Redbox Owner Chicken Soup For the Soul Files For Chapter 11 Bankruptcy Protection (apnews.com) 26

Posted by BeauHD from the sign-of-the-times dept.
Chicken Soup for the Soul Entertainment, the parent of DVD rental operator Redbox, has filed for Chapter 11 bankruptcy protection after months of financial struggles and piling unpaid bills. The Associated Press reports: Chicken Soup for the Soul has accumulated nearly $1 billion in debt, the Chapter 11 filing submitted Friday in Delaware bankruptcy court shows, after reporting loss after loss over recent quarters. The filing also discloses that Chicken Soup for the Soul owes millions to over 500 creditors -- which range from big names in the entertainment world like Sony Pictures and Warner Bros, to major retailers like Walgreens and Walmart. As of March of this year, Friday's filing shows, Chicken Soup for the Soul had about $414 million in assets and $970 million in debts. Shares for the public company have fallen more than 90% over the last year. "Redbox, founded in 2002, is best known for red-colored, self-serve machines that sit outside of pharmacies or groceries stores to rent or sell DVDs," notes the report. It was acquired by Chicken Soup for the Soul in 2022. There are currently about 27,000 Redbox kiosks across the U.S. -- down from 36,000 at the Redbox acquisition was finalized in August 2022.
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Redbox Owner Chicken Soup For the Soul Files For Chapter 11 Bankruptcy Protection More

Redbox Owner Chicken Soup For the Soul Files For Chapter 11 Bankruptcy Protection

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  • Both were in debt (Score:3)

    by DrMrLordX ( 559371 ) on Monday July 01, 2024 @03:16PM (#64592987)

    Redbox was carrying $325 million in debt with Chicken Soup for the Soul picked them up in 2022. They had their own debt/revenue problem at the time. Two sinking ships lashed together just makes a bigger, faster-sinking ship.

    Seems like Redbox would've been better off on its own.

    • Redbox's core market seem to be people that didn't have access to better alternatives. Mostly people whose internet connection couldn't handle streaming. It's not like those people went away and it seems strange that they would struggle. I could see the business shrinking some because if you're in a major city streaming is going to squeeze you out. But if you're in the middle of nowhere like a lot of people are I could see people driving half an hour into town to the Walmart and using the red box. Heck I'm

      • fucked up supply (Score:1)

        by Anonymous Coward
        They signed agreements with Hollywood studies to get the DVDs, so naturally the studios did what they could to screw over Redbox. Mr. Walt Disney could tell you what happens when you cut deals with Hollywood studios.

      • We have a Redbox at Winco in Humboldt. I presume it's there so that people whose internet has been turned off can still watch something.

  • If they're feeling bad (Score:3)

    by Compaq Disk Rereader ( 10425332 ) on Monday July 01, 2024 @03:22PM (#64593005) Journal

    I have a book "Chicken Soup for the aspiring Media Conglomerate"
    A collection of made up anecdotes and cute stories where the power of hope carries a troubled C-suite to a Jesus inspired happy ending.

    Chapter 1 : Heavens Gate
    Chapter 2: Star Wars Christmas Special
    Chapter 3: Blockbuster ....

    Chapter 11 : You

  • The strangest part of this story is finding out that Redbox was owned by Chicken Soup for the Soul. It's like finding out that The Year 1992 wanted to be hip and relevant, and so they bought The Year 1987, which at the time was pretending to be The Year 2008 by way of a comb-over a prominently displayed digi-pet.
  • On the other hard, this might mean more sell-off of used DVDs.

    • Re: (Score:1)

      by toddz ( 697874 )
      How much revenue could that generate at discount DVD sale prices? Redbox already sells used DVDs for 3.99 USD. So if no one is motivated at that price what good is it to drop it to $1.99 and maybe loose even more money on paper. Note: I'm assuming that dropping the sale price below the rental price is bad business.
      • That sounds like a good option for someone like me who eschews the streaming services. However, I feel the quality and content of modern TV and film offerings is too low to bother with. I've become more active and have almost no time for such things, now.
        • You can't be 'active' 100% of your waking hours, everyone needs downtime. Don't tell me you're just reading books either.
          • Okay, I won't tell you that I'm coding, listening to music, and just reading books and it's working much better for me than TV.

  • If you're not growing you're failing, so we better constantly expand and buy out other things. Making money isn't good enough.

  • Rebox tried to buy Netflix DVD Bussiness (Score:4, Informative)

    by williamyf ( 227051 ) on Monday July 01, 2024 @05:19PM (#64593291)

    When Netflix was winding down their DVD/BD-by-mail service (late april 2023), Redbox wanted to buy it. But Netflix would not budge.

    https://entertainment.slashdot... [slashdot.org]

    It was a good idea (for Redbox) then *, and probably they could have found the financing to do it.
    But Alas, ALL of Netflix's Disk-by-mail people lost their jobs, and now the Redbox people are at risk of losing theirs too.

    And again, is "Chicken Soup for the Soul" media the one in chapter 11, not Redbox alone. Maybe is the print biook division the one in trouble, or Crackle (they own Cracle too).
    Heard of Crackle trying to go against all other free streaming with advertising businesses? Yeah, tought so.

    When the chapter 11 plans are published (or when the company goes to chapter 7 and is dismembered) we will know which division were doing OK (if any), and which divisions dragged down the company the fastest.

    * Why? Glad you ask. Among others:
    1.) More negotiation power leads to less licencing costs to be paid to holly/bolly-wood studios.
    2.) A review of all the distribution/operation centers leads to closure of some of them, leading to a more efficient supply chain, leading to less expenses and faster service.
    3.) Ditto for redundant personnel.
    4.) Redbox had two main revenue sources (DVD rentals by kiosk + Used DVD sales), this brings another (DVD by mail).
    5.) The customer data from Netflix leads to a bigger customer DB, with retention and cross-selling opportunities (and that favors the Cracled streaming service too).

  • Anyone can set up a bunch of vending machines and buy some DVDs and Blu-rays in order to re-implement Redbox at a smaller scale in the handful of locations this sort of thing can be profitable, so no great technology is being lost here. I mean, some locations still have video rental stores.
  • Yes, quotation marks of some sort are useful. Even if they may be tricky to deal with from a software point if view.
    • Use less crappy programming languages that can properly differentiate between literals and the content of variables.

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