Okay kids, gather around. We have a story to tell, one that you might not believe, but stick with us. Once upon a time, streaming services did not exist. If people wanted to watch a movie at home, they had to wait for networks to choose to show it. Then, some clever companies decided to create movie rental stores. They offered a better option, but it still involved a tedious process. Consumers had to drive to the video store and search through the shelves to find a movie to rent, and they simply had to hope that the most popular titles were still in stock. (We won’t even go into the evolution of different video formats available in the stores here, but it’s a pretty interesting story too!)

Then, a new idea arose in 2002, seeking to address the pain of visiting a separate video store. Redbox came up with the revolutionary notion of installing DVD vending machines in existing stores, such as supermarkets, pharmacies, or convenience stores. Thus, consumers already out and about, shopping for daily necessities, could grab a movie on the same trip, then return it to the same convenient location. The vending machines could hold up to 600 discs and did not require any regular staffing, and people could keep the movies as long as they wanted (for a fee). Redbox eventually boasted nearly 25,000 machines installed throughout the United States.

The idea might have been revolutionary at the time, and it signaled the company’s innovative ability to address a problem that only had emerged as the market changed. Yet despite this history, Redbox failed to adapt as video viewing habits and capabilities continued to shift. Thus, by 2024, the company had entered bankruptcy, which was frustrating for investors and employees. But that isn’t the only difficulty.

Its bankruptcy means that all those tens of thousands of vending machines, installed in stores across the United States, are useless. Each box weighs nearly 900 pounds. They are bolted into concrete foundations at each location, and they rely on the host stores’ electricity. Walgreens estimates that it has spent $184,000 per month, across 3,800 locations, to power Redbox machines linked to its existing grids, even though the boxes no longer function as intended.

In addition to the physical challenge of removing the Redboxes, the responsibility for doing so is not straightforward. Both Redbox and the operators that it contracted with to maintain the kiosks have left the market, completely out of business. Thus, there is no corporate entity that stores can contact to deal with the machines. Instead, the retailers need to get permission from the courts to have the Redbox machines disconnected and removed. Once they gain the approval, they have to find a way to remove the machines in an environmentally safe way; each Redbox was designed to contain coolant material that would be corrosive if disposed of incorrectly.

Thus a new market has emerged, and some specialized moving companies have begun touting their ability to handle the removal process for the retailers—pending court approval, of course. But solving the removal problem still leaves open the question of what happens to the removed machines. Most of them likely will end up as scrap metal, because the intricate processes that would be required to salvage, retrofit, and store the machines are intense and expensive. A few enthusiastic collectors have struck deals with stores or salvage contractors, in their bid to own a piece of media history, but that niche market is much too small to make a real dent in the supply of defunct Redboxes.

Discussion Questions

1. Ideally, which actor in this supply chain should be responsible for removing the Redbox machines? Does your answer match the reality?
2. Can you imagine any other creative reverse logistics solution for dealing with the defunct kiosks?

Sources: Becky Yerak, “Bankruptcy Took Down the Redbox Machine. If Only Someone Could Take Them Away,” The Wall Street Journal, October 10, 2024; “Companies Weighing How to Delete Now-Defunct Redbox’s DVD Vending Machines,” ABC News, October 11, 2024; Trevor Mogg, “Redbox Kiosks Are Disappearing, But Where Are They Ending Up?” Yahoo! Tech, October 15, 2024