Redbox pulling movie kiosks from Canada

DVD and Blu-ray rental company Redbox is shutting down its Canadian operations and pulling its rental kiosks out of Canada.

Chicago-based Redbox announced Thursday that it made the decision after failing to generate sufficient business at its 1,400 rental kiosks across the country.

In a telephone interview from Los Angeles, company president Mark Horak said the last date for rentals will be Feb. 13, with the last return date on March 5.

Most of the kiosks and their contents are expected to be removed and returned to the United States by the end of March.

Asked how many employees and contractors would be affected by the shutdown, Horak would say only ``very few.''

Redbox landed in Canada in mid-2012 and set up most of its machines at grocery and convenience stores.

In July 2013, Redbox struck a partnership with Sobeys to place its kiosks at various of the supermarket chain's banners, including Sobeys, Foodland, FreshCo, Lawtons Drugs and Needs.

Redbox's owner Outerwall Inc., which specializes in automated retail products and services, announced in its earnings results that it had taken a US$1.5-million charge on its fourth-quarter results as a result of the shutdown. The remaining value of the content library and capitalized install costs are to be amortized over an expected three-month wind-down period.

Physical media has been declining in popularity for several years as more viewers turn to streaming video and video-on-demand options.

Last summer, Canadian DVD rental company Zip.ca shut down its Ottawa-based DVD-by-mail operation and removed its rental kiosks from grocery stores in parts of the country.