Redbox is starting to sell live event tickets from its kiosks in Philadelphia. (George Frey )
After successfully challenging established players Blockbuster and Netflix in the DVD business, Redbox is now going to attempt to rival one of the nation's most powerful companies: Ticketmaster.
The operator of 38,500 kiosks in grocery stores, drug stores and Wal-Marts across the country launched a ticketing business Wednesday with Philadelphia as its first test market. Its second market will be Los Angeles, where the company plans to enter the ticketing business in early 2013.
Redbox's major selling point: a service fee of only $1 per ticket, compared with the $10 to $15 that Ticketmaster often charges on top of the ticket's face value.
Consumers can buy tickets from Philadelphia-area Redbox kiosks or online and then print them out or pick them up at a venue.
"We have credibility as an entertainment brand and feel like we are a great source of discovery," said Redbox President Anne Saunders, adding that the Illinois-based company emails 43 million customers regularly.
The initial offering is limited, with tickets offered for a Carrie Underwood concert on Nov. 28, a film festival later in the month, and several NASCAR events next summer. But the company promised to add more events shortly.
Ticketmaster and smaller competitors already have exclusive contracts with many of the most popular concert locations. But Redbox sees broader opportunity in selling tickets to museums, fairs, small concerts and other events in communities.
"The majority of what we are going to focus on is the broad live event marketplace, but we will also be doing our fair share of concerts and sports," said Mark Achler, senior vice president of new business, innovation and strategy. "We're talking to all the major national players [in live events.]"
The ticketing initiative is a way for Redbox to grow its revenue without installing new kiosks -- a difficult task given its already broad coverage of the entire U.S. -- or putting new products into machines already packed full of DVDs and video games.
After L.A., Redbox is looking to expand to other cities quickly. "I see no reason this can't be everywhere we are," said Saunders.
MPAA's Chris Dodd extends olive branch to Silicon Valley
Cable group says TV sports rights deals are out of control
Bootleg music downloading a thing of the past? Not so, study says
INTERACTIVE: TVs highest paid starts
QUIZ: Celebrity voice overs
PHOTOS: Hollywood back lot moments