Why is Coinstar the Only Company that Understands the Value of DVDs?

Streaming video may be the future, but most companies have forgotten that we are living in the present.

As most Benzinga readers are now aware, Verizon

and Coinstar

have

the nation's video rental service: Netflix

. In addition to this headline-grabbing announcement, Redbox (Coinstar's DVD kiosk rental service) quietly announced that it will acquire more than 10,000 Blockbuster Express DVD kiosks from NCR

. According to

(via

), Redbox is paying $100 million for the kiosks. This fee will sort of make up for the $60 million operating loss NCR expected to incur during the fiscal year. Why is NCR, a company that focuses on ATMs and other self-service machines, in possession of Blockbuster's ill-fated kiosks? For some reason or other, Dish Network

didn't want them. It wanted the Blockbuster name, select Blockbuster retail locations, and who knows what else. But the kiosks were of no use to the satellite service provider, allowing NCR to snatch them up. Coinstar will surely rebrand the kiosks and transform them into Redbox machines, allowing the company to expand its customer reach. As costly as this acquisition may be, it could prove to be one of Coinstar's smartest investments. Netflix has no interest in the DVD business. It might

renting DVDs than streaming video, but the company would rather drive its business into the ground using new technology than turn a profit using digital video discs. To make matters worse, most traditional video rental shops have closed. Blockbuster may have looked hopeful when Dish Network announced that it wanted to acquire the firm, but what has it done since that time? With the inevitable demise of DVD renters – but not DVDs – Coinstar could end up with a default monopoly on the market, and earn all of the profits that its competitors foolishly sent away.