Coinstar Inc.may see a bump in customers

Coinstar Inc., which operates DVD-rental kiosk company Redbox, may see a bump in customers if Netflix Inc. subscribers cancel their accounts over newly announced higher prices, an analyst said.

THE SPARK: On Tuesday, online movie rental company Netflix said it was increasing the price of its combined DVD and movie streaming subscription plan by 60 percent. Netflix also said customers can choose to subscribe to a DVD-only plan or a streaming-only plan.

Netflix subscribers to the combined service may find the price increase too expensive and cancel their subscriptions, Merriman Capital analyst Eric Wold said in a research note. He added that those customers could start using Redbox, where DVDs cost $1 a night to rent.

Redbox has more than 27,000 automated kiosks in grocery and convenience stores around the country.

THE BACKGROUND: Netflix customers were quickly offered feedback through the company's Facebook page, flooding it with over 42,000 comments, 98 percent of them negative. "While it's a known fact that consumers are more likely to comment negatively than positively, we believe this level of complaints is worth noting," Wold said in a research note.

THE ANALYSIS: "We continue to believe Redbox now has an opportunistic (and clearer) growth runway ahead of it," said Wold. He also said that any loss of subscribers won't affect Netflix much, adding that the price hike was a "smart move by management to better monetize both sets of content."

SHARE ACTION: Coinstar shares rose $1.42, or 2.5 percent, to close at 58.80 Wednesday. Netflix shares rose $7.46, or 2.6 percent, to close at $298.73