Paramount and Redbox Strike Deal

Paramount Pictures and Redbox said Tuesday that they will enter an agreement that will supply the DVD rental kiosk service with Paramount releases on a trial basis through the end of the year.

Paramount will receive detailed DVD rental reports from Redbox, which the studio will use to ascertain the worth of the program. Paramount will have the option to extend the deal through 2014, with an out clause after two years.

Under the revenue-sharing deal, Redbox estimates that it could pay Paramount around $575 million if the deal is extended to the full term, the AP reports. Redbox has also agreed to destroy Paramount DVDs it removes from its rental kiosks.

Studios Sony and Lions Gate have formal deals with Redbox. However Fox, Warner Bros., and Universal have all made attempts to keep the rental company from offering their new releases for a set period of time, and are now facing lawsuits.