updated 03:20 pm EST, Thu November 8, 2007
Blockbuster Digital Kiosks
Blockbuster is considering opening download stations as a way of shoring up its failing rental business, according to company chief Jim Keyes. The executive says that the company will launch an experiment which brings kiosks which could download movies directly to a portable media player, bypassing the need for a DVD or for transferring videos from a computer. The stations will appear at Blockbuster's own stores and may also branch out into malls and other areas where the chain typically does not operate.
The video formats and price strategy for movies offered this way have not been revealed, though Blockbuster intends to roll out test versions "aggressively" by early 2008, Keyes says. Other digital options being considered to revitalize the business include integrating Blockbuster's MovieLink direct-download movie service with Blockbuster and offering other digital services in the physical stores, such as an interactive children area or PlayStation 3 demo booths.
The effort has been characterized as an attempt to fend off both online services that mail video rentals, such as Netflix, as well as stores that offer both permanent and rental downloads, such as Apple's iTunes Store or Amazon Unbox. The relatively high price of physical copies of movies and limitations in stock have reportedly driven customers to Blockbuster's competitors.
Keyes specifically holds up Apple as an example of how to make the most of retail space. Though he does not draw a direct connection between Apple's portable music player business and video rentals, he explains that the willingness to try a significantly approach to retail outlets could prove useful for Blockbuster, which has typically been conservative.
"I get excited about what we could do with what is some of the most choice real estate," he claims.