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Blockbuster may shutter in face of online threat

updated 09:05 am EDT, Tue April 7, 2009

Blockbuster may Exit

Blockbuster yesterday submitted a US Securities and Exchange Commission filing that reveals the company doesn't believe it can continue business. The video store is no longer certain that it can remain a "going concern" and may have to stop operations and close its doors if its financial situation doesn't improve in the near future. The warning comes in spite of a $250 million refinancing loan having been put in place just last week; Blockbuster now says there is "no assurance" that it can meet the requirements of the transaction before it's completed on May 11th.

The company doesn't directly blame its troubles on any one factor but has long been victim of the push by direct-order rental services, particularly Netflix's DVD rental queues. It has also been hit to a smaller degree by purely online services such as Netflix's Internet streaming as well as Apple TV and VUDU Box rentals. A poor US economy has also likely contributed to Blockbuster's poor state.

The retailer has struggled to get a foothold in the digital era without much success, including the pairing of its CinemaNow video rentals with media hubs from TiVo and 2Wire. At one point, Blockbuster had considered implementing kiosks that would have let users put movies directly on iPods and other portable media players.



By Electronista Staff
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Comments

  1. psdenno

    Fresh-Faced Recruit

    Joined: May 2003

    +8

    Hopefully....

    they'll have time to distribute executive bonuses and hold a "Last Annual" all expenses paid employee beach party in Hawaii before they turn out the lights.

  1. psdenno

    Fresh-Faced Recruit

    Joined: May 2003

    -3

    Hopefully....

    they'll have time to distribute executive bonuses and hold a "Last Annual" all expenses paid employee beach party in Hawaii before they turn out the lights.

  1. climacs

    Forum Regular

    Joined: Sep 2001

    +4

    s**** 'em

    hahahaha good riddance Ballbuster Video, just like Wall Street and the music industry you pursued a short-term strategy which investors loved in the short term (s******* video renters with predatory late fees) instead of pursuing long-term initiatives to head off the coming death of the bricks-and-mortar video rental store.

    Ballbuster's attempts to compete with Netflix utterly failed. I remember getting enticed to join Blockbuster's DVD-by-mail service... epic fail. And why didn't Ballbuster pursue video kiosks like Redbox?

    Over and over again Ballbuster demonstrated that they knew there was no future for their stores yet they could not pursue alternative distribution models in a timely or competent fashion.

  1. climacs

    Forum Regular

    Joined: Sep 2001

    +5

    at one time

    one-third of Ballbuster's income came from late fees.

    That's a lot of bad will out there among former Ballbuster customers. I know I got tired of getting screwed by them and I became a Netflix customer in part to s**** Ballbuster back. Even when Ballbuster was offering really good deals for their DVD by mail service (coupons for free rentals at their stores), I preferred Netflix because they weren't Ballbuster and offered MUCH better service.

  1. climacs

    Forum Regular

    Joined: Sep 2001

    +1

    one thing though...

    when traveling in Europe I see a fair number of Blockbuster stores in major cities. I wonder how that part of their business is doing. Are Europeans deserting Blockbuster too? I don't think there is a Netflix equivalent in Europe, partly because the mail service there is a lot less reliable and partly because Europeans in general are not as web-centric as Americans are.

    Or perhaps they don't have that many stores abroad to make up for their failing US business.

  1. slapppy

    Fresh-Faced Recruit

    Joined: Mar 2008

    -5

    Blockbuster is better

    I'ts much better that Netflix. You can actually bring the envelopes to the store and get free movies back. If you exceed the 5 free allotments for that 3 movies program, you can rent the movies at a discount. I believe its 1.99. You get more movies free than Netflix.

  1. JebNY

    Fresh-Faced Recruit

    Joined: Dec 2008

    +3

    Locally Already Gone

    Last time I used Blockbuster was when they tried to lure Netflix customers in by giving free rentals if you brought in the address page from your Netflix envelope. They did it twice and I actually have a stack of pages saved just in case they were dumb enough to try a 3rd time.

    A few months ago I noticed the local store was empty. I asked when that happened at the store next door. They said a few days ago they just backed up a truck and emptied it out. Was nice of them to move in and run several nice Mom and Pop video stores out of business and then close shop. When my favorite shop closed is when I joined Netflix.

    Jeb

  1. BelugaShark

    Fresh-Faced Recruit

    Joined: Aug 2007

    +2

    yay!

    No BlockBusters = More Apple TVs

  1. boazh

    Fresh-Faced Recruit

    Joined: Jul 2004

    +5

    Let them die...

    ...a well deserve death for s******* all their customers over the years. It's pay up time!

  1. jdonahoe

    Junior Member

    Joined: Jul 2006

    +1

    Movie Stop is selling

    I was at a Movie Stop in Alabama yesterday and they were selling some DVDs from Blockbuster on their 50% off table. I guess I know where JebNY disks are going...

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