updated 04:45 am EST, Tue December 21, 2010
Expected to emerge from bankruptcy
Blockbuster plans to close another 182 stores in the next few months according to a report. The move is part of a restructure designed to return the company to profitability under the protection of Chapter 11 bankruptcy, which it filed for in September. The latest closures come after the once dominant DVD rental giant also shuttered more than 2,000 stores over the past two years.
Blockbuster’s decline and fall has been largely attributed to the rise of Netflix and Redbox vending machines. Apple’s iTunes on-demand movie rental service is also thought to have had an impact. While the company tried to adjust its strategy and move into a internet video service backed by CinemaNow, it did not have the footprint that Netflix managed to establish. It also tried a mail service, which Netflix had successfully implemented, but because it had been so heavily dependent on its retail chain it could not compete with the selection that Netflix offered.
Once the restructure is completed, Blockbuster is expected to emerge from bankruptcy sometime in 2011 led by a new consortium backed by billionaire investor Carl Icahn.