fujishig

I don't understand how they could've been more aggressive (I do agree with your point that they were slow to roll it out). What more did you expect? They offered pretty much the same service as Netflix, except played to their strengths with the availability of the "blockbuster" titles on release. They did a big marketing blitz, including Superbowl commercials. They added HD-DVD and Blu. They tried to integrate it with their one big advantage, their stores, with the in-store exchanges (and before that, with the free rental coupons). The last one, I think, lost them a ton of money. They allowed you to return dvds in their stores for quicker return times.

Now, they got progressively worse as they started bleeding money, and management started seeing it as a drain instead of an asset. They raised prices to try to stay profitable. The last change with the in-store movies counting against your queue was the final nail in the coffin for me as a subscriber.

UAIOE

I'd never seen their big marketing blitz aside from the typical random commercial, so that is what led me to believe they didn't do enough.

But considering they are where they are now, something didn't work.

Goat3001

I hope you enjoy it when Netflix raises prices! Netflix already knows that BB is in trouble so what have they done already? Started charging MORE for Blu-Ray service that Blockbuster offered at no additional charge.

How do people not understand that competition is a GOOD thing for consumers? Blockbuster leaving isn't good for ANYONE.

JoeySeven

Heres a little article on Blockbusters.


Reports of Blockbuster's death are (somewhat) exaggerated
Jonathan Berr
Apr 7th 2009 at 1:00PMText SizeAAAFiled under: Company News, Columns
Blockbuster Inc. (BBI) has gone through more lives than most cats. It reinvents itself more often than Madonna and is viewed by some as more washed up than Mickey Rourke before "The Wrestler." Yet despite everything from Netflix Inc. (NFLX) to cable on-demand services to 99-cent rental services, it has survived. And the Dallas-based company is likely to survive a "going concern" letter in its 10-K which is causing its shares to tank.

Granted, the skepticism about the Dallas-based firm has some justification. It lost $374.1 million last year as the economy tumbled. Blockbuster has also made some bone-headed decisions, including a disastrous move to end late fees a few years ago that cost the company dearly. As of January, Blockbuster had 4,585 stores -- many of which seem gargantuan. That number seems way too high, particularly for a business that's migrating to the internet.

Last month, the company amended its $250 million credit facility, which had been reduced from $350 million. That deal has yet to close. The company generated a paltry $51 million in cash from operations. That's what prompted the statement from PricewaterhouseCoopers LLP about Blockbuster's ability to continue as a "going concern."

"The risk that we may not successfully complete this refinancing and obtain the related amendment of certain financial covenants included therein, and/or the risk that we may not have adequate liquidity to fund our operations as a result of not meeting our projected financial results, even if the refinancing is completed within the time and upon the terms contemplated, raise substantial doubt about our ability to continue as a going concern," according to the 10-K.

Even if it closes on the deal, the loan agreement would require that most of Blockbuster's cash flow from operations be used for debt service payments.

But like Cher, Rourke and Madonna, Blockbuster is a survivor. The company will endure -- even if in a much smaller incarnation -- because renting DVDs makes too much sense economically. I mean, how many times does anyone want to watch the '70s drama "Emergency" in reruns?

-------------------------------------

Heres whats going on in my city with instore rentals.

-Mom and Pop DVD rental store went out of business over a year ago,maybe two.Never went their as I'm new to this town that I live in.
Loction was about 1 mile from BB and Hollywood Video.

TheMadMonk

Last time I was in a Blockbuster store was in '97 or '98. I asked where their dvd section was. They said they didn't have one, and had no plans to carry dvds. I haven't been back since. Good riddance.

Trevor

I agree, and shake my head in wonder every time someone makes a "good riddance" comment.

It is a bad thing for everyone (except Hollywood Video) if Blockbuster goes under.

Goat3001

Yeah, I think this is BB's biggest problem. The fact that they haven't been able to catch up with the times. DVD has been the medium for a decade now and Blockbuster still refuses to carry anything but VHS. No wonder they're getting driven out of town.

JustinCleveland

You asked about about a burgeoning format in its earliest infancy, were turned down, and then spent 12 years harboring a grudge? If you had asked me in 1997 if I planned on buying a DVD player I would have said that I was waiting, too, because I didn't want to invest in a technology that would be obsolete in a couple years, a la Laserdisc.

I don't care if you don't like a company--having it go out of business is not a good thing for workers, consumers, or the economy as a whole.

UAIOE

Well, where I'm at there are *TWO* Blockbuster stores in this area and two "Family Video" stores, a lone "Hollywood", a few grocery stores with in-store video rental, and a handful more grocery stores/Wal-Mart's that have those Redbox-ish rental machines.

On top of having access to Netflix. I'd say that competition here is alright.

I understand that my local situation isn't indicative of the country at a whole, but this is why *I* don't see a problem if BB goes south here.

ilovedealsbaby

who even still rents any more i know in canada its 5$ to rent a movie for a day 12$ for ps3 game at block buster for 5$ more you can buy the movie own it or resell it to make the difference back its not worth it even if you go in and buy a used movie its 20$ in canada and you can buy it brand new at walmart for 4.88 no wounder they dont make money all the stores that used to sell movies in super markets ands tuff closed 10 years ago people just dont rent here they justbuy movies more easy and cheaper or buy them off ebay and blu rays stores here cary like 10 its not even worth it rambo is like 10$ a day to rent i got the rambo box sets on amazon for 14$ for 3 movies to keep

they should get into a renting and selling at cheaper prices store to sell like best buy since most people if they like a movie just pick it up to own it

stingermck

we have 5 Blockbusters here, 2 Hollywood videos, 1 movie gallery, and redbox everywhere, and a Moviestop if you want to get your buy on.

Heat

It's good for Netflix.

And for what it's worth, here (town of 115,000) we have probably 9 Family Videos, no Blockbusters, and a couple Hollywood Videos (though one is struggling). Of course, this is the town where Family Video got started.

Goat3001

Conversely, on the parts of Long Island that I frequent there is a plethora of Blockbusters, there was one HV near where I worked but it shut down and I've never heard of Family Video. Redboxes are everywhere.

I still stand by my point. The more competition, the better for consumers.

atlantamoi

Are periods taxed in Canada?

Seriously? That's weird.

Goldblum

NO MORE LATE FEES

(because no more blockbuster)

Cheato

Took me a minute, but...

Trevor

I had to read it twice. Good one atlantamoi. I think I have a Blockbuster giftcard at home, better find it quick.

calhoun07

From this week's Home Media Magazine, a industry news magazine. Pretty much more of the same already being said, just adding some dollar amounts to the dire situation for the company.



It's not so much the stores are performing badly...most of their stores across the board are up. They just over extended their credit for far too long and it's time to pay up or shut up, apparently.

Many of you may glee in their demise, but it's sad that the employees have to suffer, seeing that the people running the stores from store manager down seem to be making money for the company that is in turn mishandling that cash and putting their jobs in serious jeopardy.

Tarantino

Eh...fuck 'em.

= J

Condensed

Damn, I actually enjoy my monthly blockbuster plan.

riobingo

I think they got left behind by people like Netflix. Once they destroyed all the small local video stores they just sat back and didnt go with the new dvd by post ideas.

Forbes2

Everyone should hope that Blockbuster remains viable. Netflix will have a blank check to raise pricing if Blockbuster quits this business. I am signed with Blockbuster and am doing ok, I like being able to go in the stores and exchange an envelope for a rental movie that might be on availability delay with the by-mail program. I can usually get it back right away so that I don't suffer any turnaround time. The in-store exchanges are in addition to the X-discs-per-time mailer program. I'm surprised more Netflix people don't switch to Blockbuster. I generally can get two full cycles per week per disc.

Forbes2

This is kinda dumb. The Blockbuster locations I've seen don't have any VHS whatsoever, it's all DVD and Blu Ray, plus the game rentals. So it's clear to me this person would rather rant and perpetuate bad rumors than go check out the facts.

whotony

you seriously don't know goat was sarcastically
replying to another previous dumb post

calhoun07

From this week's Video Business Magazine...

The bank debit they owe is one thing. It's been estimated in some inside circles that the debt owed to the major studios could be three quarters of a million dollars alone. So even if they pay off the banks, if the studios get pissed enough and stop sending them movies (and the major studios have cut back sending them a lot of copies of new movies all together) then what good will the paid bank loan be when you can't get the rentals in to satisfy the customers?

And, not surprisingly, the company sent out a memo to all employees stating they will no longer match 401K. I personally think the most surprising aspect of that is that they HAVE been matching up until now.

The only silver lining that I can possibly see in all of this is, compared to Circuit City, Blockbuster stores have steadily made money and the majority of their stores are up this year. Even when Wal-Mart is struggling to make money, Blockbuster stores are making money. Granted, that doesn't help with Corporate squanders the money away and doesn't pay loans off and debt to the movie companies, but it's not a Circuit City situation where even the stores are hemorrhaging cash. Taking that into consideration, I would be surprised if the corporation that manages Blockbuster survives this year but I'd be even more shocked if the stores themselves sank with the ship...I would imagine an investor would see the profitability of the stores themselves and buy them out.