rental

Blockbuster to shutter up to 960 stores

A Securities and Exchange Commission filing has revealed Blockbuster's plans to close up to 960 retail store locations by the end of 2010 as it attempts to makes its operation more financially stable.

According to the company's filing, it plans to close all unprofitable stores, while refocusing its efforts "to improve four-wall profitability." To do so, the company first analyzed its over 7,000 stores to determine if they were profitable or not. A whopping 18 percent of Blockbuster's stores are unprofitable. The remaining stores are profitable.

Prior to making the decision to close some of its unprofitable locations, Blockbuster planned to close 280 to 300 stores as part of a grouping it calls, "normal closures." Stores added to the "accelerated closures" category will also be closed by the end of this year. According to Blockbuster, the number of accelerated closures will equal 300 to 385 locations.

Next year will be a slightly less active year for store closures. Blockbuster indicated in its SEC filing that 2010 will bring 100 to 125 normal closures and 130 to 150 accelerated closures. By the end of 2010, it expects to have closed 810 to 960 retail locations.

As troubling as that might sound, Blockbuster spokesperson Randy Hargrove said in a phone conversation that a certain amount of measured skepticism should be exercised. According to Hargrove, these figures are not guaranteed.

"All these stores are candidate stores," Hargrove said. "Although we may in fact close that many stores, if we can renegotiate leases or remodel stores to make them more profitable, that number might go down."

But Blockbuster's closure story doesn't quite end there. Further down in the filing, Blockbuster indicated that 275 to 300 stores are subject to the company's "lease mitigation/termination efforts." Another 250 to 300 stores might be converted into outlets. If successful, that would bring Blockbuster's grand total of rental store closures to 1,335 to 1,560, or up to about 22 percent of all the stores currently in operation.… Read more

YouTube wants to offer film rentals

YouTube wants to offer movie rentals and is in talks with several top movie studios about obtaining licenses to stream feature films on a rental basis.

YouTube is discussing the service with Sony Pictures, Lions Gate Entertainment Corp., and Warner Bros. Studios, according to a story published Wednesday in The Wall Street Journal.

This is a natural progression for YouTube which has been engaged in a year-long campaign to secure more professionally made content. The Google-owned video company offers films on an ad-supported basis from Sony Pictures and MGM. YouTube declined to confirm or deny the Journal report.

One studio … Read more

Netflix earnings beat analyst expectations

Netflix reported strong earnings after the bell on Thursday that outpaced analyst expectations, proving once again that a down economy can't slow the Web's top movie rental service.

For the company's second quarter ended June 30, Netflix saw net income of $32 million on revenue of $408.4 million, a 21 percent increase in revenue from the same quarter last year.

The Los Gatos, Calif.,-based company paid investors 54 cents per diluted share compared to 42 cents a diluted share a year ago. Analysts on average had expected the company to report 50 cents a share … Read more

Booksfree spells relief for audiobook addicts

I know Kindles and e-books are all the rage, but if I'm being honest with myself, I'll take an audiobook over virtual ink. In fact, I've come to rely on audiobooks (and podcasts, of course) to ease the drudgery of my daily commute. I can download or rip audiobooks to my iPod, hit play, and take in a crime novel or autobiography that I would otherwise not have time or attention span to read. But as any audiobook fanatic will tell you, the habit can get very expensive. A typical audiobook from iTunes or Audible will set … Read more

Netflix's Blu-ray pricing: A boon for Blockbuster?

When Netflix announced on Monday that it has decided to raise the subscription prices for those receiving Blu-ray Disc titles--10 percent of its subscribers, according to the company--the predictable occurred: people lashed out, saying Netflix is gouging customers.

In case you missed it, the new fee structure tacks on $1 per tier of the plan you're on. So if you have a one-film-at-a-time plan (two-movie allowance per month), your monthly cost has risen from $4.99 to $5.99. If you want three films at a time (unlimited movie allowance per month), your cost has risen $4, from $16.99 to $20.99. Fees are up substantially on other plans too.

Predictably, many looked at the announcement as Netflix capitalizing on consumers. Those who are upset with the release say the increase is too high. And since Netflix doesn't need to pay for packaging, and it probably gets a discount on media, given the number of copies it needs, they believe that the company is gouging customers.

I contacted Netflix for comment regarding this contention. A representative responded to me within a few minutes. He said the cost of Blu-ray discs is 30 percent higher than that of DVDs, and more of the company's customers are switching to Blu-ray, generating higher operating expenses. A $1 additional charge for Blu-ray access on all plans wasn't cutting it any longer, he said.

The representative then directed me to the company's official blog post on the matter for more information. So after all that, we still don't know how much Netflix pays.

But regardless of the motives behind this deal or the fact that some people are upset, we can't look at Netflix pricing in a vacuum. Quite the contrary, we need to compare its pricing to the competition to determine if it's still the most affordable option on the market.

Much to my surprise, Netflix might have committed an incredible blunder that it needs to address immediately: Blockbuster brick-and-mortar stores now have the more affordable option for standard Blu-ray rentals.… Read more

Blockbuster streaming: Too late

Blockbuster and TiVo announced a deal Wednesday that will make between 5,000 and 10,000 films available to TiVo users. Customers will be able to rent ($4) or buy ($20) films, including current major titles. It's about time: Netflix and Amazon's on-demand services are already available on TiVo. Netflix offers approximately 12,000 older and less compelling titles on the box, but Netflix users don't need to pay anything beyond their monthly fee to access movies on the DVR. Those who want to use Amazon's service, which already offers most of the films Blockbuster will stream, pay about the same rental fees as Blockbuster will charge.

I've called Blockbuster to task on its late release of contemporary technology, but I wanted to give the company a chance to respond, so I discussed what I consider Blockbuster's shortcomings with its newly installed senior vice president of digital entertainment, Kevin Lewis.

Lewis contends that his company is more than just a movie rental chain. He says Blockbuster is an entertainment retailer, which is why it wanted to make its service available to TiVo users.

"We are the only entertainment retailer with the ability to serve you a movie where you want, when you want it, how you want," Lewis said. "Whether it's at one of our stores, through virtual kiosks, or via downloads on a box like the TiVo, we can provide you with the most robust service." He told me that unlike Netflix, Amazon, and any other competitor, Blockbuster has the opportunity to service its customers across multiple channels, making its deal with TiVo all the more compelling.

"We recognize that our consumers don't act the same way every time because their needs are different," Lewis said. "Because of that, we plan to go wherever the consumer goes. And although Netflix and Amazon are already on the TiVo box, when we get there, users will know that we're the only company of the three that can offer them a movie no matter how they want it. Our competitors don't have that multi-channel capability. It's our special sauce."… Read more

Blockbuster to add video games to Web rental service

Coming soon to subscribers of Blockbuster Video's Total Access service are video game rentals. On Wednesday the company announced it would be adding gaming titles alongside movies to its movies-by-mail monthly service as part of a pilot program.

This program will start in the second quarter of this year, and will only be open to a limited number of subscribers. The company hopes to have it available for everyone else by the "second half of the year."

Worth noting is that Blockbuster is making a notable distinction between the value of films and video games in its … Read more

Daily Tidbits: $594 million for virtual worlds in '08

Virtual Worlds Management, a company that provides research on the growth of online virtual worlds, said $594 million was invested in 63 virtual worlds during 2008. Gaia Online and PlayFish were two of the most prominent recipients of venture funding during the year. That said, investments in virtual worlds declined as the year wore on. In the first quarter of 2008, virtual worlds received $184 million in funding. By the fourth quarter of that year, investments dropped to $101 million. Virtual Worlds Management expects a further decline in funding in virtual worlds during 2009.

Fuzz.com, a social-networking site for … Read more

Partnership puts AT&T CruiseCast in rental cars

AT&T stopped by the Car Tech booth at CES 2009 to give us a look at its CruiseCast mobile satellite TV service. The details of the service haven't changed much since the unveiling just a few months ago at the 2008 SEMA Show, but today we received a bit of news that means you may be able to experience CruiseCast for yourself sooner than you think.

RaySat Broadcasting Corp. (co-creator of CruiseCast along with AT&T) and Avis Budget Group are teaming up to offer Avis and Budget Rent A Car customers the use of AT&… Read more

December: A great time for fast cars. No, really.

As I write this, the temperature in the City of New York hovers around freezing, though it's expected to be warmer and wetter by the time this post gets published. Not the right conditions for high-performance driving, to be sure, but that won't stop enthusiasts from planning for better weather.

Eager drivers in the area have several new options since this time last year. The Monticello Motor Club, for example, is a 4.1-mile racetrack (a road course, of course, not a mere oval track) that opened last July in Monticello, NY. It's just 90 minutes by … Read more