Comments on: Why Blockbuster brick-and-mortars will be gone in five years

Don Reisinger poured over Blockbuster's latest filings and annual reports to give you an exhaustive review of where the company stands and where it's going. And according to Don, it doesn't look good.

[cardfan1212]

Umm..duh. Lots have been saying that the past few years. Glad it hit you finally..lol

[joits]

i still can't believe people continue to go to blockbuster when there are better options in terms of brick and mortar video stores. understandable if you live in a town or city that doesn't have anything else but blockbuster or hollywood video but if you have local mom and pop stores, i don't understand why you wouldn't go there. first of all they are a lot cheaper, charging only for one day rental (why do i need to keep a new movie for five days at $5 plus tax?) and secondly for some of us, our mom and pop video stores have a much larger selection of movies, tv shows, special interest, foreign imports, video games, etc than blockbuster.

[SheriffBooth]

Nice report. Not earth-shattering news, but a thorough and informative post. Blockbuster's a dinosaur waiting for the meteor. If they'd been smart they would've skipped the mail order rental game altogether and jumped straight into digital downloads and maybe taken an early lead in that realm. But obviously that's the point of the article - no foresight from Blockbuster means no more Blockbuster.

[aztec92154]

I completely agree with your comment.

I think its sad that the brick-and-mortars will be gone soon. I actually liked going up and down the isles with my friends to go pick out a movie or a game. Its sad that Amazon might kill bookstores and that Netflix and iTunes might kill video rental shops.

[22mojom22]

I can certainly understand why Blockbuster is failing. I can't remember the last time I went to a brick and mortor store and actually paid for a rental. I am a little suprised that people claim that Blockbuster's mail rental business is so inadequate compared to Netflix. (Granted I have never been a Netflix customer so I have no personal point of comparison.) I have been a Blockbuster On-line customer since they started the service, and have always been satisfied with the service. Have I had issues with the service? Certainly, on occasion disks have arrived damaged (even broken in one instance) but Blockbuster customer service has always been quick to respond with replacements with no hassle on my part what so ever. I actually have never understood why more people do not take advantage of the service with the added bonus of being able to exchange mail delivered rentals at the store for a new movie. (Although this certainly explains why the stores are all losing money.)

[techterry]

Netflix, or any mail-order DVD service has never really appealed to me. It's very rare that I know, in advance, what I want to watch. Now that we are starting to see services that offer movie downloads, we are finally moving into the movie service of the future. Mail-order DVDs were just a placeholder in the grand scheme of things.

Once every TV has an interface to the Internet, to accept movie downloads, and once you can download full High-Definition movies to your home, you will see a clear winner in the movie rental business.

My cable company offers movies on demand but the selection is always weeks or months behind video stores and the service does not always work.

For now, Blockbuster, or other stores get my vote, because I just want to be able to go to a video store and rent a movie I feel like watching on any particular day.

[jak324]

Red Box always seems to have huge lines. That still my choice. Easy and convenient with a MUCH better price than Blockbuster.

[rkminc]

At best, you're outdated in your analysis, at worst you're using old data to extrapolate the new management team's strategy. Keyes took control in mid-2007. Citing September 2007 data to suggest the new team has failed is a bit absurd. For example, are you really suggesting that Movielink's historical losses prior to the acquisition would continue, with no synergies or cost cutting restoring the business unit's profitability? And again, you're also stating Keyes' strategy to turn around the brick and mortar operations is failed because you don't see evidence of its success in September 2007 financials? It's amusing how much people use widely available historical information to suggest the sky will be falling, when all of that information is already reflected in the current stock price. Newsflash: the sky fell. Any improvements in the business at this stage is upside. Most of the downside is already being expected.

[bnessa55]

right on!

[CloudYenda]

^^^^
100% Logical

We call wild claims of a deeply entrenched player in the movie relm randomly dissappearing in a year's time news these days?
The above poster stabbed all sorts of holes in this article so I won't restate them. I will however point out how senseless it is to go off rambling like that.
Millions of loyal customers, and plenty of fresh new changes of policy company wide, may or may not do the trick, there is no way to tell yet, the market hasn't responded.

Let's see what blockbuster is up against in the HD download world...

1. Over compressed cable and satalite channels

2. Overly complex, overly compressed, and obscure download services. Xbox live, vudu, ECT...

OR

Run to the store and grab a great movie, while you're there the blockbuster guy recomends another few movies, you grab them too, knowing he always has sizzling recommends. (ok, he did like cloverfield...)

Its all about experience baby, if blockbuster plays their cards right, (and that's a big if) they will transition to digital when the time is right.

[bnessa55]

I am currently a blockbuster employee and have been for many years. Yes, I see internally that there are many flaws, but they can be fixed. I don't like the fact that there are so many stores closing ...maybe even mine, but I do see how they can make improvments with closing dead stores with no profits. For the people who left nasty comments you know nothing about blockbuster. We have been here for decades and will continue to do so, If we have people in the company who can come to realize that to make a profit we need to listen to what the people want. Even Netflix has it's problems, but at least you can just go into a store to solve it not talk to a computer or a person it Afganistan! Keep in mind for all you who read this you have a week grace period on each movie and that does help, there are many great programs offered with this company. I will continue to pray and have faith it will succeed!!!

[pepperpup]

We've had a BB store within 5 mins walk of our home since we moved here in '99. Because it's convenient, I could simply walk over on a Sat morning around 10:00 (best time to go: a full overnight return bin almost always guaranteed a "New Release" you wanted was in there waiting for you) and grab a couple for Saturday and Sunday night. Like many who have subscription TV (me: FiOS) today, the convenience of simply shopping from the comfort of your couch and watching a trailer before agreeing as a family to order it is simply better than gambling on walking down to BB to discover the movie you thought you wanted was either gone or, worse, awful. Indeed, we rent far fewer movies than we used to largely because most of what's out there is either (a) garbage, or (b) an action flick we already saw at a "modern" theater (we have a new Rave cineplex nearby. Phenomenal, all HD picture, THX sound, great stadium seating, etc.)

The SD versions of FiOS' VOD movies are the same price as those from BB; the "HD" versions (slow down, FiOS: they're really only DVD quality @ 480p) are $1 more. Still, we always opt for the HD version ($6), which today seem to be always available with their $5 SD counterpart. But, the former always looks far better on our 60". Sadly, we're contributing to the downfall of a 1980's/1990's nostalgia: going to the movie store. We still live in the same neighborhood and routinely walk by this same BB store. What we don't see any longer, even on a Friday or Saturday night? A line of renters waiting to check out. We're realized only recently that we're more than willing to wait a month or so after the DVD is first released to VOD it to see the trailer first before decided to fork over $6. Second, as a FiOS "HD Extreme" all-in customer, we have hundreds of channels, including all the premium movie channels, which are all simulcasting in HD, to pick something to watch.

Still...there's a downside to (potentially) losing our neighborhood BB. I have a PS3 (fat) I use for BD movies. I have a small library of "eye-candy" (e.g. Batman Returns, Ironman) titles, but still liked the convenience of being able to take advantage of BB's albeit smallish library of BD titles. If BB shutters, will the BD format itself be far behind except as a boutique technology? (Slow down, everybody: very, very few people have OC3-level service needed to stream even compressed BD grade feeds into their home today or anytime soon.)

If not already done so, BB should restructure their business model to sub-TV providers like DTV, E*, VZ, Comcast, AT&T, etc. to become their VOD host and manager, thereby bypassing the intermediate model from Netflix. (I was a Netflix when they launched, but quickly tired of constantly waiting for new release-movies while getting the older titles I placed in my queue. I'm sure thing have improved. However, I'm a GameFly subscriber today and still get the occasional "gold" (read: old) PS3 title in my queue over a release that's been out for a month or so.) Maybe if GameFly started doing BD movies, too?....hmmmm....interesting concept.

Anyhow, if you're a BB retail employee, you're probably in the buggy-whip business at this point: still suitable for rural communities, but a dead business model in urban/suburban areas.