Is Blockbuster in Serious Trouble?
As Bob Dylan would say, the times they are a-changin’. I haven’t rented a DVD from a video store in years, and apparently I’m not alone, because there is a lot of speculation that the end is near for Blockbuster, the largest rental chain in the U.S. It’s certainly not something that I would have foreseen a few years ago, but it makes a lot of sense given the current situation. Video on Demand and Netflix are taking over, and although Blockbuster has spent a lot of money to try and compete with their own “Total Access” rental by mail service, it’s not getting them anywhere. According to an article over at CNet’s Crave, Blockbuster’s revenue has fallen 5.7 percent since last quarter and they have suffered a net loss of $35 million. Layoffs are imminent, and 526 outlets have closed over the past year. (Other major rental chains Hollywood Video and Movie Gallery have also announced massive closures over the past few months.)
It may still be years before Blockbuster is finally put out of its misery, but in the meantime they are only delaying the inevitable with a new decision to shift focus away from their online rental service and focus more on increasing overall membership. Netflix, on the other hand, are positioning themselves to be ready for the next evolution in movie rentals by getting into digital downloads and streaming movies online. Their future’s not looking very bright, but at the same time, it’s strange to think that video rental stores may completely cease to exist. What do you think, is Blockbuster is doomed, or will there always be some demand for video rental stores?
Comments (18)
Who am I to say?!?
I never rent movies though. It’s ridiculously expensive, its half 75% the cost of a theater ticket, and no way is that worth the grief of having to return it. Sometimes when I’ll be walking past one of these rental stores I’ll ponder going in, but then I realize that it will fuck my next day up, because I will have some sort of deadline to return to that same spot.
But I don’t use Netflix or the european lovefilm service either. I don’t have much faith in my ability to actually package and send the movies back to them.
Posted by Henrik on November 7th, 2007both Blockbuster and Rogers Video have reduced their hours of operation. If they are smart they will move more into the retail sales side and increase their selection and have more competitive prices.
Posted by Goon on November 7th, 2007I think something else to consider is how cheap it is to outright buy DVDs these days. New releases may retail for an average of $25 or so, but if you scour the sales racks or Amazon, you can find a lot of really awesome stuff for under $10. Nine times out of ten, I’d rather just buy a movie than rent it. I’m willing completely to pay an extra few bucks to avoid the hassle of returning a movie to the video store while simultaneously adding to my DVD collection. I think I rented The Godfather at least three times without ever watching it before I just capitulated and bought it for $9. Now it’s sitting there on my shelf, ready to watch if the mood ever strikes; I really can’t beat that kind of convenience.
Posted by Liz on November 7th, 2007Who likes to return a video rented the next day? Nobody does, if something comes up on TV, I am all for watching it while it’s on so my DVD rental usually takes the backlash of not being watched. As of Blockbuster, they inserted a new policy a few years back with “no late fees” rentals. This means you can bring up your dvd up to 7 days past your due date. A weekly rental then becomes a 2-week rental and a 2-day rental goes up to 9. This might appeal to customers like Henrik.
As for myself, I go to the video rental store every week. I have to specify that the chain is not Blockbuster but rather “La Boite Noire” which is an all-around video chain, focusing on foreign movies. The location I go to have a pretty sweet cult section. So I’m all for video rental stores…but I’m much more for alternative video rental stores.
Posted by Julien on November 7th, 2007i think the ‘no late fees’ policy might actually be part of where their loss comes from. i’ve worked at a video store and those fees are a huge boost. more than half of the customers have late fees each time they come in, to the point we had stats on the screen for each customer of percentage of fees waived vs paid (so you can keep track of who argues, once they reach a certain percentage of waived fees, well they dont get any slack anymore with their excuses)
Posted by Goon on November 7th, 2007I heard their “late fees” have just become “restocking fees” instead, but I don’t know if that’s true or not. I’m with Liz, I’d rather just buy a DVD, and I think sales of DVDs may be the single biggest reason why rentals are down.
Posted by Sean on November 8th, 2007Blockbuster videostores will NEVER close down. They already have their own online program and even if they aren’t used as the main place to rent, it’s used to exchange/return movies they received online and offer direct customer service.
I’m with rest of you guys in saying that I’d rather buy dvds than rent them, but there are a lot of people who don’t have any interest in owning movies and this is and has been their solution.
Plus, your forgetting about all the videogames they have. When I was a kid, I loved renting games and I would usually rent a game before shelling out $40-$60 on a game.
Posted by Primal on November 8th, 2007The ridiculous price of video games does make them more appealing to rent. That is probably a good point that games will keep blockbuster in business for the time being.
But doesn’t the new game consoles offer downloadable stuff ?
Posted by Henrik on November 8th, 2007At the same time, I am not interested is spending $8 for a game I can keep for two days when I can wait a few months about buy it for $20-30.
My biggest issue with Blockbuster/Rogers/etc. is the ridiculously high cost.
Posted by Chris on November 8th, 2007That’s a good point about the game rentals, although there are companies now that offer a “rental by mail” service for video games as well. And you can keep the games as long as you want!
Posted by Sean on November 8th, 2007Sean. Know any of these Online Game Rental places in Canada? My wife just bought a Wii. And rented a game at BB in Ontario, it was $11 after taxes for a week rental. oi!
Posted by Kurt on November 8th, 2007http://www.getgames.ca/
http://www.gameaccess.ca/
Those are two that I know of, although I’m not sure how good either service is.
Posted by Sean on November 8th, 2007I have no problem at all returning a rented movie or game to the store. I understand when I rent it that it’s my responsibility to return it. It’s been like that ever since video rental stores were established, and I don’t really see them going anywhere because of that matter or any other, really. I use Netflix and love it, but I still swing by Blockbuster from time to time just to peruse the selection. Not to mention, they also tend to have great deals on used DVDs for purchase. In my opinion, the only downfall of the store is that the selection isn’t as large as the internet venues. But that’s why we’ve got the internet rental sites, right? I’m honestly shocked to hear so many people voicing complaints about having to return movies to the store as though it were back-breaking labor, because in my mind it’s not that big a deal. And I live almost half an hour from my “local” Blockbuster.
Posted by Rian on November 8th, 2007Rian,
If you’re swinging by your local BB anyway, why on earth are you using Netflix? BB is the same price and you can exchange your online rentals right at the store for free movies in-store and have your online movie checked in immediately so the next one is shipped.
I have NO IDEA why people use Neflix over BB. If you’re way out of range from a store, then I guess it makes sense. Otherwise BB is the way to go (and I’ve used both services). They have they exact same features on their site, but BB offers way more in value and convenience.
MORE TO THE POINT OF THE POST… I think eventually video stores will become a thing of the past, but this is a long ways off. If BB tays in business, they’ll still have small stores in the area for selling DVDs and maybe just as an outlet for the online returns.
Posted by Drewbacca on November 9th, 2007Henrik,
“I don’t have much faith in my ability to actually package and send the movies back to them.”
Are you serious? It’s that hard to put the disc back in its PREPAID sleeve and stick it in the mail slot outside your house? It’s the same as putting the disc back in its case and on the shelf.
Posted by Drewbacca on November 9th, 2007Yeah that’s definitely a hassle that I don’t want to be bothered with. And also the fact that there has been tons of issues with ‘throttling’ (is that what its called when they dont want you to have all the movies you have the right to get?) and the factor of having to watch a certain amount of movies each month to justify the expensve, I’m passing on this, probably forever.
The only people I know who uses this feature are people who just use it to burn DVDs for themselves.
Posted by Henrik on November 9th, 2007Drewbacca,
One reason that I don’t use Blockbuster’s online service is that I know two separate people who have used it and switched to Netflix because they didn’t like Blockbuster’s service. Beyond that, like I said before, I have no problem with dropping off movies at Blockbuster and paying for some new ones while simultaneously getting films from Netflix. I really don’t feel like I’d be getting much more out of Blockbuster’s service than I do out of Netflix.
Henrik,
I’ve heard the stories about throttling, too, but as a Netflix user, I’ve never had a problem with this. And if anyone should be feeling the kick of throttling, it should be me. I tend to watch a movie a day, so I’m getting about 20 movies a month from Netflix, making me the type of person they would seemingly want to screw over since I’m making the most of their services. In my experience, throttling is just something that people who are on waiting lists for new or hard to find films use as a way to bitch about the short wait.
Also, as far as making the program worth your while, if you have the Netflix deal that allows you three movies at a time and an unlimited number per month, you only need to watch 5 Netflix movies a month to break even or get a better deal than renting the same number of movies from Blockbuster stores. In my case, since I watch so many films from Netflix, I’m paying four times less for my movies than I would be by renting from Blockbuster.
Finally, to each his own, but you really couldn’t be bothered to put an envelope in the mail and wait in the comfort of your home for a new movie to show up?
Posted by Rian on November 9th, 2007So Henrik, I wouldn’t suppose you are a huge Library type of guy? Ya ya..e-books, audiobooks Kindles ad nauseum. Some people do like the physical experience, being out with the 3d people, browsing titles in a physical sense. Sort of like spending a few hours at a library, and checking out a few books to use as a sunblocker as one snoozes at he beach (I find my laptop hates the sand and burns one side of my face when similarily utilized ;~0 ) We are not all huge fans of slingbox type devices, and until they come out with an easier way…other than my current, that inserting a bluray disc into the player to instantly watch glorious uninterupted, glitch free true 1080p on my 50″ plasma, I will remain..faithfully, a techno-ludite. I have no desire to ever watch movies on my laptop or pc. There is enough free streaming TV and entertainment out there, to keep me distracted on my increasingly rare long transits.
Posted by Dave on May 5th, 2009Leave a Reply