Quick question on activity this morning... I am sure most of you are aware that Netflix is launching their new "watch online" option and it looks like they will gap open this morning. Will this hurt BBI's stock because they are directly competitive with NFLX or will it boost BBI because of the jolt to the online movie rental industry in general? Thanks in advance.
Acoosticant good morning. A couple things to keep in mind. One I severely doubt you get a pop out of NFLX today this is old news. Infact we talked about it over the weekend right here on ET! The watch now feature is a slow rollout most people won't have it until June. Also it's a bum set up for the consumer you will for you extra $5 get SIX HOURS of movie time WOW! What a rip off for the full $18 Netflix subscription you are bumped up a bit to I think sixteen hours. The choice of movies is punk 1000 titles nothing new mostly TV show syndicated crap. Apple has been talking about this technology for 2 years the one that allows you to watch as the film is being downloaded no wait overnight-- my research indicates that both Apple & Netflix will be using a solution by Sonic Solutions SNIC-- this my friend might be the real play here. Blockbuster is doing very well, subscription-wise I think even better than NFLX, this news shouldn't derail them at all.
Blockbuster breakthru is now they allow you to rent online and return movie locally and get a new movie rent free for each online movie. For standard 3 movies /month deal the difference is enomous, I can get as much as 12 movies/ a week with blockbuster but only 3 movies/week from netflix.
Yes...my wife and I actually use this and love it. Netflix seems to be a total rip off to what you get for the price with Blockbuster. I didn't know the details of how the new Netflix option worked but it sounds likea desperate attempt to make up for not having real store locations.
I tried NFLX for a couple of week and i really didn't like the time frame on which the movie took to get to me. I rather go to BBI and just pick it up than have to wait a day for the movie.
blockbuster dilemma is how to integrate the online with the local system, the solution turn out to be very simple. They already have coupon system to allow you free rent, all they have to do is printing the couple code on the return envelope and bam, the systems are integrated. Problem is this means lots of free movies, I wonder if they have enough cash to sustain this campaign.
I am not sure how they can make money off of people like me. I used to have 3 out plan with Blockbuster. I can now exchange return envelopes with movies from the store, I found that I have too many DVDs to watch. I understand their motivation which is to increase foot traffic so people would buy their popcorn and other stuff. But I don't buy any. I just go in to exchange and get out. I have just downgraded my plan from 3 out to 2 out which means Blockbuster lost $4 per month of revenue from me.
Blockbuster will be bankrupt in 5 years. There is no need to walk into a store and rent videos, is this 1985 or 2007.....
Blockbuster may close as many as 960 US stores * By Michael Liedtke, AP Business Writer * On Tuesday September 15, 2009, 7:08 pm EDT SAN FRANCISCO (AP) -- Blockbuster Inc. may close as many as 960 stores by the end of next year, shedding more dead weight as the struggling video rental chain tries to reverse its losses and fend off rapidly growing rivals Netflix Inc. and Redbox. AP - FILE - In this Aug. 10, 2009 file photo, a pedestrian walks past a Blockbuster Video store in ... AP - FILE - In this Aug. 10, 2009 file photo, a pedestrian walks past a Blockbuster Video store in ... The cuts outlined in documents filed Tuesday would leave Blockbuster with about 20 percent fewer U.S. stores. The previously confidential documents didn't identify the locations of the endangered stores. Blockbuster hasn't made any final decisions on the possible store closures, Chief Executive James Keyes said in an interview Tuesday. Keyes described the closures as something that Blockbuster is considering as it sets up more DVD-rental kiosks in the stores of other merchants. It's a concept that has been popularized by Coinstar Inc.'s Redbox. By the middle of next year, Blockbuster hopes to have 10,000 kiosks scattered around the country. It had just 500 kiosks at the end of August. "We could have fewer physical stores and still have more rental points for our customers," Keyes said. Blockbuster's shift serves as another reminder of video stores' waning appeal as consumers buy and rent movies through the mail, on the Internet and through cable connections and standalone kiosks. The shift has threatened to turn once-mighty Blockbuster into a dinosaur. The Dallas-based company has been trying to evolve by embracing kiosks and expanding into rentals delivered through the mail and the Internet. But it hasn't been enough to justify keeping so many stores open, prompting management to consider cutting much deeper than it anticipated to save money and keep its lenders happy. About 18 percent of Blockbuster's stores aren't making money, according to the documents filed with the Securities and Exchange Commission. Blockbuster is thinking about closing between 810 and 960 of its U.S. stores before 2011, up from the 380 to 425 stores that normally would be closed during that time span, according to Tuesday's filing. As of mid-August, Blockbuster had closed 276 stores so far this year. Besides closing stores, Blockbuster indicated that it will convert at least 250 stores into smaller outlets. If Blockbuster hits the high end of the new target for store closures, it will represent 22 percent of its 4,356 stores in the United States. Netflix's DVD-by-mail service, launched a decade ago, has hit Blockbuster particularly hard as more households have embraced the concept of picking out their rental choices online before the DVDs are delivered through the mail for a monthly subscription fee that usually runs from $9 to $17. In the last two years, Netflix lured even more customers by building up its library of movies available for instant viewing over high-speed Internet connections. Netflix now has 10.6 million subscribers and, unlike Blockbuster, is becoming more profitable. The Los Gatos-based company earned $55 million through the first half of this year while Blockbuster lost $15 million. Redbox also has been hurting Blockbuster with its red kiosks that rent DVDs for just a $1 per night. That low price has proven particularly compelling during the recession as more people pinched pennies. In a Tuesday research note, Barclays Capital analyst Douglas Anmuth said Blockbuster's accelerated store closures should bolster Netflix. Investors seemed to agree as Netflix shares surged $1.69, or 3.9 percent, to close Tuesday at $44.97. Blockbuster's cost-cutting plans also pleased Wall Street as its shares gained 7 cents, or 5.2 percent, to $1.40.