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[Tobor]

I thought the point was that Blockbuster can't afford the rents for their B&M selling their movies at the price they do. Not that they can't service their customers adequately.

I found another article on this, and Blockbuster lost 13 million last quarter due to "lower revenue". The stores aren't making money, so they're shutting them down as the leases expire.

The point is, I think opening an independent video store in 2012 is a terrible idea. You can't survive because the market not covered by current options is too thin.

You seem to be doing a lot of speaking for huge swaths of people ITT.

I feel comfortable doing that when the numbers back me up.

 

[BattleMonkey]

You're missing the point. The people we are both talking about are satisfied with their options. If they weren't, Blockbuster wouldn't be closing its remaining 900 stores.

It's not really about satisfaction thats closing the stores, it's that the business model no longer works. Prices of purchasing rental copies for stores continually go up along with all the costs of operation, while the rates they have to charge for rentals to compete are going down. A local store has limited reach of customer base and with competition and raising costs, it's just hard to make any money. Stores are quite large and having to cover monthly leases of 7-10k a month, renting out thousands of dvds in a week for .99 to 1.99 each is just not enough to operate these large shops anymore. Many of these stores had large and active customer bases, the stores you would always find packed and lines at the register of people renting, but the model just has become dated and not profitable anymore.

There are tons of customers who have no issue with local rental places and there is obvious interest/demand for it, but the money just isn't viable for these b&m stores anymore.

 

[ToxicAdam]

I found another article on this, and Blockbuster lost 13 million last quarter due to "lower revenue". The stores aren't making money, so they're shutting them down as the leases expire.

I feel comfortable doing that when the numbers back me up.

The numbers back up that you can't operate a huge retail space renting movies/games at less than a buck. Which is the very reason why the mom & pop video stores went under in the early 90's when Blockbuster moved into town and forced them to lower their prices.

 

[diffusionx]

Blockbuster's leases have been screwing the company for years. They saw the market going south in 2000 or so but had all these long-term leases they couldn't get out of hanging around their neck. So they've been closing them over the years. As you can see it has been a loooong process. If they didn't have those leases they could've responded to market conditions much faster.

 

[Dragoon X Omega]

My Blockbuster is still going. I re-new my membership and I asked the manager about when they are going to be out of business and he said they are not going out of business.

So I guess my Blockbuster is going strong.

 

[Stabby McSter]

There was a Blockbuster near me that finally closed after like, 14 years of being open. I was surprised it was still alive for the past four years.

I got some pretty cheap Blu-Ray movies out of it.

 

[Bleepey]

It's shame that with a brand as strong as theirs they did not get onto the streaming bandwagon. With their name they could have been the new Networks, which is the old blockbuster.... Anyhow their brick and mortar presence could be great for a games rental service.

 

[Wuthering_Heights]

Long live Family Video!

 

[BocoDragon]

Blockbuster Canada was shuttered last year, and it caused the main competitor to pull out of the business.

This is the real deal. Several times I've wanted to rent a game... And you literally can't anymore. The future is wierd.

 

[Tobor]

The numbers back up that you can't operate a huge retail space renting movies/games at less than a buck. Which is the very reason why the mom & pop video stores went under in the early 90's when Blockbuster moved into town and forced them to lower their prices.

I'm not even sure what we're arguing about anymore. This post reads like you're agreeing with me.

I'm not denying there will be a group of people left wanting here. A group that is too poor to afford cable or Internet, and is looking for a selection of videos greater than Redbox offers. I do not think this group is large enough to support new B&M stores. They weren't supporting the stores they had in sufficient numbers to keep them open. That this group is now used to paying a dollar a rental makes it even more difficult.

Redbox could theoretically expand. By that, I mean increase the size of the kiosks and carry more titles. That would be an interesting experiment.

 

[Tex117]

A relic of the 90's....

 

[Azzurri]

I've always liked BB, they shut the remaining BB's in my city last year. I guess BB reminds me of the good ol 90's, so it's pretty sad to see them go.

 

[Kusagari]

Blockbuster Canada was shuttered last year, and it caused the main competitor to pull out of the business.

This is the real deal. Several times I've wanted to rent a game... And you literally can't anymore. The future is wierd.

No redbox in Canada?

They do carry some games, albeit very few

 

[The Power Of Snap]

Blockbuster Canada was shuttered last year, and it caused the main competitor to pull out of the business.

This is the real deal. Several times I've wanted to rent a game... And you literally can't anymore. The future is wierd.

In quebec we have this:

And it's not gonna die with the internet caps and it's the only video store in the province ...

 

[Mammoth Jones]

Blockbuster is a perfect example of failing to adapt in a dynamic market.

 

[Phoenix]

Blockbuster's leases have been screwing the company for years. They saw the market going south in 2000 or so but had all these long-term leases they couldn't get out of hanging around their neck. So they've been closing them over the years. As you can see it has been a loooong process. If they didn't have those leases they could've responded to market conditions much faster.

The most bizarre thing is that they actively ... ACTIVELY AND WITHOUT RESERVATION chose to never acquire the real estate and instead lease their spaces. Their CFO was a complete moron. In the time that BBI had those leases it could have purchased the properties several times over. Instead the leases continued to drag on profitability for decades and the senior leadership of the company never saw an issue with it despite all the evidence that it was killing the company.

Netflix/Redbox didn't kill BBI, BBI killed BBI. At the end of the day they simply ran out of money through their own collective internal incompetence at the executive level. As someone that was on the inside at that level, it was just so bizarre to see all the evidence there and yet the decisions continue to be made to do more and more and MORE retail.

Even as the R&D groups advocated going set top boxes and kiosks, the call from the CEO was MOAR RETAIL! He was a moron of the highest caliber in an industry that he didn't really even understand. Keyes was from the 7-11 retail world... the problem was that Blockbuster's woes couldn't be solved by increasing margin on the items sold in the stores.

The stuff I know about the fall of that company could write a book. Seriously.

 

[itwasTuesday]

Even though one of the Blockbusters around me has been closed for almost a decade, I still refer people to places by proximity of the building that used to be a Blockbuster.

You know, the bowling ally by the old Blockbuster
Chinese place
ABC store

It all works.

 

[ToxicAdam]

That would be a pretty interesting tumblr in 5-6 years "What did your local Blockbuster turn into?"

 

[Joe Shlabotnik]

The most bizarre thing is that they actively ... ACTIVELY AND WITHOUT RESERVATION chose to never acquire the real estate and instead lease their spaces. Their CFO was a complete moron. In the time that BBI had those leases it could have purchased the properties several times over. Instead the leases continued to drag on profitability for decades and the senior leadership of the company never saw an issue with it despite all the evidence that it was killing the company.

Netflix/Redbox didn't kill BBI, BBI killed BBI. At the end of the day they simply ran out of money through their own collective internal incompetence at the executive level. As someone that was on the inside at that level, it was just so bizarre to see all the evidence there and yet the decisions continue to be made to do more and more and MORE retail.

Even as the R&D groups advocated going set top boxes and kiosks, the call from the CEO was MOAR RETAIL! He was a moron of the highest caliber in an industry that he didn't really even understand. Keyes was from the 7-11 retail world... the problem was that Blockbuster's woes couldn't be solved by increasing margin on the items sold in the stores.

The stuff I know about the fall of that company could write a book. Seriously.

Not for nothing, but this sounds like something that would be of great interest to a significant number of people.

 

[Phoenix]

It's shame that with a brand as strong as theirs they did not get onto the streaming bandwagon. With their name they could have been the new Networks, which is the old blockbuster.... Anyhow their brick and mortar presence could be great for a games rental service.

They tried, I can tell you that for certain. The issue there is that they weren't technically capable of streaming and had to buy a company to do it - which cost a ton. Then they had to get streaming rights - which cost a ton. And finally, they were politically afraid of going away from Windows Media and adopting a format that was more friendly to streaming at the time. As a result, even when they did have a streaming platform - it wasn't available on the one platform that would potentially save them.... the iPhone.

 

[BocoDragon]

In quebec we have this:

And it's not gonna die with the internet caps and it's the only video store in the province ...

Oh.. Never say never.

Our major rental chain was run by Rogers. They didn't need to die, just pull out of the business.

Rogers was the last chain in the province too. Even having no competition doesn't seem to make this a viable business. We literally have nothing now. A tiny scattering of mom n pops, perhaps?

And what I'm saying is, the switch the digital services isn't complete. This isn't a matter of people being just fine getting their content through the Internet. There's a lot of unmet need out there (notably gamers and those who aren't tech saavy). If I want to rent a game right now in Vancouver, BC, I wouldn't even know where. That's just wierd.

They killed the business before the Internet had the opportunity to replace it.

 

[BattleMonkey]

Blockbuster is a perfect example of failing to adapt in a dynamic market.

It's pretty tough for a large B&M chain to quickly adapt to a huge change into a digital domain. Many large retailers like Blockbuster, especially those with stand alone locations apart from any strip mall, had to be put in 15-20 year leases ahead of time. Shops attached or anchored to a strip mall storefront usually don't pay as much. Even if they did moved to a more digital and online focused venture, the company was chained down by all it's store fronts that they couldn't just fold up overnight.

 

[lunarworks]

Blockbuster Canada was shuttered last year, and it caused the main competitor to pull out of the business.

This is the real deal. Several times I've wanted to rent a game... And you literally can't anymore. The future is wierd.

Yup. Blockbuster completely imploded up here. I think the plan was to close 2/3 of the stores, but in the end they said "fuck it" and closed them all.

 

[diffusionx]

The most bizarre thing is that they actively ... ACTIVELY AND WITHOUT RESERVATION chose to never acquire the real estate and instead lease their spaces. Their CFO was a complete moron. In the time that BBI had those leases it could have purchased the properties several times over. Instead the leases continued to drag on profitability for decades and the senior leadership of the company never saw an issue with it despite all the evidence that it was killing the company.

That's pretty amazing. If they acquired that real estate they would have tons of assets in very desirable retail locations. Think about everywhere there was a Blockbuster.

For a long time, McDonald's has basically been a real estate company with a restaurant business on the side. That could've been Blockbuster.

And those "senior leaders" got paid millions of dollars for the privilege.

 

[Skiesofwonder]

This stinks. I just recently discovered a Blockbuster located right next to my campus. Not only do I have the free six month BB total access (two mail and two in-store rentals per month), I also signed up for their blue ticket (unlimited in-store rentals and no late fees) which is $15 a month. Through both of these, I have watched The Godfather, played through Bayonetta and Sleeping Dogs, rented NCAA Football 13, and went through four whole seasons of Dexter, all within a months time. The place is pretty busy, but all the major games, shows, and movies are present and very rarely rented out. Not to mention with the blue ticket, if you rent something additionally, you get another rental for free. considering 90% of stock is 99 cents, that blows away Redbox right there (imo). I feel like I stumbled upon a largely undiscovered goldmine of media, and I will be sad to see it go. :/

 

[Phoenix]

That's pretty amazing. If they acquired that real estate they would have tons of assets in very desirable retail locations. Think about everywhere there was a Blockbuster.

For a long time, McDonald's has basically been a real estate company with a restaurant business on the side. That could've been Blockbuster.

And those "senior leaders" got paid millions of dollars for the privilege.

That was EXACTLY the argument made by certain parts of the executive team. We might as well own the retail locations. It didn't make any sense whatsoever to not own them given what we were paying and the terms of the leases that we were entering into. Even now they would have at least been able to rent/sell the real estate.

 

[TheYanger]

The most bizarre thing is that they actively ... ACTIVELY AND WITHOUT RESERVATION chose to never acquire the real estate and instead lease their spaces. Their CFO was a complete moron. In the time that BBI had those leases it could have purchased the properties several times over. Instead the leases continued to drag on profitability for decades and the senior leadership of the company never saw an issue with it despite all the evidence that it was killing the company.

Netflix/Redbox didn't kill BBI, BBI killed BBI. At the end of the day they simply ran out of money through their own collective internal incompetence at the executive level. As someone that was on the inside at that level, it was just so bizarre to see all the evidence there and yet the decisions continue to be made to do more and more and MORE retail.

Even as the R&D groups advocated going set top boxes and kiosks, the call from the CEO was MOAR RETAIL! He was a moron of the highest caliber in an industry that he didn't really even understand. Keyes was from the 7-11 retail world... the problem was that Blockbuster's woes couldn't be solved by increasing margin on the items sold in the stores.

The stuff I know about the fall of that company could write a book. Seriously.

This...is mind boggling. Once they were established and expanding why would you continue freaking leasing everything.

 

[harmonize]

In rural areas, it sounds like. They're at 900 stores now. Once this is all said and done, they'll ironically be the size of one of the small regional chains they put out of business in the 80’s and 90’s.

For real.

They drove two of my favorite local rental places out of business, replacing them with shitty rental policy and annoying employees, and now they've just recently shut down the only store they own within reasonable driving distance. I'm not going to lose much sleep over the slaying of this corporate giant.

 

[show me your skeleton]

were they not given the opportunity to buy netflix for some tiny price early on?

 

[Trent Strong]

Don't know why everyone hates Blockbuster. It was a great place to rent video games. And a lot of 6 to 8 hour cinematic games these days are only worth a rental, not a 60 dollar purchase.

 

[Wthermans]

Sad to see them go. We lost Hollywood Video about 3 years ago and Blockbuster last year. Only "same day as DVD" rental service we now have is through Hastings which is regional and going through their own problems.

Redbox NEVER has the movies I want to watch, (and getting a BluRay is like pulling teeth) and I maybe rent 1 movie every 3 months since their selection is such garbage. Netflix is even worse. Not only is the selection trash, but it constantly eats into my 100GB monthly bandwidth cap.

The only other option is to use OnDemand through the local cable company, but I'm not paying $5-7 for a 24 hour digital rental.

All in all, I'm extremely disappointed with current entertainment offerings and as such, my procurement of legitimate offerings from the entertainment industry has dropped dramatically compared to just a decade ago.

 

[Tobor]

were they not given the opportunity to buy netflix for some tiny price early on?

Yep.

Yet Antioco isn't seen as the savior who's going to reinvent Blockbuster. He's a tough negotiator, a strong manager. "But management and vision are two separate things," says a former high-ranking Blockbuster exec, who recalls, "We had the option to buy Netflix for $50 million and we didn't do it. They were losing money. They came around a few times."

Instead, in 2000, Blockbuster inked a 20-year exclusive video-on-demand pact with Enron as the energy conglom launched into telecom. Blockbuster canned the pact after nine months.

http://www.variety.com/article/VR1117930420?categoryid=18

Blockbuster signing a deal with Enron is hilariously awesome.

 

[ViewtifulJC]

We had 3 Hollywood Videos, 4 Blockbusters, and a few local rental places for the longest time around here. Now, we down to just one Blockbuster I use to rent the latest games.

Please stay around, local Blockbuster. Q1 2013 is gonna KILL me

 

[LosDaddie]

Nostalgia makes me sad to see BB go away. Always loved as a kid heading to BB on a Friday night to pick up a couple movies/games for the weekend. But I haven't used them in at least 5yrs. So whatevs.

BB probably had too many divisions fighting amongst themselves to stay with the current trends. Should've taken the Netflix and Red Box business models by the horns when BB had the chance.

 

[Alebrije]

Block busters here in Mexico are doing well , I am pretty sure the one on my town moves 10,000.00 U.S montly just for movie rents. It also gets money from game rush (videogames, consoles ) , candies , NFL official products. The store is pretty new ( 4 years at much).

Piracy here in Mexico is a great problem but Block buster has manage to survive it and also the Sky , Dish rampage of the last two years ( even poor people has dish in most places of Mexico).

Anyway I guess once Mexico gets the same speed /cost on internet service that the U.S. has blockbuster will be doomed. But for this we will need to wait 10 or more years...


We still have a big chain of music stores called Mixup :

 

[strobogo]

I thought it was weird that Blockbuster built a new store in my city (which is around 60k and already had a Blockbuster and two Family Videos) in 2009, when their problems were very well known and they were already closing stores. And not only did they build a new store, they built it less than 2 miles from the other one. On the same road. It stayed open less than 6 months after the bigger, older store shut down.

They built a smaller store with less selection in the middle of the economy tanking hard and their own internal financial crisis literally down the street from a bigger store with a much larger selection and stock. Plus, Red Box and Netflix were exploding. On top of that, you had two Family Videos (on completely different sides of town, you know, the way that makes sense) with significantly cheaper prices on rentals. It was a surprise to no one that it wasn't even open 2 years. And with in a week of Blockbuster being completely out of town, Family Video raises prices for "better value".

 

[Biff]

I remember when I used to love going to Blockbuster as a kid to visit the gaming section.

Never actually rented games as they were always too expensive. Just wanted to see the new games.

Then the Internet happened.

 

[Mitsurux]

We still have 2 blockbusters, 1 large non-chain store and 2 Family videos all with in a ten mile radius (not to mention redboxes at about every supermaket)... its the rental promise land...

 

[Bleepey]

The most bizarre thing is that they actively ... ACTIVELY AND WITHOUT RESERVATION chose to never acquire the real estate and instead lease their spaces. Their CFO was a complete moron. In the time that BBI had those leases it could have purchased the properties several times over. Instead the leases continued to drag on profitability for decades and the senior leadership of the company never saw an issue with it despite all the evidence that it was killing the company.

Netflix/Redbox didn't kill BBI, BBI killed BBI. At the end of the day they simply ran out of money through their own collective internal incompetence at the executive level. As someone that was on the inside at that level, it was just so bizarre to see all the evidence there and yet the decisions continue to be made to do more and more and MORE retail.

Even as the R&D groups advocated going set top boxes and kiosks, the call from the CEO was MOAR RETAIL! He was a moron of the highest caliber in an industry that he didn't really even understand. Keyes was from the 7-11 retail world... the problem was that Blockbuster's woes couldn't be solved by increasing margin on the items sold in the stores.

The stuff I know about the fall of that company could write a book. Seriously.

No word of a lie, I'd love to hear it. I find it interesting seeing how large corporations work

 

[Xero]

My girlfriend was let go from blockbuster earlier this year. I really doubt the line about closing unprofitable stores and her and I both believe they are just closing all of them when the leases were up. Closing the most profitable stores in the area as soon as their leases are up doesn't jive with that thought process. They were never really able to evolve after they bought their independence from viacom. They were busying trying to pay off their buyout to be able to stay competitive, and what they did do was too little too late.

 

[Bleepey]

They tried, I can tell you that for certain. The issue there is that they weren't technically capable of streaming and had to buy a company to do it - which cost a ton. Then they had to get streaming rights - which cost a ton. And finally, they were politically afraid of going away from Windows Media and adopting a format that was more friendly to streaming at the time. As a result, even when they did have a streaming platform - it wasn't available on the one platform that would potentially save them.... the iPhone.

Why did Netflix succeed? And considering how they could have got them "cheap" why didn't they snap it up and instead go with Enron.

 

[Marty Chinn]

I think what worries me about Blockbuster going under is the loss of access to content. We'd be pretty much left with Netflix being the only source for a wide library of movies and let's face it, Netflix isn't all high and mighty like it used to be. Streaming doesn't cut it as far as content libraries go, so it's just uneasy feeling of the lack of competition and the risk of losing a wide array of content that doesn't like the way things are playing out. I know business models will change and adapt, but how long will it take to catch up and what do we lose in the process?

 

[bryanee]

My local BB better not close here in the UK. I paid off Halo 4 Limited, Dishonoured and Far Cry 3 yesterday.

 

[Tobor]

Block busters here in Mexico are doing well , I am pretty sure the one on my town moves 10,000.00 U.S montly just for movie rents. It also gets money from game rush (videogames, consoles ) , candies , NFL official products. The store is pretty new ( 4 years at much).

Piracy here in Mexico is a great problem but Block buster has manage to survive it and also the Sky , Dish rampage of the last two years ( even poor people has dish in most places of Mexico).

Anyway I guess once Mexico gets the same speed /cost on internet service that the U.S. has blockbuster will be doomed. But for this we will need to wait 10 or more years...


We still have a big chain of music stores called Mixup :

Woah, those are current pics? It looks like a Tower Records circa 1995.

 

[PK Gaming]

They died in Canada during the Dish network acquisition and the closure sales were glorious. Started at 15-20% off but near the end it was 75%+ off and we were getting stacks and stacks of movies for $20-30

I did this with video games. it was glorious.

I had some money to spend so I was like

"shit let's be santa"

 

[Ninja Scooter]

I wonder if we'll see the rise of mom & pop rental stores again, as not everybody can be served by Netflix / online streaming / etc. That would be nice.

They can. You might see some local mom and pop DVD/gaming shops pop up, much like there's been a mini-resurgence with vinyl record shops, but it is completely niche and a novelty. A large majority of people are just fine with Redbox/netflix and various other streaming options to satisfy their needs. It's a case of various new idea replacing one old one, in the same way Pandora and YouTube had just as much of a hand in the death of dedicated record stores as iTunes did.

 

[ProfessorLobo]

As someone who used to be absurdly close to the situation I can tell you with certainty that "Its all going away". All of it. With absolutely certainty.

And this is the face of the man who killed it:

Jim Keyes

Tell me more.

 

[Rich!]

My local BB better not close here in the UK. I paid off Halo 4 Limited, Dishonoured and Far Cry 3 yesterday.

As an ex manager with ties to the company still, I say this:

BB UK is up for sale too and its not looking good. Get your money back asap, if I were you as if BB did go under like GAME did, which is basically going to happen, your money on the system will be locked and absorbed into their losses. And BB is less likely than GAME was to bounce back from it.

So uh yeah. I had £40 on a game, and I used it ASAP to get it off.

 

[xbhaskarx]

That would be a pretty interesting tumblr in 5-6 years "What did your local Blockbuster turn into?"

5-6 years?? Don't you mean now? Mine was empty for the last few years aside from turning into a Halloween store every fall. Some new business recently moved in, though.

 

[Lion Heart]

I remember when the blockbuster opened up near my house (in Canada) 7 years ago, I was so happy. There were rumours about a possible Mcdonalds, Pizza Hut, etc but Blockbuster was the best case scenario for me at the time.

There were a lot of experimental pricing schemes over the years but the best one by far was the "no late fees" deal where you essentially get a game for a month and a half for ~$13. It lasted a good 2 years.

The sad thing was my blockbuster was quite successful and survived the initial closings but inevitably went under during the Dish acquisition.

If I want to rent a game right now in Vancouver, BC, I wouldn't even know where. That's just wierd.

.

Living in BC you are lucky because dvdlink.ca (online rental service) is located in that province so you would get stuff ridiculously quick, maybe 1-2 days at best. I'm in Ontario and it takes me 5 business days.

As for the service itself, when I joined last year it was really great, new releases were in stock almost instantly, but for the last few months its slowed down. Like I still don't even see RE6 in the "preorder" (ie coming soon) section which makes me think they might not even get it. Movies are better though but I'm hoping the gaming stuff gets sorted out and if so I highly recommend it.