Blockbuster To File Bankruptcy

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Alpha8472
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Blockbuster To File Bankruptcy

Post by Alpha8472 »

Blockbuster is going to file Chapter 11 Bankruptcy in September. This type of bankruptcy will allow the company to keep operating while it restructures its debt load of nearly $1 billion.

Blockbuster would use the bankruptcy to break store leases and close about 500-800 of its worst performing stores.

Blockbuster is awful. Their rentals are overpriced and their customer service is terrible. Blockbuster used to move into neighborhoods and cause independent and family owned stores to shut down. Now Blockbuster is the one that is closing down their stores. Competition from Netflix and Redbox have caused Blockbuster to lose customers.

Why pay several dollars for a DVD rental when you can get it for $1 at Redbox? Netflix also has some very good rental plans that are quite affordable. Blockbuster made money by gouging customers for years.

Movie Gallery/Hollywood Video tried to do Chapter 11, but eventually they decided to completely shut down instead. I think that Blockbuster may eventually shut down.

Strangely enough, since many Blockbusters will be closing, independent video stores might be the only ones to survive. These stores can keep going even if they make only a small profit. Blockbuster won't bother with a store that only makes a little bit of money.
Last edited by Alpha8472 on August 29th, 2010, 2:55 am, edited 1 time in total.
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Re: Blockbuster To File Bankruptcy

Post by storewanderer »

Alpha you haven't been there in a while have you? It isn't "several dollars" anymore. As if that wasn't already enough.

The Blockbusters around Reno are 5.00 per rental, you get to keep it for close to a week however.

I noticed some Blockbustes in CA have clings in the windows about a 25th anniversary promo offering 3 day rentals for 3.00. That's a promo?

They won't make it. Failed concept.
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Re: Blockbuster To File Bankruptcy

Post by norcalriteaidclerk »

I have noticed that they've been slowly trying to roll out their 'Blockbuster Express' kiosks to compete with Redbox.I know that they already have them in select 99 Cent Only Stores(one near where I live),Dollar Tree,and Rite Aid locations,but it's still very hit or(mostly)miss in greater Sacramento(I can say my RAD is not one of them.).Sooner or later,they will have to beef up the presence of those BBE kiosks if it has any chance to survive...
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Re: Blockbuster To File Bankruptcy

Post by Alpha8472 »

Blockbuster Express DVD rental machines are not owned by Blockbuster. They are owned by NCR Corporation. Blockbuster licenses the name to NCR. So very little money is made by Blockbuster off of those kiosks. In fact, very little money is made off of Blockbuster Express kiosks for NCR. The machines will take several years just to break even. NCR is primarily a company that makes ATMs and cash register systems. Self-checkout units at Walmart, Albertsons, Home Depot, etc. are all NCR machines.

My local Safeway stores have installed Blockbuster Express machines in the past week or so. They are so new that they don't even show up on the website yet.

Even if Blockbuster is completely liquidated, the Blockbuster Express kiosks will be independent. NCR has estimated that they will only install about 10,000 Blockbuster Express kiosks. The DVD kiosk business is not a big money maker. NCR wants to focus on their ATM and cash register business. However, the ATM business is really going badly. NCR is not making much money due to the troubled banking industry. NCR is losing money and it is possible that they will not survive. Most banks don't want to spend money on brand new ATMs these days, and German ATM manufacturer Wincor-Nixdorf has been stealing business away from NCR.

I think it's pretty tragic that banks are buying from a German company. The money goes to a foreign country and ATM manufacturing jobs in the U.S. are being lost. Wells Fargo and Chase recently bought tons of ATMs from Wincor-Nixdorf. They decided to replace the old Wachovia and WaMu ATMs. If NCR goes out of business who will make all of those supermarket cash registers?
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Re: Blockbuster To File Bankruptcy

Post by Kroger472 »

What adds to the troubles for the kiosks is that they don't have a national penetration with them (I haven't seen a Blcobuster kiosk up my way in Michigan. However we have Redbox which is equally popular and those are owned by franchisees.
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Re: Blockbuster To File Bankruptcy

Post by Alpha8472 »

Redbox machines are owned by Redbox. They just rent a little space from individual stores. For example, the 7-Eleven stores in my area all rent a little space to Redbox. Redbox has been expanding like crazy across the country. They now have Redbox machines at every single Walmart and Kroger owned store. Redbox will also be coming to every single CVS, and in many areas Redbox is available at Walgreens and McDonald's.

Blockbuster Express only has a deal with Safeway. Redbox has signed up with many more retail chains. Blockbuster Express simply cannot compete. They will never get enough locations to even equal the number of Redbox machines.
Last edited by Alpha8472 on September 23rd, 2010, 1:28 am, edited 1 time in total.
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Re: Blockbuster To File Bankruptcy

Post by Brian Lutz »

All of the 7-Elevens here have recently added Redbox machines, and all the Kroger stores (QFC and Fred Meyer) had them already (although they previously had a different brand of DVD kiosk.) I haven't seen a DVD kiosk in an Safeway store around here, but that's because most still have in-store video rental sections.
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Re: Blockbuster To File Bankruptcy

Post by Super S »

I can only think of one Safeway that had a video rental section (now gone), seems like not many in the Portland division had them. WinCo did away with them several years ago. Which makes me ask, does Albertsons still have video rentals?

The redbox concept is making many inroads, my local Fred Meyer as well as Walgreens have them in addition to nearly every McDonald's.
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Re: Blockbuster To File Bankruptcy

Post by Alpha8472 »

Safeway signed an agreement to install Blockbuster Express machines in their stores. Right now new Blockbuster Express machines are showing up. I assume that Safeway began eliminating their DVD rentals in anticipation of the new Blockbuster Express machines. Safeway used to use DVDPlay, but that got bought up by NCR which operates the Blockbuster Express machines.

Redbox actually began as a company by buying machines from DVDPlay. Then Redbox took off and surpassed DVDPlay in business. DVDPlay was not doing so well so they got bought by a bigger company.

Albertsons has used Redbox machines for a few years, so I believe that they all got rid of their DVD rental sections a long time ago.
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