According to the LA Times’ Company Town Blog, Blockbuster is preparing to file for bankruptcy yet again. Recently de-listed from the NYSE with a share price of 11 cents, and with a crippling debt load of over a billion dollars, it would seem that Blockbuster is on the cusp of disintegrating entirely. Upstarts like NetFlix and Redbox have cut the knees out from under Blockbuster’s traditional model, and they simply haven’t been able to maintain the kind of volume that made them so profitable a decade ago. Plans apparently call for the closing of up to 800 locations and the expansion of Blockbuster’s kiosk and online presence.
What makes this story more interesting than the cold dead body of Hollywood Video/Movie Gallery is that Blockbuster is preparing to move forward with the movie studios on board in advance. Blockbuster is a brand they have a long term, very tight-knit relationship with, and I think that in the long run Hollywood would much rather be involved with them than the whippersnappers that came in and upset the all the apple carts. Blockbuster is the only major remaining rentailer, and maintaining a presence in the physical world is far more important than a lot of enthusiasts realize. If there’s one thing that Netflix and other services are still struggling to perfect, it’s the browsing. As long as you know exactly what you want, viva la VOD, but nothing beats meatspace for finding that diamond in the rough. My summers as a kid were spent doing exactly that, and I’ve found piles of creative, wonderful, and wonderfully horrible films that I never would have seen had I not been able to pick up a box. Those niche and oddball pieces make up a big part of the business and one that you just can’t stock in a kiosk and have them move. Finally, if the studios lost Blockbuster, they’d lose a lot of leveraging power with new kids who right now are holding most of the cards. As the streaming market continues to emerge, having a wall to play against is valuable, so it’s in their best interest to help keep a “traditional” name afloat.
Don’t count Blockbuster out just yet.
Via [Company Town]
Everyone is counting Blockbuster out and anyone that does not is perceived as foolish. Times have changed and if you continue to dwell in the presence of a company that follows the examples of its competition, you're only setting yourself up for disappointment. Blockbuster will soon be liquidated and the world will be a better place.
Bankruptcy is really a dangerous case!