Blockbuster is preparing to file for Chapter 11 bankruptcy protection in the very near future, according to multiple reports, including one in The Chicago Tribune. The movie rental business has been struggling for some time now and is faced with increased competition from rivals Netflix and Redbox.

The Tribune reports that Blockbuster executives have been visiting movie studios, trying to negotiate a "pre-planned" bankruptcy where most creditors are on board before the actual filing. According to the Tribune's sources, a mid-September date is being considered.

How this could effect consumers is unclear, but most retailers operate through a reorganization without shoppers knowing a thing. And if Blockbuster can get out from under its nearly $1 billion in debt while in Chapter 11, it could go on as a much leaner company. It closed roughly 1,000 stores in the last year alone attempting to do just that. Blockbuster reported a loss of $69 million for the second quarter ending July 4, 2010.

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