Blockbuster Takes a Final Bow

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Blockbuster To Close 300 Stores In U.S.
Scott Olson/Getty Images
By MICHAEL LIEDTKE

SAN FRANCISCO -- The final curtain is falling on about 300 Blockbuster locations scattered around the United States, meaning the once dominant video-rental store chain will have just 50 franchised stores remaining open in the U.S.

The remaining Blockbuster video-rental stores that Dish Network Corp. (DISH) runs in the U.S. will be closed by early January. As part of Dish Network's retreat, Blockbuster's DVD-by-mail service is also shutting down next month.

The cost-cutting measures culminate a Blockbuster downfall that began a decade ago with the rise of Netflix's DVD-by-mail service, followed by the introduction of a subscription service that streams video over high-speed Internet connections.

The chain's near extinction serves as another stark reminder of how quickly technology can reshape industries. Just a decade ago, Blockbuster reigned as one of America's most ubiquitous retailers with 9,100 stores in the U.S.

Blockbuster also operates in other countries like the United Kingdom, Australia, Brazil and Mexico.

About 2,800 people who work in Blockbuster's stores and DVD distribution centers will lose their jobs, according to Dish Network.

"This is not an easy decision, yet consumer demand is clearly moving to digital distribution of video entertainment," Dish Network CEO Joseph Clayton said in a statement Wednesday.

The shift has been a boon for Netflix Inc. (NFLX), which now boasts 31 million subscribers to its Internet video service and another 7.1 million DVD-by-mail customers.
The company's success has minted Netflix with a market value of $20 billion.

But Blockbuster absorbed huge losses. It closed thousands of its stores before landing in bankruptcy court three years ago. Dish Network bought Blockbuster's remnants for about $234 million in 2011 and then tried to mount a challenge to Netflix.

But the Colorado satellite-TV provider couldn't wring a profit from Blockbuster either, prompting even more store closures.

Dish Network is trying to keep the Blockbuster brand alive through an Internet video-streaming service that rents movies and TV shows by title, for a set viewing time.

Blockbuster suffered an operating loss of $35 million on revenue of $1.1 billion last year and posted an operating loss of $4 million during the first half of this year, according to regulatory filings.


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35 Comments

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mandilynn221

It is sad that movie stores are disappearing. Honestly, I haven't used one in years, but my parents still go to a smaller chain movie store on a weekly basis. I think it shows that we have reached the end of an era.

November 08 2013 at 10:33 PM Report abuse rate up rate down Reply
johnhen56

If Blockbuster and even Hollywood Video saw the writing on the wall and I can\'t believe they could not when Netflix started out, from a \"business standpoint\" Blockbuster and Hollywood Video should have teamed up and bought Netflix then either operate it themselves along with their video rental stores or \"kill it before it got a foothold\" . Many companies when they see a product, service, technology that \"could\" harm their \"botton line\" or \"market share\" simply buy the \"upstart\" then incorporate it into their company or \"kill it\"

November 08 2013 at 8:25 PM Report abuse rate up rate down Reply
knightrang

I think they are jumping the gun. I\'m sure not ready to go all streamline. I like going to the video store and interacting with the workers. Plus, you are putting all those people out of work. I thought they jump the gun when they got rid of VHS for all DVD. Lots of people didn\'t own DVD players yet, but they decided to jump the gun. Think they are doing it now.

November 08 2013 at 3:14 PM Report abuse +1 rate up rate down Reply
1 reply to knightrang's comment
itsmegp46

Industry and times change. Airlines killed off long distance rail service, the automobile killed off the horse and buggy.

November 08 2013 at 3:20 PM Report abuse rate up rate down Reply
kenyng

GREAT!!

Now they know how how the little video stores felt in the 80"s when Blockbuster put them out of business.

My friend had a little store, added a pizza oven so he could make pizza's to go, lost it all when Blockbuster opened 2 blocks away.

November 08 2013 at 2:48 PM Report abuse +2 rate up rate down Reply
nthereoff

Saturday

November 07 2013 at 7:39 PM Report abuse rate up rate down Reply
nthereoff

Spent many Saurday night renting movies from BlockBusters. Hate to see them go .

November 07 2013 at 7:38 PM Report abuse +2 rate up rate down Reply
Thomas Torres

video killed the video star..........

November 07 2013 at 4:28 PM Report abuse rate up rate down Reply
chris davis

sad to see people lose their jobs -thats the most important thing

November 07 2013 at 4:14 PM Report abuse +2 rate up rate down Reply
jjurbandecay

The big blockbuster came to town ,wiped out the small retailers. and now blockbuster is getting what they gave. And wall mart did the same ,destroying small retailers every place they open.WHEN ARE THE GOING TO GET THE SAME .!!!!!!!!!!!!!!!!

November 07 2013 at 3:42 PM Report abuse rate up rate down Reply
1 reply to jjurbandecay's comment
stvhndyman

And Home Dopey....er.... Home Depot did the same to Mom & Pop hardware stores.

November 09 2013 at 3:13 AM Report abuse rate up rate down Reply
alimcke

I cancelled my internet/dvd service with them months ago...the customer service was terrible and they would charge my cc multiple times for the same movie. TERRIBLE! good riddance!

November 07 2013 at 2:33 PM Report abuse rate up rate down Reply