When I was in high school, I was present for the opening of the huge, huge Blockbuster video in the little shopping center a stone’s throw from my house. This thing was sprawling…what was once three whole storefronts turned into a yellow-and-blue showcase of the biggest collection of motion pictures I’ve seen in my life.
A little while later, a second one opened up in an older shopping area a little farther from home. Then one in Ala Moana. Mililani. Waikele. Waipahu. Kaneohe. BV was everywhere. Eventually two local video stores near the aformentioned first location crashed out of business (one of which I frequently patronized ) and a third bounced from location to location (and ultimately vanished without a trace).
Eventually, the huge BV became not so huge. In fact, its space was cut in half. Not nearly as impressive, but still vairly voluminous. And all the other stores were doing fine.
Then the Waikele location closed. No explanation given. Wasn’t that close, so I didn’t mind too much.
Then the first location contracted again.
Then two more locations contracted.
Then, just last month, the first location closed. Permanently. Which means that there’s now one remaining location within a reasonable distance. (I’m not even sure about the Mililani one right now.)
I know that businesses come and go, sometimes without warning (I’m still surprised at how one day Waldenbooks simply didn’t exist anymore), but that’s a massive cutdown by any standard. I know the franchise on the whole has made a lot of questionable policy decisions, but it’s still pretty hard to beat movie rentals for a reliable customer base.
Sign of trouble? Or is this simply overexpansion being corrected? Anyone else witness a bunch of contractions/closures in the past few years?
Forgive me, I’m a few months out of date on trade magazines…
In general, video rental is dying. Netflix is taking away a lot of business, and BBuster is just now advertising heavily at least where I live in serious competition with thewir online/instore combo package.
BBuster lost HUGE on their “No more late fees” plan.
Some of the contractions may have been planned and strategic, DVD’s take a third of the shelf space of VHS when bookshelved, so far fewer shelving units are needed than 5 years ago.
Also, Carl Ichan bouight up a pile of BBuster stock, and was/is pushing hard for them to slim down and make profit.
I’ve worked 6 years for a small chain or independat video rental stores. Hope this helps.
Blockbuster has a huge online rental business; they’ve shifted their business model. It actually makes for a compelling model, online combined with local stores. Time will tell if it is a long term model as more rentals shift to IPTV.
Another competitor for video rental is video on demand. Not big right now, but a definite threat in the future. Blockbuster is trying to do more mail order, but it’s in a contracting industry.
Remember when there were dozens of video rental stores? They are vanishing, and places like supermarkets are eliminating their video rentals or going with something like Redbox kiosks.
Blockbuster always had a very weak selection, anyway. If you wanted the most popular films, they’d always have a copy, but if you wanted anything that wasn’t a blockbuster, you were out of luck. I was glad when the Blockbuster near us became Hollywood Video.
:dubious: Blockbuster always seems to have a better selection than Hollywood, then again that makes sense since they always seem to be about twice as big. Then again I’ve rented about 8 movies in the past 8 years, but I always have to go to several stores before I find what I want even if it’s Blockbuster.
I would say that they are in trouble simply because they have gone with the Blu-Ray format rather than HD-DVD. We see how well proprietary Sony products have done in the past-Freakin’ BETAMAX should have been the clue for Blockbuster IMHO.
I haven’t really chosen sides in the Blu-Ray vs. HD-DVD competition, and I mostly agree with you about Sony’s track record when it comes to storage media, but getting a big company like Blockbuster behind them might be just what Sony needs to win this battle in the format wars.
Looking at their latest 10k, revenues have remained flat since 2002 (5.5 bil vs. 5.5 bil), however profitability has been a bit of a problem:
2002: -$1.6 bil
2003: -$978 mil
2004: -$1.2 bil
2005: -$588 mil
2006: +$54 mill
Total net losses: $3.8 billion
They have been shrinking: total assets in that time period have gone from $6.2 billion to $3.2 billion. They also piled on the long-term debt in 2004, having it go from $75 million to $1.19 billion in that year. Shareholders equity has plummeted from $4 billion to $742 million.
Well, it would if they ever had what you wanted! The BF was all like “Why don’t we quit Netflix and go with Blockbuster? We can get movies when we want them here!” and I was all like “When is the last time we went into Blockbuster for something specific and they actually had it?” <crickets>
Only Universal Studios is exclusively supporting HD DVD, while the other studios support either Blu-Ray or both formats (i.e., it’s not proprietary to Sony), so I think Blockbuster went with the leader this time.
I was just wondering this. First the BB close to my house closed and all accounts were automatically moved to the next closest store. Then one day that BB closed. It was all done quickly and in the dead of the night. Guess whoever had movies out got to keep them!
Now the Movie Gallery close to our house has a big sign that says “Welcome Blockbuster Customers!” I’m liking them better right now anyway.
I know I’ve almost completely stopped going to Blockbuster as their prices have gotten into the stratosphere. Not sure if this is a cause or an effect, but it’s certainly not good for their business. $6 for a one evening rental? Seriously?
Another factor in Blockbuster’s troubles is that DVDs for purchase are now pretty cheap. You can buy new releases for $13-20. To many people, that compares favorably to making 2 trips to BB, and paying up to $6 for the privilege.
It seems to me that Blockbuster has a better model than Netflix, at least for the customers. You’re getting (potentially) twice as many rentals by not having to wait for each movie to come, and there are bonuses like free video game rental coupons and so on.
And from their standpoint, they’re presumably saving money over Netflix by mailing the returns in bulk instead of individually. Of course, they’re still paying to have those physical locations…
This is pretty astute and hearkens back to a viciously-fought debate between Wal-Mart and Blockbuster back in the late 1990’s - the pricing of DVD’s. BB wanted them “priced to rent”, ala video tapes, with each DVD having an average price-point over $50, many of them over $100. Wal-Mart demanded that they be “priced to sell”, with an average price-point below $30 and many of them below $20.
Wal-Mart won. Since then home libraries exploded, BBV lost the “movie aficionado” market (if (the rhetorical) you love Casablanca so much, even if you’re broke you can still buy the thing), and had to reorient their store to display more “crowd pleasers” and less classics/documentaries/foreign films/etc.
Not all of them. There’s a Waldenbooks not twenty minutes from where I am right now. If their paper job application is any sign, it’s not the only one.
Borders recently cut the number of Waldenbook outlets in half, and closed all of them in many cities. Many, maybe 300, are still around, though.
I’ve never seen a Borders Express, but a search says that Borders converted at least 100 Waldenbook outlets to them. They do seem more like small Borders stores and less like Waldenbooks.
) and a third bounced from location to location (and ultimately vanished without a trace).