Blockbuster Struggles to Keep Up With Netflix, Redbox
Video chain store could close hundreds of stores across the country
By SAJID FAROOQ
Updated 2:55 PM EDT, Tue, Sep 15, 2009
Ben Bernanke may think that the recession is over but don't tell that to the executives at Blockbuster.
The corporate heads of the video chain store have been scratching their heads recently trying to figure out how to approach a quickly changing market.
And now the Starbucks of video rentals may be following the coffee giant's lead and closing stores across the country to deal with the change, according to a regulatory filing reported by the Biz Journals.
The paper reported Blockbuster may close up to 960 unprofitable stores by the end of 2010 to refocus itself.
The Dallas-based company is struggling to deal with the likes of Los Gatos-based Netflix and the Redbox kiosk machines, which rents DVDs for $1.
Blockbuster has long been reacting to both Netflix and Redbox's leads. The mega chain started an online movie renting system years ago to compete with the popular Netflix, which recently expanded its inventory and began streaming movies directly to users' computers and Tivos.
Recently Blockbuster also announced it was taking aim at the pesky Redbox system -- which is quickly developing a love-hate relationship with Hollywood -- by introducing its own kiosk rental machines across the country. Whether the moves will be enough to close Blockbuster's $39.7 million second quarter losses is something the industry is finally starting to study.
First Published: Sep 15, 2009 12:49 PM EDT on NBC Bay Area
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