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Posted
Sep 16 2009, 01:16 PM
by
Minyanville
Rating:
Money Blog: Top Stocks Blog - MSN Money
This article is written by Minyanville's Mike Schuster
Years of mismanagement, increased competition, and ill-conceived promotions have caught up to Blockbuster (BBI). On Tuesday, the company announced plans to close 810 to 960 underperforming locations -- an amount that doubles the previous aim of 410 to 450 stores -- in an effort to stave off the increasing likelihood of Chapter 11.
In addition the shuttered locations, the company said it may revamp 250 to 300 existing stores into used DVD outlets, bringing the total percentage of closed or altered Blockbuster locations to 24% to 29%.
The last few years have been rough for the once-great king of rental video. Netflix (NFLX) has ushered people away from the brick-and-mortar shops to the ease of online rental membership. And Redbox (CSTR) kiosks have been the popular choice for those who need a DVD title for a paltry $1/night fee.
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Posted
Mar 03 2009, 11:16 AM
by
Kim Peterson
Rating:
Money Blog: Top Stocks Blog - MSN Money
 Nothing like a bankruptcy rumor to demolish a share price. Blockbuster (BBI) has hired lawyers to look into a possible bankruptcy filing, Bloomberg reports. Shares plunged 77% Tuesday to 22 cents before trading was halted.
Late Tuesday, Blockbuster said it was exploring a corporate restructuring, and not a bankruptcy.
The movie-rental chain has been hit hard by Netflix (NFLX), which has been firing on all cylinders for years while Blockbuster struggled to find a strategy for the future. On some days, it went after Netflix with guns blazing, but other times it pursued other ideas, such as its bizarre attempt to buy Circuit City last year. Blockbuster has 7,500 stores worldwide, and hasn't wanted to cannibalize its retail sales with a by-mail DVD effort (It has a by-mail offering, but has wavered on how heavily to promote it). But the video-rental industry is hurting, despite Blockbuster's many attempts to try to lure people back to stores with in-store kiosks and other offerings.
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Posted
Jul 25 2008, 09:56 AM
by
Kim Peterson
Rating:
Money Blog: Top Stocks Blog - MSN Money
Netflix shares are up 3% today after reporting a decent quarter that beat what analysts had been expecting. One tidbit I found interesting was that the company truly did manage to do more with less -- getting more subscribers even after cutting its marketing budget by 11%. Netflix signed 168,000 new customers in the quarter for a total of 8.4 million. And that's after cutting marketing by $5 million. A year ago, the company lost 55,000 customers during the quarter. Netflix doesn't get all the credit; rival Blockbuster has backed away from pushing its online rental service lately, giving Netflix a bit of a free ride.
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Posted
May 29 2008, 11:38 AM
by
Kim Peterson
Rating:
Money Blog: Top Stocks Blog - MSN Money
Netflix CEO Reed Hastings expects the DVD-by-mail business to peak in five years. That's the main reason the company is focusing on set-top boxes that stream video directly to the TV set. Investors tread carefully: Hastings' comments are more evidence that this is a company in the middle of a huge transition to a riskier, more competitive future. One growing threat to the company comes from Redbox, which offers $1 DVD rentals at kiosks in grocery stores and other locations and is a popular choice with this blog's commenters. Redbox is majority-owned by Coinstar and plans to file for an IPO soon. Netflix would be smart to partner with Redbox, offering customers another way to get movies between DVD mailings.
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Posted
May 29 2008, 10:41 AM
by
Kim Peterson
Rating:
Money Blog: Top Stocks Blog - MSN Money
Blockbuster will introduce new dust collectors in-store kiosks that let customers download movies directly to media players. But they don't work with the iPod. Those kiosks will get about as much attention in the store as a "You, Me and Dupree " DVD.
Ratcheting up the odds of disaster is the fact that Blockbuster will have limited movies to offer at the kiosks. The company is still negotiating with Hollywood about licensing films for the trial. Blockbuster shares are down slightly today to $3.28.
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Posted
May 20 2008, 10:43 AM
by
Kim Peterson
Rating:
Money Blog: Top Stocks Blog - MSN Money
 Today we're seeing the future of Netflix. The company announced its $100 set-top player, available now and getting all kinds of frothy reviews (Wired calls it "just shy of totally amazing"). Hook the box to your TV and your wired or wireless high-speed Internet connection, and you can stream videos from Netflix's library.
Before we drill into the details of this thing, note that Netflix shares rose nearly 4% today, but closed up 2% to $31.63. Netflix shares have enjoyed a good run over the last year as the company grew subscribers and beat out Blockbuster in the DVD-by-mail business. But mailing DVDs has always been a short-term play. Now, we're seeing what Netflix wants to be when it grows up.
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Posted
May 09 2008, 10:07 AM
by
Kim Peterson
Rating:
Money Blog: Top Stocks Blog - MSN Money
Blockbuster wants to buy Circuit City for $1.3 billion, but just about everyone has chalked up this proposal as ridiculous because Blockbuster doesn't have that kind of cash. Good thing the company has Carl Icahn in its corner. The billionaire investor -- and Blockbuster's largest shareholder -- said he'll buy Circuit City himself if Blockbuster can't cough up enough money for the $1.3 billion deal. With an offer like that on the table, Circuit City has stopped giggling and is starting to seriously think about the deal. It's hired Goldman Sachs to help it explore options. Circuit City reminded everyone today that it hasn't made any decisions yet, but one thing is clear. this electronics chain is in play. And investors couldn't be happier; shares are up 9% today. Blockbuster shares are down slightly.
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Posted
Apr 25 2008, 06:19 AM
by
Kim Peterson
Rating:
Money Blog: Top Stocks Blog - MSN Money
Netflix shares had run up 78% from mid-January -- a considerable accomplishment helped along greatly by Blockbuster's ongoing struggles. But the stock price tanked this week, with investors acting the way my cats do when the vacuum is turned on. Instead of enjoying the good news (a solid first quarter, a big subscriber increase and a virtual lock on the DVD-by-mail market), investors overreacted and dumped Netflix over the bad. Netflix lowered its full-year profit projections, partly because it's spending more to build out a service that streams movies over the Internet. The company will also start charging more to customers who want to rent high-definition Blu-ray discs. Gross margin dropped more than 4%
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Posted
Apr 14 2008, 12:19 PM
by
Kim Peterson
Rating:
Money Blog: Top Stocks Blog - MSN Money
Does one loser plus one loser equal a winner? Not in the case of Blockbuster, whose offer to buy Circuit City is being met today with near-universal derision and head-scratching. The video chain, which has been in a losing battle with Netflix, has offered as much as $1.3 billion for Circuit City. That's more than a 50% premium to Circuit City's closing stock price on Friday. Blockbuster wants to combine the companies into a chain that would sell portable devices, DVDs and other content. Circuit City investors are understandably thrilled by the potential marriage. Shares of the company soared 28% today to $4.98. The electronics chain has been exploring sale possibilities, and this kind of premium is attractive. Blockbuster investors, on the other hand, are not happy: shares dropped nearly 11% today to $2.79.
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Posted
Apr 10 2008, 12:36 PM
by
Kim Peterson
Rating:
Money Blog: Top Stocks Blog - MSN Money
Blockbuster is feeling the love again in its love-hate relationship with the Internet, and this time I think the company is serious. The Hollywood Reporter says Blockbuster is making a set-top box for streaming movies to TVs, and could announce the service this month. The device would be tied to Movielink, the online movie service for PCs that Blockbuster bought last year. It's an ambitious move for a company that has never figured out the Internet. Blockbuster has bumbled around while Netflix, Amazon, Microsoft, TiVo and others found ways to marry video and the Web. Blockbuster went guns blazing after Netflix two years ago, pouring money into its DVD-by-mail service before deciding to pull back and retrench. Now, Blockbuster is making some smarter moves. For one thing, it's actually doing something with Movielink. And by offering a streaming box, it avoids the messy license and DRM issues that come with a downloading service. But Blockbuster faces some real problems, which may be why its stock price only rose less than 2% on the news today.
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