Streaming online videos and mail-order delivery of DVD rentals from Netflix and similar services recently pushed Blockbuster into Chapter 11 bankruptcy. No matter how Blockbuster tried to compete with Netflix, nothing was working.
The video rental company first opened its doors in 1985 and, while they dominated the market for decades, the advent of the Internet and streaming video threatened to destroy it. They tried marketing in various ways to compete with mail delivery DVD and streaming video services by allowing customers a choice to receive DVDs by mail or in-store and temporarily suspending late fees. In the end, nothing seemed to work. Blockbuster customers were leaving in droves and signing up for Netflix services. Blockbuster rental locations all over the country were shutting down. It looked like the end for Blockbuster, until dish network showed up.
In April, 2011, Dish Network absorbed Blockbuster in order to offer a superior service to its users and those who aren’t fully satisfied with Netflix. With Blockbuster @Home, the popular satellite TV company offers Internet streaming and DVD delivery services of over 100,000 titles.
Dish’s Blockbuster purchase means more for subscribers than the services offered by streaming video services like Netflix. While Netflix offers streaming movies, TV shows, documentaries, and more (in addition to home DVD delivery), DishNet subscribers can get a similar service as well as their TV service in a discount package bundle, offering a great value to their customers. This could mean steep competition for Netflix and an unexpected revitalization of Blockbuster's name and reputation.
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April 19th, 2012 at 5:30 PM
Dish did not “bought up Blockbuster to save it from bankruptcy” as Blockbuster entered chapter 11 bankruptcy protection in September 2010.
“The merger between the two entertainment companies.” This is a misleading statement, as the two companies, Dish and Blockbuster, never merged. Instead, Dish purchased Blockbuster’s assets via a 363 asset sale in April 2011. Blockbuster Inc. still exists as a shell company, and it’s equity, BLIAQ.PK and BLIBQ.PK, still trade despite the shell company having no assets or business operations. For the purpose of clarity, the shell company has stated that it is winding down its business affairs and will eventually convert from chapter 11 to a chapter 7 liquidation.
“This could mean steep competition for Netflix and an unexpected rebound for Blockbuster.” This statement needs to be clarified. A rebound in the Blockbuster assets that you mentioned, like Blockbuster@Home, would benefit Blockbuster LLC, which is a wholly owned Dish subsidiary, and not the Blockbuster Inc. shell company with no business operations.
April 24th, 2012 at 2:43 PM
@Dr Ornstein – Thank you for pointing out those errors. The post has already been edited by the author.