Things aren't looking great for Blockbuster
. The company, which was
arguably one of the most well-known movie rental outfits in the entire
world, hasn't had the greatest of years ever since Netflix came into
existence. For years, driving out to the nearby movie store for their
nightly fix wasn't too much to ask. But as soon as by-mail became an
option, suddenly the drive out felt like a huge inconvenience.
Netflix was grown consistently over the past few years, and at the same
time, Blockbuster has seen fewer and fewer customers enter their stores.
Blockbuster even tried the by-mail approach, but it was after Netflix
grabbed the majority of those interested in such a service. Furthermore,
offers something that Blockbuster doesn't: Watch Instantly.
This allows Netflix subscribers with plans of $9/month or more to watch
unlimited streaming films and TV shows from their PC or a variety of
televisions or set-top boxes. That's a huge value-add, and Blockbuster
has thus far been unable to create any acceptable substitute. Or at
least one that people will pay attention to.
Over the July 4th weekend, the company has found itself fighting for its
own freedom. Freedom from debt. The company has recently won approval
to stay just one step ahead of bankruptcy, but it's only a one month
reprieve on debt payments. Still, it was forced to delist from the New
York Stock Exchange, which is a massive fall from grace. Once companies
are forced to delist, it's a hard road back to recovery. In fact, most
companies either fold or put themselves up for sale rather than attempt
to pick up the pieces and start over.
Now, those holding around $440 million in debt have agreed to lay off
until August 13, though some analysts suggest that even the month won't
help Blockbuster to recover. Michael Pachter, analyst with
Securities, had this to say: "Six weeks is not a long time in a tough
economy, where nobody has much credit. There's nothing on the horizon that makes it
look like Blockbuster is going to be more profitable."
It's hard to think that Blockbuster will ever be half the company it
was, but could it shift itself enough to just stay alive? Who knows, but
we're all hoping it doesn't follow the same path as the once-mighty