Will Hollywood’s Next Horror Movie Star Blockbuster Video?
By Davis Freeberg
Slate has an excellent overview of the problems that Blockbuster Video has faced over the last several years and will face going forward. In the article they discuss the shift from a revenue sharing business model to an upfront payment model by the studios. They also mention the disasterous Enron relationship as well as the competition that Netflix is giving them.
Blockbuster can “reinvent” its store business, adding new products, such as popcorn, candy, and video games, and clone a Netflix-like subscription business, but it still has the albatross of the huge monthly rent payments from its stores weighing it down. Even if it could manage to slip out of these leases, it would still have to contend with Hollywood’s move to deliver its movies into homes and iPods via video-on-demand.
They conclude the article with a quote from an unnamed Viacom executive who said “Blockbuster will certainly not survive and it will not be missed.” It is another zombie in Hollywood.