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Blockbuster's Bankruptcy is Imminent  Print E-mail
Home Theater News Industry-Trade News
Written by Dick Ward   
Friday, 13 August 2010

It wasn't long ago, just back in 1985, that Blockbuster first came on to the scene.  Within ten years the company became a seemingly unstoppable force in the home rental arena.  Now it looks like Blockbuster's going to be filing for bankruptcy.

In July, Blockbuster was officially delisted from the New York Stock Exchange, which is never a good sign for a business.  Recently they extended a debt deadline and then warned that the company may have to liquidate.

Analyst Michael Pachter of Wedbush Morgan says that Blockbuster just can't compete with its current operating model.  Getting movies sooner, it seems, is not enough.  "Most consumers are motivated by price, are generally unaware of a DVD’s street date, and are likely to discover availability when visiting their local Redbox kiosk, rendering the 28-day head start inconsequential over the long run," he says.

Edward Wood, also of Wedbush, agrees, stating that "If they would have been able to avoid bankruptcy, it’s likely they would have been able to come to a recapitalization already."







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