Featured Articles

AMD Never Settle Forever bundle hits 200-series cards

AMD Never Settle Forever bundle hits 200-series cards

AMD’s Never Settle bundles have been around for a while and the community response has been extremely positive. When AMD launched…

More...
AMD shipping Beema APUs

AMD shipping Beema APUs

According to Lisa Su, SVP & GM, Global Business Units at AMD, Beema notebook parts have started shipping to manufacturers last…

More...
IHS teardown reveals Galaxy S5 BOM

IHS teardown reveals Galaxy S5 BOM

Research firm IHS got hold of Samsung’s new flagship smartphone and took it apart to the last bolt to figure out…

More...
Galaxy S5, HTC One M8 available selling well

Galaxy S5, HTC One M8 available selling well

Samsung’s Galaxy S5 has finally gone on sale and it can be yours for €699, which is quite a lot of…

More...
KFA2 GTX 780 Ti Hall Of Fame reviewed

KFA2 GTX 780 Ti Hall Of Fame reviewed

KFA2 gained a lot of overclocking experience with the GTX 780 Hall of Fame (HOF), which we had a chance to…

More...
Frontpage Slideshow | Copyright © 2006-2010 orks, a business unit of Nuevvo Webware Ltd.
Thursday, 12 August 2010 10:27

Blockbuster could go bankrupt

Written by David Stellmack


Forced to make changes to survive
Despite the announcement that Blockbuster will start offering video games as part of its postal rental model, the company is still apparently in deep financial trouble. This follows Blockbuster being delisted by the NYSE in early July.

Blockbuster has made a number of moves since the delisting, including getting a forbearance agreement to delay a reported $42 million in interest payments. Now, the company is going to need additional extensions to recapitalize in order to avoid filing for actual bankruptcy. Creditors are said to already be pushing for Blockbuster to accept a Chapter 7 filing.

The pressure and change from the traditional retail rental model into a number of other models has not translated well for Blockbuster. The company was slow to adapt to changes, including cheap kiosk rentals, postal rental and streaming media. The company is finally engaged in all three of these, but is apparently not very successful at any of them yet.

Analysts that we have spoken with expect Blockbuster to announce the closing of more retail units, a bigger push on the postal rental business, continued growth in the kiosk rental business, and aggressive growth in the electronic/streaming business as their plan moving forward. It might be hard, however, to close many of the retail locations, according to those we spoke with, due to long leases with no ‘out’ clauses.

No matter, it appears that anyway that you look at it things are going to be tough for Blockbuster; and they have a tough road ahead with a lot of changes of they are going to return to profitability again.

David Stellmack

E-mail: This e-mail address is being protected from spambots. You need JavaScript enabled to view it
blog comments powered by Disqus

To be able to post comments please log-in with Disqus

 

Facebook activity

Latest Commented Articles

Recent Comments