After spending millions on ads, Blockbuster loses 28 day advantage

Showing 11 comments

1. sinned103 at 6:23am 30th December 2010 Blockbuster raped to many people on their late charges they deserve what they got, I would never go back even if it was free. Long live Netflix!
2. FreeMoveez at 8:32pm 24th December 2010 I have a new headline for everyone: "uTorrent + kickasstorrents.com makes Blockbuster, Red Box, and Netflix obsolete overnight" har har har
   1. Cabled at 10:46am 28th December 2010 In the same way that saying 'Robbing banks makes holding down a steady job obsolete overnight!:, yes.
3. Anthony at 6:08pm 24th December 2010 I would also like to add that the delay can't be helping netflix. I've had at leapt 10 people come into my store who said they cancelled their netflix account because of the delay. These people also signed up for blockbuster online or the in store pass. If this is happening in most stores then that's close to 30,000 members netflix lost just in the past few months alone.
4. Anthony at 5:55pm 24th December 2010 Even after taking Netflix out of the title the article is still very misleading.
5. moviemogul at 3:17am 24th December 2010 In addition, Netflix just raised the price on their by-mail service; their current venue for newer movies, excluding those "unimportant" titles like "The Town," "Inception," "Despicable Me," "The A-Team," "Wall Street," and "Salt." These blockbuster titles, combined with this month's other smaller releases have made December 2010 a month where $1.3 billion in box office titles are being released to DVD-the highest in nine years. While not having these titles does save Netflix money in revenue sharing payments. But it begs an important question. How much money and how many members is Netflix losing by not having the hottest titles during the most lucrative initial release period? What Mr. Swasey fails to mention is that with their price increase, the cost difference between Netflix and Blockbuster's Total Access service is negligible, yet Blockbuster offers all those titles Netflix is "saving millions" on when people want them (that would be on the day of release). Blockbuster also has a larger library of titles, offers games (Netflix doesn't and doesn't plan to offer), Blu Ray (Netflix charges extra) and the instant gratification of in-store exchanges (no waiting for Netflix to receive your returned movie before sending another) ALL AT NO ADDITIONAL CHARGE. Now which service would you choose? Why not ask the nearly half-million new Total Access members Blockbuster has acquired in the last two quarters with only minimal (for now) in-store advertising? Mr. Swasey might want to take a look at his latest member retention statistics. Sure, Netflix got the jump on Blockbuster due to poor management decisions in the past, but I think we all know how the story of "David and Goliath" ends. All this being said, I would strongly encourage Mr. Van Camp to review the material from his journalism ethics classes, check his facts before publishing another article and become the kind of responsible writer the public deserves. Finally, for those of you who haven't yet seen the updated Blockbuster ad, it's posted on YouTube. In addition, Blockbuster just wrapped principle production of a follow-up ad. Look for it all over your TV in the very near future.
6. moviemogul at 3:16am 24th December 2010 Mr. Van Camp, I have to chuckle at your so-called update below: "Update 12/23/2010: Made minor changes for clarity, including noting that the commercial, while part of a continuing campaign, is several months old." You fail to mention that your "update," as you call it, changed your earlier libelous statement of "One wonders how much this campaign (now a lie) has increased rentals at the struggling chain" to "One wonders how much this campaign has increased rentals at the struggling chain." Hmmm...what's missing in the "update?" Let's see. Could it be the words "(now a lie)" which would have left you open to a lawsuit? Also, the last time I checked, none of the major studios release multi-million dollar motion pictures directly to DVD. Why? Because, they're out to make as much money on a film as possible. So, after the "first run" and "gutter run" in the U.S., they release the movie abroad. Europe is a huge market for American films, and often times turns a U.S. "flop" into a money-maker. Only after they've squeezed every possible dollar out of theatre showings, which generate the most revenue, do they focus those final marketing dollars on the DVD release. It's the icing on the cake, so to speak. On a final note, I would ask you to examine two additional pieces of your irresponsible and biased article: 1. “Movie studios have Blockbuster where they want them–they know Blockbuster is not in any position to negotiate because of their financial position. The studios are getting huge payments for new releases from Blockbuster because they know the company needs them.” First, why would the movie studios cut off other distribution channels (and the revenue sharing payments they could obtain from them) unless they knew they would make more money over the long-term by partnering with Blockbuster (relationships that have been grown over the last 25 years) and ensuring they continue to remain a viable business opportunity? Second, Blockbuster does not make "huge payments" for new releases. The Company only pays approximately 25% of the rental fee to the studio and only for the first 180 days of the title's release. In addition, Blockbuster's 28 day window partners often supply the Company with numerous additional copies of the film at no cost. Their rationale: more copies=more rents=more revenue. It's a win-win situation. 2. In fact, Steve Swasey, VP of corporate communications at Netflix, said the 28 day delay has helped the streaming company immensely by saving it millions. “We actually went proactively to the studios several years ago because the 28-day model is really good for us–we recommended it,” said Swasey. “We’re even talking to other studios about it.” Do you honestly believe Mr. Swasey's statement, which was obviously written by Neflix's PR department? How exactly does NOT having the newest releases available help Netflix, which is already starting its move to a streaming-only business? They now offer a streaming-only program (which is nice if you want to watch older titles you've already seen and don't mind not being able to get TV shows like "The Sopranos").
7. Tyler at 11:08am 23rd December 2010 This is a terrible article if it is that far off. This article should be removed.
8. anthony at 1:39am 23rd December 2010 Good point. I also find it funny how he posts a commercial that is 6 months old and says that it's the commercial that their running, when it's not. If you see one of the commercials their running now, they make it very clear. In store, by mail, or by download. The title of the article is also "Blockbuster loses its 28 day advantage over netflix". How is that true when the Blockbuster online has movies like The Town, Inception, Despicable Me, The A-Team, Wall Street, Salt, and others, when Netflix doesn't have it? I'm sorry but Jeffery do some research before making horrible articles like this.
9. MovieMogul at 1:55pm 22nd December 2010 Anthony, You are absolutely right. Mr. Van Camp obviously knows very little about Blockbuster and appears to know even less about media law. His statement "One wonders how much this campaign (now a lie) has increased rentals at the struggling chain" is undeniably libelous since it makes false statements about the Company and it's plethora of recent strategic moves. Blockbuster has deliberately never offered its "28 day window" titles through rental kiosks, as it drives traffic into the Company's stores. Blockbuster's Total Access program, which is far superior to anything Netflix offers (thousands more titles available-including all "28 day window" titles, games and Blu Ray at no additional charge), also gives members free in-store exchanges of Total Access mailers, again designed to drive traffic into stores. It should also be noted that Netflix just hit their members with a price increase of up to $3/month, which makes Blockbuster's service even more appealing. Blockbuster is currently testing inclusion of "28 day window" titles in its rental kiosks in select markets. The initial rental of these titles costs approximately $3 for the first day and $1 a day thereafter, since the Company does pay a revenue sharing premium to the studios on these movies. One might also want to ask Mr. Van Camp the following question. If Blockbuster's "Why Wait?" advertising campaign is ineffective (as he implies), why have Walmart, Best Buy and Redbox recently spent millions copying it, using the EXACT same verbiage as Blockbuster? In one year, Blockbuster has installed nearly 10,000 rental kiosks in prime locations. At this rate, they will surpass Redbox's number of kiosks by the end of 2011. In addition, the Company has significantly increased its by mail subscriber base (known as Total Access) in the third and fourth quarter of 2010 by offering entertainment options the competition can't match (i.e. games, Blu Ray and in-store exchanges at no additional charge). Further, Blockbuster has increased the size of its digital department dramatically and now offers on-demand streaming of the newest movies and TV shows on over 100 devices (Netflix currently only offers older titles and doesn't offer popular shows like "The Sopranos" and "Deadwood"). While Blockbuster is certainly not out of the woods yet, the Company is on the right track. Although it's true Blockbuster will be closing unprofitable stores in saturated markets (approximately 180, according to documents filed with the court), the Company has already budgeted for, and will begin remodeling existing stores in the first quarter of 2011. Blockbuster's largely tenured group of store employees are also part of this remodeling project. They have been empowered and given the tools necessary to provide the kind of exceptional customer experience you just can't get from a "red" box or mailer.
10. anthony at 12:43am 18th December 2010 This only applies to the kiosks. You can still get all the titles through the mail service, or in store. It says in the ad provided by mail, in store, or download. The ad never says anything about the kiosks. So it doesn't lie. Do some research or just watch the video you posted before making up articles like this.