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Today’s Blockbuster story comes from the good news/bad news file.
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The bruised and battered rental giant and its partner NCR have added 100 new Blockbuster Express kiosks in Arizona. The company has also announced the resignation of influential billionaire Carl Icahn from its board of directors.

Blockbuster Express Kiosks

Blockbuster’s partner in its kiosk venture, NCR, recently installed more than 100 new BB Express kiosks at Food City and Bashas’ supermarkets in Arizona. This puts the grand total of BB Express kiosks at about 4,000—less than a fifth of Redbox’s 22,000 installed boxes.

Carl Icahn Resigns

Icahn stepped down after a tumultuous term on Blockbuster’s board that saw the company’s share price drop from around $10 to less than 50 cents.  Many are seeing the timing of Icahn’s resignation as a harbinger of things to come for the once-mighty Blockbuster.

Edward Woo, an analyst with Wedbush Morgan Securities, was surprised at Icahn’s resignation, as the billionaire owns a sizeable percentage of Blockbuster’s Class A and B shares. Woo said the following regarding Icahn’s stake in the company and the situation Blockbuster finds itself in:

“You would think that he would still care a lot. . . Given the recent pre-announcement by Blockbuster, the potential bankruptcy again of Movie Gallery, and the strength of Redbox and Netflix, things are looking rather tough for Blockbuster,”

Insiders, does Icahn’s “rats leaving the sinking ship” resignation move the Blockbuster death clock another minute closer to midnight? Will BB’s expanding kiosk business be a case of too little, too late? Let us know what you think in the comments.
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(via ABC News and Home Media Magazine)

9 Responses to “Blockbuster Adds Kiosks, Loses Major Board Member”

  1. Visitor [Join Now]
    Mike [visitor]

    Hard to say for sure, but if he starts unloading stock in the next few weeks, pay careful attention.

  2. Visitor [Join Now]
    Carson [visitor]

    I don’t understand why a BB Kiosk has “Love Happens” on the day of release for $1/day and Redbox is not able to get it.
    I stopped to look at a BB kiosk today and they get all their new releases right away, how does that happen without the big 3 studios throwing a fit?

    • Visitor [Join Now]
      tinybrat [visitor]

      Its because blockbuster gets their movies shipped to their stores and puts them into kiosks. Their stores still get shipments from the studios.

  3. Visitor [Join Now]
    tinybrat [visitor]

    For what its worth, my local redbox had love happens in it this evening and i’m watching it now…

  4. Member [Join Now]
    Cypherdude [cypherdude]

    Between Netflix renting all the hard-to-find movies and Redbox in nearly every major supermarket, I don’t see how the B&M Blockbusters can survive. They want $4 per rental plus you have to make a special trip just to get the movie. The only way most people can afford them is to use their “Favorites” program (if it still exists). I haven’t been with BB for 2 years. I just got through renting 2 later releases from Redbox for FREE!

    I have a feeling Blockbuster will replace many of their stores with larger sized kiosks which have a larger selection of movies than regular sized Redboxes. They can call them “Premium” or “Deluxe” kiosks.

    BTW, I was NOT able to rent Amelia from Redbox Tuesday 2/2 even though 2/2 was supposed to be the release date. They told me it will be delayed until Saturday. Because I can get it FREE I don’t mind the delay. Plus, I don’t rent that many movies anymore (not enough time).

  5. Visitor [Join Now]
    Thurston Howl III [visitor]

    Actually, NCR is responsible for obtaining the movies since they own and operate the kiosks. Blockbuster just gets a royalty.

    I can only assume NCR is forced to do a work around also. With fewer machines, they can buy any movie. Once they get to critical scale, the 28 day window will effect them.

    That is why this industry may just sell out to one big player.

    And who would the best buyer be? I believe a consortium of Hollywood studios since they can argue there are tons of different distributions points ie Brick and Mortar, Netflix, On Demand, Other Kiosks, Borrowing from friends or library etc.

    And then, if the consortium was smart, it would secure long term contracts with their retail partners and then raise rates.

    In short, they would get the same economics as when they were getting revenue share with Blockbuster. In addition, they could data mine their customers which is what they always wanted to do.

    Think about it, once they know who their customers are, have their credit card numbers, have their email and know their purchasing habits, they could totally grow that into a big business.

    Redbox is going to do $1.2 billion in revenue in 2010 by renting out $1/night dvds. Hollywood could raise all prices to $2 and load the machines with Blu Ray discs to justify and not alienate all customers.

    Then they could directly sell disks out of each machine.

    They could offer coupons for other merchandise.

    This could have leverage over Netflix who is one of their biggest customers.

    They could stop complaining and get into the business of actually knowing their customers and meeting their needs as opposed to promoting red carpet events to aspirational people.

    • Visitor [Join Now]
      Firstlawofnature [visitor]

      Studio consortium would surely screw up the strong consumer focus Redbox has. I think it needs to be a neutral owner to preserve the natural tension between content and distribution. Yes there is too much tension between Hollywood and the Chicago boys right now. Any new owner that wasn’t trying to please the sheeet out of customers would mess it up. Protecting some other divisions profits is not currently a concern at the box.

  6. Visitor [Join Now]
    slidecage [visitor]

    100 boxes are nothing if what a manager told me (they hope to have 4000 more out by end of year)