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Blockbuster CEO Jim Keyes just did an interview with Rick Munarriz over at the Motley Fool, and boy did he come out looking like a fool with some of his comments.

First off, let me say that I have nothing against Keyes or Blockbuster in general. If they can come up with a competitive play that benefits me as a customer, I would give them some of my business, as I have in the past. But, whether they can remains to be seen.

Now, on to the interview and the quote that I think shows just how out of touch Keyes and Blockbuster is on the current competitive environment.

The quote from Keyes:

“Neither RedBox nor Netflix are even on the radar screen in terms of competition,” he said. “It’s more Wal-Mart and Apple.”

My question is: Jim, what are you smoking?

While I am certain Wal-mart and Apple pose threats to Blockbuster, to ignore actual DVD rental companies like Redbox and Netflix as competitors is foolish at best, and delusional at worst.

So, what is going on here? Perhaps Jim is trying to ensure shareholders that Blockbuster is still one of the “big boys”, so only huge corporations (like Wal-mart and Apple) can even be considered as competition. Or, perhaps he sees DVD sales and digital downloads as the real threat, not other companies in the DVD rental space. While I think he is right about those threats, they certainly aren’t the only ones Blockbuster is facing.

Some of the comments on the Motley Fool article show a different tune than the one Keyes is singing, too…

Funny stuff… Here in Denver, one of the most profitable and busy Blockbuster stores in the entire region … just closed its doors. …if Blockbuster wants its grove back, it needs to completely re-visit its pricing strategy.

Blockbuster is going out of business…

I agree with most of the other comments. DVD’s may be a slowly melting glacier, but in-store DVD rental is melting a whole lot faster than DVD rentals as a whole. To dismiss Neflix [and Redbox] as serious competition is delusional…

Check out the article to see the growing list of comments.

Other parts of the interview show that Keyes thinks the future is “in-store digital downloads”. So, he wants people to come back to his stores to put their little memory card in his kiosk and download their movies, then go back home to watch them. Isn’t there an extra step in their somewhere?

Really, if non-streaming digital movies is coming to kiosks, isn’t more likely that Redbox – with over 11,000 locations and growing – would be a better choice? How many of you have a Blockbuster store closer to you than a Redbox? I think I know the answer, as I have to pass by at least 5 Redbox kiosks to get to my nearest Blockbuster store, which is only 2 miles away.
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So what is the point of this post? If Blockbuster execs really think like Keyes has spoken here, I think many investors are about to jump off Blockbuster’s Titanic before it’s too late.
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What do you think?

It looks like Blockbuster is deciding to come to the DVD rental party again with some 99 cent rentals of their own, according to a speech given by Blockbuster CEO Jim Keyes at Reuters Media Summit on Thursday.
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Now, we don’t know which movies they will be offering for the magical sub-$1 price, but according to the Reuters article, Keyes did note that it would encompass “thousands of DVDs, including many classic older movies.”

What about new releases, Jim? Probably not going to happen unless they want to face the wrath of studios like Universal, as well.

We can never count Blockbuster out of the game, and it seems like with their set-top box, possible kiosks, and now this, they aren’t going to go down without a fight. January will be here quite soon, so we will see what they have up their sleeve shortly.

I haven’t been there in a couple of years myself, and I don’t think this will bring me back, because I currently have about 7 Redbox kiosks between me and the nearest Blockbuster.

What about you? Do you still rent some stuff Blockbuster?
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Will this get you to go more often?

Blockbuster has officially announced their set-top box today, as was rumored a few weeks ago.

The box itself, the 2Wire MediaPoint player, will be available for free with the advanced purchase of 25 (or 50?) prepaid rentals for $99. Additional rentals will be $1.99 each.

This differs from the Netflix model, which is included for free with a Netflix membership of $9/mo and up. I just signed up for the Netflix streaming to my XBox 360 so I could give it a try and see how the service was.
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I will report on this in another post soon.
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In any case, do you think Blockbuster has a chance here? I think they are too late the game, but if they can get new releases out there for $1.99, they may just have a chance. Time will tell.

Read the article here.

News coming out of Blockbuster’s conference call on Nov 6 says that they will be releasing a set-top box before the end of the year.
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Blockbuster CEO Jim Keyes made the announcement on the call, but offered no further details. You can read more at Home Media Magazine.

This is interesting news, because it may mean they are scrapping the idea of releasing kiosks to compete with Redbox. If so, this may be good news (at least short-term) for Redbox.

It does seem that long-term being able to stream movies to your TV will replace DVD rentals, but how soon is anyone’s guess.
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The question is, will Redbox release something like this, too? An interesting thought…

In a not-so-surprising move, Blockbuster – the original movie rental giant that has taken a beating recently by Netflix and Redbox – has announced that they will be placing 50 DVD rental kiosks in a pilot test they are doing.

Blockbuster previously announced their partnership with NCR – the maker of ATM machines – for the download-only kiosks they are testing in Dallas. This new announcement expands that agreement to include these new dvd kiosks.

The scary part of all of this is that Blockbuster and NCR have enough funding to enter the DVD kiosk arena with a lot of force and intensity. Check out this quote from the release:

“This alliance with Blockbuster is an exciting step for NCR as we pursue our mission of becoming the leader in the market for entertainment self- service solutions,” said Bill Nuti, NCR chairman and CEO. “Looking beyond this initial deployment, our mutual goal is to have 10,000 kiosks installed within 18 months. We are energized and thrilled to be such an integral part of Blockbuster’s strategy for providing consumers with greater choice and convenience.”

10,000 kiosks in 18 months… That is a large number and could really hurt Redbox. I wonder if Redbox had wind of this recently and that is why they delayed their IPO. News like this – especially if Blockbuster is successful in their test – could really hurt share prices in an IPO.

Anyway, read the full press release if you want the full scoop, and stay tuned for more developments on this over the next 3-6 months.

What do you think? Will Blockbuster takeover the DVD rental kiosk space and put an end to Redbox and other competitors?

Chris over at the NewTeeVee blog wrote an interesting post about the scenario of Blockbuster buying Redbox. Here is an excerpt:

Blockbuster needs to do something to juice up its business because Netflix is eating its lunch. But getting into the hardware game will be an expensive endeavor, especially in an increasingly crowded field already packed with big names like Apple, TiVo, Xbox 360, Vudu and soon the Netflix LG box.

Finally, by leveraging the existing Redbox kiosks in non-video locations like grocery stores, Blockbuster could take advantage of impulse renting. People are already used to the idea of DVDs being sold in supermarkets, this would nudge them a little further and into downloads.

While an interesting idea, I don’t think its going to happen. I left a comment there, and agreed with frequent Inside Redbox commentor Davis Freeberg: Blockbuster cannot afford Redbox.

Redbox is too valuable right now and already has more locations than Blockbuster.
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While the rent-by-kiosk space is still relatively new, it is gaining a lot of users for its convenience and low prices.

Redbox just needs a new website that is easier to use and more “web 2.0”, and they will likely be unstoppable. If anyone from Redbox corporate is listening – I know what you need to do, and am happy to share that with you, if you are interested.

In any case, what do you think: Should Blockbuster buy Redbox? Should Redbox let them?

I personally think there is a better combination, and I will post about that soon…
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