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Blockbuster's Offensive Against Netflix Flops 302

bigtallmofo writes "With over four million subscribers, Netflix was an obvious target for rival Blockbuster. In 2005, target them they did. Introducing their own DVD-by-mail service and (for a while) undercutting Netflix's price point, Blockbuster went for the jugular. A year later Netflix shows a market value of $1.5 billion with no debt compared to Blockbuster's $684 million worth with $1.0 billion in debt. Is there still a DVD-by-mail war or has Netflix won?"
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Blockbuster's Offensive Against Netflix Flops

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  • by Chris Bradshaw ( 933608 ) * on Sunday December 25, 2005 @08:28PM (#14337494)
    Not to bring the whole "throttling" thing into this, but it really seems that the war now is between Netflix and themselves. If they can keep from shooting themselves in the foot again, i.e., lawsuits [], etc... Then theoretically, They shouldn't have anything to worry about(considering their market share). I can say from personal experience that they are trying to protect and keep their existing user base, and are quite apologetic when called on it now. I am currently enjoying a a free month + two months at half price after calling them on it. Bottom line is this, they both obviously have deeper personal issues to deal with... I'd say the war is on temporary hold until they can both get their crap together
    • by OrangeTide ( 124937 ) on Sunday December 25, 2005 @08:33PM (#14337505) Homepage Journal
      DVD-by-mail is neat and will overtake DVD rental at a brick-and-mortar location in the near term. But the DVD-by-mail industry (which consists of mainly Netflix now) is going to have a fight on it's hands when video "rental" over the network takes off. (maybe 2007Q1?)

    • by iPaige ( 834088 ) on Sunday December 25, 2005 @08:36PM (#14337517)
      Netflix as a corporation has many lawsuits, but their out there with no real basis to start off on anyhow. These plantiffs are suing because the DVD's arent there in "one-day" always. Isn't that the postal services fault? Also because not all the plans were "unlimited rentals", well did ya really think the 7 dollar plan was gonna be the same as the 20 dollar plan? I mean, come on.
      • by rolfwind ( 528248 ) on Sunday December 25, 2005 @10:36PM (#14337859)
        I think it's their fault for advertising it when they know the postal service doesn't deliver it within a day (I don't believe the postal service guarantees or implies 1 day service.)

        However, despite the nonreality of the 1-day service, I have no problem recommending them. When I used to have their service, I intended to cancel with them before going on a 7 month trip to Europe (mostly because of a lack of anime in their inventory at the time....). Apparently I didn't, when the person keeping my finances in order gave me the CC bills^_^;;;;; - one phone call later, without being put on hold, they gave me my money back in short order without hassle (because there was no account activity) and with still being friendly.

        I think the only thing that might occur within the next ten years is that Netflix's current business model will become obsolete (like Blockbusters) due to bittorrent downloads (and if the studios start offering legal ones).
        • I think it's their fault for advertising it when they know the postal service doesn't deliver it within a day (I don't believe the postal service guarantees or implies 1 day service.)

          USPS's fastest shipping option is Express Mail, which is overnight to two-day service (depending on the origin and where you're sending it to) with a money-back guarantee. I haven't seen Netflix's advertising but if they note that proximity to a Netflix warehouse is the primary factor in delivery time, then there's no false

      • The plaintiffs were probably a bunch of people with "lawyer friends" who never bothered to read the sign on the mailbox that said "last pickup 10am/3pm/5pm" and expected to be able to drop their movie in the mailbox around 10pm and have the next one delivered with the next day's mail. While there are limits to "unlimited rentals" they're understandable limits, there is no maximum number you can rent each month, you can rent as many as you can in 30days, the number depends on how fast you watch and return th
      • ...well did ya really think the 7 dollar plan was gonna be the same as the 20 dollar plan? I mean, come on.

        It's called fraud when you sell one thing and deliver another.

        Had Netflix sent a letter out to their customers saying "We have to cap the number of DVDs you can rent on plan Y to X per month. If you want to see more than X DVDs then we have these upgrades available," the suit wouldn't have had any basis. However, Netflix advertised they offered "unlimited rentals" on their least expensive service whe

    • by raehl ( 609729 ) <raehl311 AT yahoo DOT com> on Sunday December 25, 2005 @09:47PM (#14337724) Homepage
      I need to become a lawyer. This lawsuit rocks!

      - Sue a company for something they didn't really do wrong in the first place
      - Negotiate a "Settlement" that's really a marketing campaign for that company
      - Pocket massive legal fees!

      Did anyone read this settlement? If you sign up for it, you get a free month of a one-level upgrade of Netflix service. Then, and here's the cool part for netflix...


      What kind of "penalty" is that? Trade a couple rentals to get your customers to upgrade packages? That's cheap advertising is what that is!
      • I wrote a blogpost about the Netflix settlement [], where I named the law firm. A few weeks back I got a vaguely worded threat from the lawfirm - left as a HaloScan comment - with a number to call, etc.

        I spoke to a pro bono lawyer who handles stuff for another website I run, and she advised it was fluff, but recommended I take the name of the firm down, as apparently the BIG firm was using a SMALL firm as a front in the lawsuit, and thereby could claim misrepresentation, lost business, etc.

        'Nuff said - the
  • Netflix... (Score:5, Insightful)

    by lasmith05 ( 578697 ) on Sunday December 25, 2005 @08:29PM (#14337496) Homepage
    I think Netflix is too entrenched to be taken out by another company. However, I do think faster broadband and downloadable (legal) movies like those available on itunes are going to slowly chip away at netflix.
    • by SethJohnson ( 112166 ) on Sunday December 25, 2005 @08:35PM (#14337515) Homepage Journal

      Netflix has already partnered with Tivo, which already has tivo-to-go that works for the video iPod.... potentially they're ready to roll-out downloadable movies...

    • The Netflix executives aren't stupid--you can bet that they have contingency plans for getting into the downloadable content market. Whether they can pull it off is another question.

      iTunes may have a lead in this area, but Apple also has big hurdles to overcome to make a good business out of this; a lot of 320x240 downloads isn't going to cut it.
    • Well, the US is 5% of the population, and perhaps 20% or so of the economy. Most of the potential market is wide open, and cultural and business differences are large enough that it's unclear if there is an advantage to already have a functioning business process elsewhere to start from (or if that even creates a change adversity that is a sum negative).

      I really wonder to what degree it really is possible for any one company to dominate the world market in most culture- or society-related products anymore.
    • Netflix would already be doing DVDs online if it weren't for the fucking movie industry's bass-ackwards views on digital technology. The deal with TiVo is basically out - Netflix cant negotiate a reasonable deal with the movie industry to allow people to rent DVDs online and have them downloaded to a TiVo box. There is nothing we can do about it until the movie industry either gets investigated by congress (the only real way to make an industry move nowadays) or someone with much closer ties (like what Appl
  • The Red Envelope (Score:5, Insightful)

    by oGMo ( 379 ) on Sunday December 25, 2005 @08:36PM (#14337518)

    Yeah a number of people might subscribe to Blockbuster's deal. It might suit them fine. But in this case, Netflix has won the mindshare. Blockbuster is the video store on the corner, and well-established at that; but on the internet, Netflix is the common word. The red envelopes are signature. They've won the highly-important mindshare game, and they appear to be winning the business game, too.

    Sure, there are always advantages of one over the other. Blockbuster has instant gratification---I can get the movie I want within minutes. Netflix has wider selection---I can't walk into a BB and find much anime. They also have convenience---I decide on a movie, I can click it and it'll be there tomorrow. And I can procrastinate and watch it when I feel like, returning it when I want. And it's cheaper than the corner store if I watch a lot of movies.

    I can't really speak to BB's online service; they might have similar selection and pricing, but they also have the same disadvantages. And after dealing with Netflix ("oh, the movie never came? here, we'll ship you another free of charge") vs Blockbuster ("oh, you returned the movies in the morning, but we didn't notice til after noon... that's $6 please"), I would definitely rather do business with the former.

    • I can't really speak to BB's online service; they might have similar selection and pricing, but they also have the same disadvantages.

      I tried blockbuster for a short time. Their website was ugly and busy compared to Netflix'. But what got me to cancel was the fact a search for Star Trek Voyager showed all seasons except for season 3 or 4 -- can't recall exactly but there was absolutely no way I could find any discs for that season no matter how I tried searching. Either their search engine really suc

    • While it's not a perfect service, I've generally been okay with Blockbuster Online. And I can say for sure that if the movie doesn't show up in a timely manner, you can have them ship another. It's automatic. They don't complain, try to talk you out of it, or make insinuations about your character, they just ship the next movie. If you end up with an extra, you just ship it back. Due to the flaky nature of the mail, I think this is necessary for any business working this way, even if it may sometimes b
    • > The red envelopes are signature.

      Don't forget, that in the very begining, the envelopes were actually yellow.

      Also, when Shrek brand movies come out, they seem to turn green!
    • "The red envelopes are signature."
      They can also be a nice big red, or yellow&blue, target for anyone who might want to "borrow" some of your movies. I say borrow because it once took two weeks for BBOnline to update the status of two of my rentals, I sent all three back on a Mon morning, Tues one was received and the other two weren't. I contacted support before reporting them returned but not received. Their status remained sent by BB for a few weeks.

      "I can't really speak to BB's online service; they m
  • The Jugular? *snork* (Score:4, Informative)

    by deacon ( 40533 ) on Sunday December 25, 2005 @08:39PM (#14337531) Journal
    With what, a floppy rubber claw? Foam rubber teeth?

    I've stress tested both. Netflix was able to push out 9 movies a week for 6 weeks, and then throttled down. Blockbuster managed 4 movies a week, for the less that a month I kept them.

    Now I just borrow what I want from the library system. Reserve online, get it all pulled and sent to a library near where I am during the day. No limit on the number of DVDs I take out.

    Based on my Blockbuster experience, I would not even consider them again.

    • by Spokehedz ( 599285 ) on Sunday December 25, 2005 @10:07PM (#14337780)
      The only problem I have with the library is that the DVD's are usually scratched... which means that I have to watch them on my computer. Which is not my 52" TV with surround sound. So I usually end up copying the movie, burning it to a DVD, and watching it on my TV... Which unfortunately breaks so many laws, it's a shame.

      Well... There is geexbox... but I really want my remote control...
  • by HardCase ( 14757 ) on Sunday December 25, 2005 @08:41PM (#14337539)
    Market value and debt don't really tell enough. Earnings and cashflow are bigger tools to gauge the success of the companies. If Blockbuster is making enough money to service the debt (and other obligations), then they're doing fine. If Netflix has enough cash reserves that they don't need debt to keep operating, then they're doing fine. Debt is just a tool that businesses use.

    • by wfberg ( 24378 ) on Sunday December 25, 2005 @09:29PM (#14337674)
      Market value and debt don't really tell enough. Earnings and cashflow are bigger tools to gauge the success of the companies.

      How about some good old-fashioned "profit"? (And we'll have none of the EBITDA crap either!). A quick look at the charts on Yahoo reveals a $603.30M loss.

      Inexplicably their market cap is also about $600M, with a $1200M debt. Now, I have a debt that's more than my income or savings, sure, but it's a mortgage, so my creditors can sell my house and reclaim the money. If they sold the company in parts, assuming that strip-raiding it adds 25% in value over market cap, that still leaves $450M in bad debt.

      Of course, it might be that all debt is really from one division (say, the DVD posting division) that they're looking to get rid of. But still, things look pretty bleak, seeing as that debt isn't doing anything right now, and their last investment pretty much failed. This kind of company is usually propped up by their creditors to salvage what potential is left.
  • by wmajik ( 688431 ) <> on Sunday December 25, 2005 @08:48PM (#14337556) Homepage Journal
    I used Netflix when they first came out, as I thought it was a very novel idea and one worth trying. It worked great until I ran into the same problems that everyone else did - delays with new movies, being pushed into the far reaches of the queue and other inconveniences. I quit Netflix due to their growing pains, but didn't have a ton of animosity toward them. Having been in the business world, I understand that sometimes you can shoot yourself in the foot with success when demand exceeds capacity.

    Recently, I was given a Netflix subscription again and noticed that they've gone through substantial upgrades, added new features and have none of the same queue problems that I exeprienced before. To me, this shows the maturation of the company, because they have the resources now to meet their customer base, given that they are now a very profitable company with the means.

    I don't think Blockbuster is going to go kaput over the issue, because there will always be people who prefer a brick and mortar video store or you'll have an occasion where you can't wait a few days in the mail for a video. For this, Blockbuster is king. However, the cost of running a B&M operation like Blockbuster far surpasses an online only entity like Netflix, where store space, rent, maintenance, employees and the like are no longer issues. This means that Netflixs' margins are simply leaps ahead of what Blockbuster could even hope to achieve in their wildest dreams.

    So can Blockbuster compete with Netflix? I think the answer is on the walls to everyone. I think this is exactly why Blockbuster tossed everything (and the kitchen sink) against Netflix, because they saw the picture and it didn't look pretty.

    Do I think Blockbuster is going to bite the bullet? Not at all. Do I think Netflix will take a giant cut of of their market and force Blockbuster to resign itself to a B&M only operation with limited expansion abilities? Very much so.
    • From the looks of the local Blockbuster here they are at best about 18 to 24 months from going out of business. At least as a movie rental operation. They appear to be reinventing themselves as a game rental outlet. I doubt it will be enough to save them.

      But from what one of the managers said they are about to go out of business. I suspect that Netflix was not the the only reason for Blockbuster to be in decline. I find that buying the DVDs I want to watch is not that bad at the local wholesale club
      • It doesn't matter what store will replace the Blockbuster up the street.

        The declining rentals and used movie purchases will compel the MPAA to whine about further lost sales on account of P2P piracy. See? It drove that Blockbuster Video out of business!

        No matter what replaces that outlet, you know what will be blamed. it is a lose-lose situation, and you already know who wins.
      • "As such I no longer have a desire to rent DVDs"

        I can appreciate that, but buying DVD's even at Costco is about $14-16 a pop. That's still pretty expensive; that's about $60/month to watch 4 movies. It might be cheaper to pay for HBO/Max/Showtime and get a couple dozen movies for about $25/month.
  • Netflix has been very good to me, I bought the stock at about $10 and now its at $27. However, with good video on demand coming soon I have to wonder if NetFlix has a future. I doubt that Netflix could compete with the likes of Apple and Google when it comes to video on demand. I'm very curious to hear whether Slashdotters have abandoned their Netflix accounts in favor of services such as Comcast's OnDemand and would you prefer a download service to NetFlix?
    • That's exactly what Netflix is concerned with. They beat Wal-Mart AND Blockbuster in the online market. But the execs at Netflix are concerned with the content-over-broadband market. They view that as their primary threat.

      Rupert Murdoch's DirecTV will begin delivering content from Murdoch's empire, and anything else they can get their hands on, over the DirecTV lines to their DVR, both as trickle download and OnDemand.

      Comcast is working on OnDemand.

      And then there is the Netflix-TiVO-Comcast arrangement, in
    • As the old saying goes 'never underestimate the bandwidth of a station wagon full of magnetic tapes'. In this case it can be updated to 'never underestimate the bandwidth of a bunch of DVDs in the mail'. Netflix's days are numbered so long as bandwidth continues to increase. They've probably got a good few years yet though until they are overtaken, especially if HD disks become popular; demand for higher quality should give their delivery system better bandwidth than online connection for some time. In the
      • especially if HD disks become popular

        This is going to be the big thing; My Comcast-provided on-demand programming is wonderful - for SD content. I've only had a problem with it once (movie broke up and stopped). DVDs aren't immune from issues either.

        But once we start talking HD in some sort of volume, HD-on-demand is probably not going to scale very quickly. Having an early collection of HD discs will convince me to resubscribe to NetFlix (assuming I get an HD DVD player)

    • I think downloads are the only thing that will kill Netflix at this point.

      They have options. They can run their own download service. They can brand another (OnDemand featuring Netflix) or sell theirs out (DirecTV Downloads provided by Netflix). But there are still problems with downloading (bandwidth for most people), and watching (sorry, I want to watch on my TV and I don't want to hook up my Mac to it). However, if they set up a download service right (like caching stuff from my queue onto my TiVo for m

      • I think there are several years in netflix as well. Bandwith is not here for dvd quality movies yet. Especially when geeks are switching to voip and other things that suck their max bandwith down. As of now, I couldn't support a phone call, my wife playing WoW and downloading a movie at teh same time on my 3mb charter cable modem package.
        • I couldn't download on my 1.5 Mb Comcast cable because it never runs near it's full speed.

          This is why the TiVo type device is so critical in it. The TiVo or whatever downloads during off hours (which I guess you could specify). By doing this, it could still get things to you faster than the post office (especially since it could download things you shouldn't be able to watch yet, then "turn them on" when you "return" previous things). Plus, because it it caching it to watch later instead of streaming it st

  • by Stubtify ( 610318 ) on Sunday December 25, 2005 @09:00PM (#14337590)
    Blockbuster's 2 free rentals a month are sweet; I used to use them for video game rentals (which are now $7 each at my local store).

    That said, with all of the comments on which service is better I'd like to weigh in on a few specific points:

    First, each service does a good job of what you want it to. Keep a large quantity of movies queued up and they show up in the order you want and you've always got something to watch. Look into who has a better catalog of what you like to watch and stick with them.

    Second, each service FAILS when you use it to the limits. I've heard people saying they average 18-23 movies a month with netflix/blockbuster. 18-23 movies!!@?? That's WAY below a dollar a movie, and don't forget shipping back and forth (at least $.60). The idea here isn't to scam the company into a loss on you, the idea is to use a service and have a reasonable good time using it.

    Now, I'm all for fairness in advertising (i.e.: unlimited should mean unlimited) but don't complain when you only get 15 movies in one month, for $17. And ESPICIALLY don't complain to me when I know that the majority of the people who are doing this crazy 8 movies a week thing are simply burning every movie right when it comes and then shipping it back the next morning. It is all but impossible to watch three movies a night three nights a week. That is SURELY not what these services were meant to be. You're raising my rates, and it's totally illegal as well.
    • Hello its slashdot. Its the people Kurt Cobain was writing about when he wrote Smells Like Teen Spirit. The want everything for free except for the stuff they do, then they want paid for that. So much for my Karma.
    • by jp10558 ( 748604 ) on Sunday December 25, 2005 @10:59PM (#14337930)
      I'm sorry, but 18-23 movies isn't even one movie a night. And there are at least some users (like my DAD) who are retired, and like to have something to do during the day when everyone else is at work/school/out whatever. The 5 out a month barely supplies enough to keep him in stuff to watch unless he gets the TV series discs which have ~5hrs of content, so 2-3 days per disk rather than one for movies.

      And for many rural people (who seem to be a large market segment) we don't get much over TV, and the quality is random - sometimes quite snowy. Also, like many others I prefer no commercials, so I like to watch DVDs of a show vs broadcast. And watching one TV episode a night can eat up the slack (I mean, with several people in a household - you might need 2 discs at a time, due to different tastes and more than one TV/DVD player in a house).

      So the idea that 18-23 DVDs a month is for piracy is certainly not necessarily the case, especially for a household of 4. Now if you are a single guy with a full time job, and you're doing that you either have no life beyond work and DVDs, or you are pirating them as fast as you can.

      But there are many reasons you could turn around 18-23 DVDs in a month as listed above. Especially if one family member (if not all) are somewhat TV addicted(not unusual in the US).
    • The lawsuit wasn't taking issue with not being able to get tons of movies. The lawsuit was objecting to Netflix increasing its turnaround time for specific customers based on high usage. If Netflix is working flat out to get people their movies, there's no problem. Once they start deliberately slowing their service down, they're in breach of contract (or false advertising, or however you want to phrase it).

      I'll bet Netflix is still making money on the people getting 20 movies a month. I assume they prio
  • by Cherita Chen ( 936355 ) on Sunday December 25, 2005 @09:03PM (#14337599) Homepage
    For those of you who think that $videoBymail vendors will suffer when Video-on-Demand hits the market, think again. You need to remember that quite a few folks out there that are building up impressive home video libraries thanks to services like Netflix and Blockbuster.

    Couple unlimited rentals with the ability to download the jacket [] to any movie ever made... Well I'm sure you get the point.

  • started with netflix for obvious reasons. switched to blockbuster because the allure of getting a couple free in-store rentals each month was tempting (there is a blockbuster a few blocks from me in DC). also, blockbuster seems to have more titles available than netflix.

    however, the simplicity and robustness of the user interface from netflix is extremely superior to blockbuster. ratings are much better. watching trailers and reading reviews is easier.

    also, there are more categories in netflix. i like to wa
  • by supabeast! ( 84658 ) on Sunday December 25, 2005 @09:11PM (#14337623)
    Blockbuster still has one ace up its sleeve - porn. Most of the mom-and-pop shops that survived Blockbusters intense expansion did so by renting and selling hard-core porn. That option is certainly a tough one for Blockbuster, as many franchise owners will object, but for the corporate locations it may be the only option to keep them open.

    Of course, this wouldn't kill Netflix - it would just turn Blockbuster into the world's largest chain of sex shops. But being a chain of sex shops is a better option than going bankrupt.
  • I have a Blockbuster account. The killer feature with Blockbuster Online is the two free store rentals each month. We queue up all the obscure titles in the online queue (ever seen "Children of Heaven" from Iran, or "Primer"?), and get popular stuff at the store.

    The thing that tempts me to switch to Netflix is their bigger selection (while both collections are growing, Netflix consistenly has about 10000 more). They have lots of BBC titles (including BBC Shakespeare performances on DVD) that Blockbuste

    • I've had a NetFlix acct for quite some time. I tried BB for a month, to see how it compared, and switch if it was better. Even with the 2 free/month, NetFlix was a better value. Faster, bigger selection, better UI.
      At one point, I had occasion to send back 3 each on the same day. Netflix had a new one to me before BB had registered receiving two of them.

      I dropped BB after the intial month.

    • Thanks - I just added "Children of Heaven" to my Netflix queue.

      I've used Netflix for years now, and can't do without, especially the wide selection. The further comfort I have with online commerce (Amazon Prime, eBay,etc.) makes me prefer well-run online options
      I am, however a miniscule part of the huge non-online customer base of Blockbuster. It's surprising they could make a loss with such a comfortable, non-technical population
  • by Mean_Nishka ( 543399 ) on Sunday December 25, 2005 @09:18PM (#14337642) Homepage Journal
    I switched from Netflix to Blockbuster's mail service last year and haven't yet felt the need to switch. I'm still on the original $14.95 pricing plan for three movies out at a time. Yes, Blockbuster's UI is inferior, the selection might not be as vast, and it might take an extra day or two to receive a flick over Netflix, but the real deal are the coupons.

    Blockbuster gives two in store coupons every month good for a game or movie rental. With their game rentals hovering in the $8 range, it pretty much pays for itself every month. Blockbuster also credits the value of the coupon against the 'keep it' price for any video or game rented at the store. Good deal (for me at least).

    • But is the coupon a real incentive to stay if the prices are outlandish to begin with? $8 per game rental is a bit excessive to say the least, especially in light of other online offerings like Gamefly. Point being, if you rely on the BB's coupons for your subscription to be worth it, then you've really missed the point.
  • Death to Blockbuster (Score:3, Interesting)

    by MBCook ( 132727 ) <> on Sunday December 25, 2005 @09:34PM (#14337686) Homepage
    I used to like them. For movies, they can't hold a candle to Netflix's selection, etc in their brick and mortar stores. I don't know about their online service, but Netflix is great (there is a distribution center within about 40 miles of me so my turnaround is very fast).

    But I don't like blockbuster. We'll ignore all the scratched discs and such that the stores would give me (almost no problems in that way from Netflix). I recieved 2 broken discs from BB in about 3 years of renting, compared to 1 in 2 years at Netflix. And if you consider how you get the discs, that doesn't look too good.

    But what are their prices now? I'll ignore the "2 day rental" scam they run on popular movies. They used to be $4 for everything. Now they are like $6 for a movie and $8 for a game. EIGHT DOLLARS TO RENT A GAME. I also enjoy how they sell anything you keep out too long to you. That is how their no late fees program works. You can reverse the charge within 30 days and pay a restocking fee, but the fact they don't advertise this fact in that no late fees campaign ticks me off.

    Mostly it is the price raises that they keep doing. If it wasn't for video games (I don't get enough time to play them to make Gamefly worth my while otherwise I would HAPPILY subscribe) I wouldn't go near the place.

    So, from my point of view, here is what happened:

    • I left BB because their service/selection was terrible
    • I joined Netflix
    • I found I LOVED Netflix
    • BB Gets mad they are no longer the big-cahoona in town
    • So they make a competing service and expect people (who all seem to hate them as much as me) to switch from a company they love (Netflix) or no mail rentals to BB's mail rental service
    • People either laugh at them or ignore them
    • Netflix proffits.

    Never tried BB's program. Never thought of it. I'm surprised it lasted this long. Is Wal*Mart still doing this, no, they sold out to Netflix didn't they?

    That's right, WAL*MART FAILED. Surely BB could do it where WAL*MART couldn't.

    I've only talked to 2 people who tried BB's program. They both (former and current Netflix subscribers who tried it because of the price) said the selection was worse, the availability was worse, the turnaround was worse. Only the price was better.

    And at $2 a month (wasn't that the difference?) no one cared. Netflix later dropped their rates in response anyway, IIRC.

    Time to die BB. You're like Radio Shack and Toys R Us. You are not even a shadow of your former self. You're a dead man walking. You can try to switch industries (like RS did) and stay as a bit of a joke (and with their GameRush crud, this looks like their plan), or slowly wither and die (like Toys R Us is doing).

    Long live Netflix. They (along with TiVo) have completely changed the way I watch TV. They have a great price for the service, and only continue to impress me.

    • by egburr ( 141740 )
      I can tell you have had some pretty bad experiences with Blockbuster, but ...

      That is how their no late fees program works. You can reverse the charge within 30 days and pay a restocking fee, but the fact they don't advertise this fact in that no late fees campaign ticks me off."

      The very first time I heard about the "no late fees" my first thought was "there has to be a catch". Bo on their website and in their stores, every ad or pamphlet I picked up had fine print describing exactly what would happen an

      • by MBCook ( 132727 )
        Yes, it was in the fine print as always. I just find disgusting that their solution to late fees is to just sell you the movie instead of charing you.

        I have kept a movie too long and had to "sell it back" and pay the $1.25 restocking fee (or whatever it was). If that part didn't exist, I would be thoroughly sick. My family is terrible about returning things on time also (but, that was how they made almost all their money). Even if you waited too long to "sell it back" (30 days after they "sold it to you"),

  • What could give both of them a run for their money is PeerFlix.

    See: []
    • I looked at PeerFlix briefly, but it had a LOT of issues. I can't remember what they were but either cost or wierd terms or something drove me far, far away when I looked at it... pretty sure it was the cost. You seemed to have points that bought things and it took a lot of points to get things that were not "Pooch & Turner" level movies. There seemed to be a lot of overead fees for a company that got people to mail things to each other.

      It's a cool idea but I don't think PeerFlix is going to be the c
  • Tried both at the same time awhile ago and noticed that Netflix just served you better. Had faster turn-around times, Netflix did pretty much most of the time actually send you your top 3. Blockbuster would jump around more, which was kind of annoying. Also with BlockBuster I felt that they did not see, sure about this model (hope that makes sense, it was awhile ago and the specifics allude me, maybe it was just an impression they left).

  • by Anonymous Coward
    Blockbuster has probably only ever regarded Netflix as a minor pest. You all are seriously misjudging the size of Netflix's business by looking at market value. Blockbuster is doomed and bleeding money, but still pulls in 10x Netflix's revenue. Only three or four years ago, Blockbuster was still collecting a billion dollars in late fees per quarter or something like that.

    No, Blockbuster's latest moves -- mail rentals, changing late fees, rental subscriptions -- have all been lame attempts to fend off a m
    • by metamatic ( 202216 ) on Monday December 26, 2005 @12:14AM (#14338144) Homepage Journal
      Blockbuster is doomed and bleeding money, but still pulls in 10x Netflix's revenue.

      Let's see... A billion dollars of revenue and big losses, or a tenth of the revenue and millions in profit...

      Netflix is for people who know what they want to watch in advance and watch a ton of movies.

      Or people who want to watch their movies uncensored. Or people who care about video quality, and don't want to pay out the ass for HD. Or people who actually like the extra material found on DVDs. Or people who feel they already pay too damn much money to the cable company, who keep jacking up their fees every quarter, unlike Netflix.

  • Netflix (Score:3, Insightful)

    by the eric conspiracy ( 20178 ) on Sunday December 25, 2005 @10:27PM (#14337829)
    I've stopped buying DVDs because I don't want to re-buy once HD DVDs become available - Netflix is a terrific alternative to building your own video collection.

    I have had some annoyances with Netflix though - damaged (out right broken or cracked DVDs) are about 15% of what I recieve, and sometimes I have to wait several days to get a movie from across the country. But all in all it is super convenient compared to the alternatives, and very inexpensive for what you get.

    I suspect that Netflix is in a great position now because it would cost a heck of a lot of money to start up a competitive service.

    • I've stopped buying DVDs because I don't want to re-buy once HD DVDs become available

      I don't want to re-buy when HD-DVDs become available either. That's why I'm still buying DVDs.

      That is, when HD-DVDs become available they will be so crippled with DRM I won't want to buy them. DVD is quite good enough with a good upconverter, so...

  • We use Nexflix. Never even considered Blockbuster as an option. YMMV.
  • Hollywood Video (Score:3, Informative)

    by akac ( 571059 ) on Sunday December 25, 2005 @10:34PM (#14337850) Homepage
    We stopped using both Netflix and Blockbuster. BB because of its insane fees and costs, and Netflix just because renting a movie for us is an impulse action. Instead we use Hollywood Video. Its cheap. Quality. And I can find nothing that BB does better.
  • Blockbuster edits the movies they rent.

    If a movie has scenes that are offensive to the ownership of Blockbuster ( usually sex, they don't seem to have a problem with violence, go figure ) Blockbuster reserves the right to edit that scene out of the movies they rent.

    While they will admit to it if asked directly, they will not advertise it in their stores.

    Apparently telling the truth (fairly representing their products) values of Blockbuster's owners.
  • by Ingolfke ( 515826 ) on Sunday December 25, 2005 @11:02PM (#14337939) Journal
    Before any DVD you want will be either available on demand over the Internet, or available for immediate burn at your local blockbuster (or kiosk). A Coke Machine sized vending machine could easily store hundreds of DVDs and have a high speed connection to the Internet to download more of them as needed. Why not order a pizza and have a DVD of your choice delivered w/ it? Netflix idea fits a niche right now, but I don't think it's viable over the next 5-10 years.
  • I've tried both (Score:3, Interesting)

    by pajor ( 310214 ) on Sunday December 25, 2005 @11:43PM (#14338073) Homepage
    I've tried both Netflix and Blockbuster online rentals. I had netflix for a long time and quit them when they raised their prices from 14.95. Later on I signed up with blockbuster because they were cheaper. Blockbuster raised their prices too, but they were slick about it and gave me a free used dvd coupon with it. I stick with blockbuster because I find their selection to be perfectly adequate (I've never had trouble renting something I wanted, maybe I'm just incredibly mainstream), and because I find the two free instore rentals indispensible. It's nice as a movie junkie to have a big queue of movies coming to watch stuff, but sometimes you need a movie for a date or something and having two free in store rentals is awesome. I use them every month. Also you can get video games with them.

    I think if blockbuster leveraged it's brick and mortar more, they'd cut into netflix's market share quite a bit.
  • by krunk4ever ( 856261 ) on Sunday December 25, 2005 @11:56PM (#14338103) Homepage
    I had a discussion with a friend sometime ago and I had some suggestions on what Blockbuster could do to have save more money and make customers more happier.

    Offer customers both the option of sending it back by mail or returning it back to a local store. That's an advantage of having a local store in almost every city which Netflix doesn't. Of course, if convenience is your thing, you're still allowed to drop it in your mailbox and have the postal service ship it back. But by offering both return methods, both parties will benefit from the user returning to the store. The user's queue will be emptied by the following day (instead of waiting ~3 days for the mail to be delivered and scanned), therefore that means more movies per month. Blockbuster saves money by shipping all the dvds back to the central office together, saving on shipping.

    Another feature they can offer customers is the option to allow the subscriber to have 1 dvd out from the local store at any given time. They can even subtract that 1 dvd from the # of dvds they can have out at a time. They can even restrict it to 3+ months old movies, where if the subscriber wants to watch newer movies, they'll have to go through the online store. I mean, every Blockbuster has a bunch of movies that hardly ever circulate much. There's really no point in letting them sit there to collect dust. By allowing users to have access to the local store, this will make them happier and actually give those old dvds some worth in the store. Sometimes you might want to watch a movie that night, but neither netflix or blockbuster would fix that. If the 1 dvd out at a time is too much, you can restrict it to x dvds from local store / month.

    Just my 2 cents.
  • "Is there still a DVD-by-mail war or has Netflix won?"

    That's a dumb question. What major market for any product has only one supplier (besides government)? There's room for both and more. Must be a slow day at Slashdot to put this up front...
  • by sTalking_Goat ( 670565 ) on Monday December 26, 2005 @02:13AM (#14338504) Homepage
    Blockbuster was at a disadvantage from the get go. I bet a large percentage of Netflix's first customers were disgruntled Blockbuster customers, so they didn't have a chance of getting those people back. I'll not be unhappy to see Blockbuster close up shop. Netflix et al will get the mass market and the Mom and Pop Brick and Mortars will cover the specialty market and everone (mostly) will be happy and (mostly) un-ripped off.

"Let every man teach his son, teach his daughter, that labor is honorable." -- Robert G. Ingersoll