Dish Network bids for Blockbuster at the last minute before the bidding deadline.
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Very interesting indeed. Here's to hoping that they close the doors of all of the B&M stores and integrate the service into Dish.
What would they do with Blockbuster? I can't see them operating what amounts to a less expensive competitor to their satellite business. They could close all the B&M locations and continue the kiosks and mail distribution services, but they would still be competing with Redbox, Netflix, and themselves. Perhaps it is an admission that cord-cutting is real, and they are trying to broaden their offerings before their satellite business starts to permanently erode.
I think they would close the remaining stores and create an online streaming service for Dish Customers only. Although as I'm writing this, it wouldn't make sense since they already have Dishonline.com
But how many people have heard of dishonline.com as opposed to blockbuster? I can see paying for the name. At that price, I don't know, unless they can get the agreements to show movies without the 30 day lag that Netflix has right now along with the name.
Blockbuster may also have licenses from content providers that Dish lacks, plus perhaps a distribution system.
We don't know how much it is costing Dish to provide the content on it's DishOnline service, as it really seems from a 3rd party. It may be cheaper in the long run to bid for Blockbuster for its streaming service that Dish will own and have the Blockbuster name. Also, as mentioned, blockbuster seems to have more licenses for more TV series than found on DishOnline. I can't see Ergan wanting any of their stores. I think this is all about the streaming content, and Dish desperately need to be far more competitive on that front.
I think Charlie sees the writing on the wall for satellite TV. All satellite service business model is quite costly to deliver the content. In the case of the online distribution, they just need the licenses and customers. Blockbuster (online service has that. I don't see DishNetwork keeping the B&M stores but I do see Charlie seeing a quick and easy way to acquire a bunch of customers for an online service. Satellite TV companies need to evolve to stay profitable. With broadband becoming ubiquitous in the next few years, who will sub to Dish at $120 per month when they can get their content for under $20 a month. a la Netflix, Hulu and other PPV services.
The studios that licensed their content to Netflix for on line streaming failed to anticipate how quickly the demand for streaming video would grow and how quickly the sale/rental of DVDs would fall.
When they renegotiate the contracts you can be sure they will want more money making impossible for Netflix to continue offering unlimited downloads for a low fixed price.
Content owners have all the leverage. If Netflix and its customers won't pay what the studios want then there is nothing stopping them from setting up their own streaming services.
Jim
When they renegotiate the contracts you can be sure they will want more money making impossible for Netflix to continue offering unlimited downloads for a low fixed price.
Content owners have all the leverage. If Netflix and its customers won't pay what the studios want then there is nothing stopping them from setting up their own streaming services.
Jim
This is very interesting.. I think all the Blockbuster stores here in Southwest Alabama have been closed for a long time. This has to be about the streaming capability..
After checking I see there are 2 stores within 22 miles of me still open.. Guess that means new Dish Stores helping put more nails in the coffin of the retailer.
After checking I see there are 2 stores within 22 miles of me still open.. Guess that means new Dish Stores helping put more nails in the coffin of the retailer.
I thin someone posted earlier that really wants the agreements Blockbuster has with the major studios. With that in place, Dish could really beef up it's VOD offering as well as use BB's network of movie distribution. I would bet that's What Charlie is really after.
DISH Network Agrees to Acquire Blockbuster Assets
ENGLEWOOD, Colo., April 6, 2011 /PRNewswire/ -- DISH Network Corporation (NASDAQ: DISH) announced that it was selected as the winning bidder in the bankruptcy court auction for substantially all of the assets of Blockbuster, Inc. DISH Network's winning bid was valued at approximately $320 million. After certain adjustments are made at closing of the transaction, including adjustments for available cash and inventory, DISH Network expects to pay approximately $228 million in cash to acquire Blockbuster at the closing which is expected to occur in the second quarter of 2011.
"With its more than 1,700 store locations, a highly recognizable brand and multiple methods of delivery, Blockbuster will complement our existing video offerings while presenting cross-marketing and service extension opportunities for DISH Network," said Tom Cullen, executive vice president of Sales, Marketing and Programming for DISH Network. "While Blockbuster's business faces significant challenges, we look forward to working with its employees to re-establish Blockbuster's brand as a leader in video entertainment."
Completion of the transaction is contingent upon satisfaction of certain conditions, including bankruptcy court approval.
Safe Harbor Statement under the U.S. Private Securities Litigation Reform Act of 1995:
Except for historical information contained herein, the matters set forth in this press release are forward-looking statements. The forward-looking statements set forth above involve a number of risks and uncertainties that could cause actual results to differ materially from any such statement, including the risks and uncertainties discussed in DISH Network Corporation's Disclosure Regarding Forward-Looking Statements included in its recent filings with the Securities and Exchange Commission, including its annual report on Form 10-K. The forward-looking statements speak only as of the date made, and DISH Network Corporation expressly disclaims any obligation to update these forward-looking statements.
ENGLEWOOD, Colo., April 6, 2011 /PRNewswire/ -- DISH Network Corporation (NASDAQ: DISH) announced that it was selected as the winning bidder in the bankruptcy court auction for substantially all of the assets of Blockbuster, Inc. DISH Network's winning bid was valued at approximately $320 million. After certain adjustments are made at closing of the transaction, including adjustments for available cash and inventory, DISH Network expects to pay approximately $228 million in cash to acquire Blockbuster at the closing which is expected to occur in the second quarter of 2011.
"With its more than 1,700 store locations, a highly recognizable brand and multiple methods of delivery, Blockbuster will complement our existing video offerings while presenting cross-marketing and service extension opportunities for DISH Network," said Tom Cullen, executive vice president of Sales, Marketing and Programming for DISH Network. "While Blockbuster's business faces significant challenges, we look forward to working with its employees to re-establish Blockbuster's brand as a leader in video entertainment."
Completion of the transaction is contingent upon satisfaction of certain conditions, including bankruptcy court approval.
Safe Harbor Statement under the U.S. Private Securities Litigation Reform Act of 1995:
Except for historical information contained herein, the matters set forth in this press release are forward-looking statements. The forward-looking statements set forth above involve a number of risks and uncertainties that could cause actual results to differ materially from any such statement, including the risks and uncertainties discussed in DISH Network Corporation's Disclosure Regarding Forward-Looking Statements included in its recent filings with the Securities and Exchange Commission, including its annual report on Form 10-K. The forward-looking statements speak only as of the date made, and DISH Network Corporation expressly disclaims any obligation to update these forward-looking statements.
Blockbuster doesn't operate any kiosks. Those are fully-owned by NCR - NCR simply licensed the Blockbuster name. Think about it, who would people want to rent movies from, NCR or Blockbuster ?
As for closing all remaining stores, personally I think that some B&M stores can and should remain. Fact is, BB has or had way too many. At one time, within a 10-min (city) drive of my home, I could get to 9-10 BB stores !! A large number of people still want to walk in and rent a disc. Not everyone is interested in streaming or ordering a movie and waiting 1-2 days for the disc to arrive.
