Should Blockbuster call it quits?

[Luvin Da Blues]

Beefy's on a roll today!

Should we give GB "player of the game" for his hat trick?

[Mr Peabody]

At least in my area BB don't charge late fees any more.

Why not run up $1,100.00 if no one is really going to collect it.

I'm in Rich's camp, give me the disc.

[Woochifer]

A couple of thoughts:

- Blockbuster always had shelves and shelves of the same new release. Talk about a waste of real estate. RedBox doesn't work like that, there's only one spot for the image of the new release with a healthy selection inside.

That's because when they had their revenue-sharing arrangements with the studios, they had access to literally an unlimited number of new release copies. Their stores would routinely stock 50+ copies of a new release title because the studios did not charge them the wholesale cost on each title. Competitors would have to pay the wholesale cost, and so they could not afford to stock so many copies of a new release title. Upwards of 50% of the rental market consists of new/recent releases, so this was a cash cow for Blockbuster and the shelf space they devote to specific new release titles is a reflection of the popularity/demand.

- Blockbuster's sanitizing program was a turn off for many people. A lot was said about that in years past, but I think that when a vendor tells you what to watch, that sucks.

EVERY vendor selects what to stock and what not to stock. Aside from Netflix, there's not a single video store that carries every version of every title.

What you consider a turn off, many other consumers regard as a plus. Blockbuster basically does not carry adult titles or "unrated" versions of studio pics. But, it's not like they demanded scrubbed versions (like the Cleanplay versions), and when consumers demanded widescreen DVDs, Blockbuster began carrying them.

- On the same note, Blockbuster stores would typically stock titles based on rental rates, and this was neighborhood specific. So this also furthered limited selection on the shelves, another bad idea that drove people to competitors. I remember how NetFlix used to brag about how they had better selection, back when they were starting up (perhpas that's not the case anymore).

Blockbuster's niche is the mainstream market, which is driven by new releases. Until the DVD took over the market, Blockbuster was the only video store that could guarantee a new release title's availability because of their revenue-sharing arrangements.

Netflix has a better selection because they only have to supply a small number of regional distribution centers, rather than thousands of neighborhood stores. And even then, good luck trying to get a hot new release from Netflix during the first couple of weeks. If you have a huge number of catalog titles on your queue list, this doesn't matter much. But, if you want to watch new releases right after they become available on home video, Netflix isn't the best option.

- If NetFlix is going to be the only game in town, then is that good for the disk rental industry, or more precisely, the consumer?

Nope, because for consumers who prefer instant gratification, Netflix isn't a better option.

- Who does now have the better catalog, Blockbuster or NetFlix?

Netflix has the bigger catalog, but that doesn't help if you want a movie right now.

- What about Hulu? How deep is their catalog? Can they even compete?

Different market. Hulu is NBC/Universal's free video streaming service.

- Will Blockbuster be bought out? After all, it's not just the catalog and the contracts with the studios, we're also talking about a lot of real estate.

Doubt that someone will buy it in its entirety. If they go bankrupt, someone might take a chance with acquiring specific assets. The leases would be parceled out in bankruptcy court, and someone might take over several of them, there's no guarantee that they will continue operating as video stores. It's like when Tower Records went under, several of their Bay Area leases got acquired by Rasputin Music, but several of their Southern California locations got turned into Rite Aid drug stores.

[Woochifer]

Nevertheless, all I do now is go online, browse their website for the titles I want, click a couple of buttons, and off they go. Pretty simple.

I just caught the tail end of a news story one night that indicated NetFlix is soon going to end mail order rentals. Not really a big deal one way or the other for me. :shrug:

Doubt that will happen anytime soon. Netflix's online option is still a niche service that Netflix members try out, but don't use as their primary source. As GB indicated, this seems more like Netflix offering up their online service as a standalone option.

[Woochifer]

At least in my area BB don't charge late fees any more.

They don't charge late fees, but if you keep the disc long enough it gets charged to your credit card as a purchase.

[Mr Peabody]

Wooch you reminded me of something you said yesterday and again today I wanted to comment on about BB's distribution deal. That was very significant and probably changed the face of retailers buying movies eventually. I used to work for an electronics store who rented movies to create more foot traffic back in the 80's when renting became big, some of those movies cost $80.00 or more. It took some renting to break even at that. I forget, believe it or not, what movies rented for then. That would be a huge advantage BB enjoyed for a while.

[pixelthis]

[QUOTE=Rich-n-Texas]Beefy's on a roll today! Beef, did I mention I like your new dentures? Bright & white!

Fact is, anything Dumbass suggests is probably wrong (Good LORD where are you Sir T!) so I'll continue to order my Blu-ray titles on line and have the US mail deliver them to me. Seems simple enough.

There you go, talking to yourself again.
And you're right, everything you say is wrong

[pixelthis]

Where did you read that? You realize that this edges us closer to one of Pix's predictions to actually become true: that downloading will take over everything.

its going to happen, like when Rich gets laid off and goes insane when his Viagra
runs out.
THIS is a great web site, really.
This is the ONLY place where I can post what is considered common knowledge
everywhere else on the planet and be met with redicule, brickbats , insults,
comments about my mother, etc.
Its like when a modern man drives into a middle age village and they stone him to death,
thinking his car is some kind of demon.

[pixelthis]

ONE of these days I am going to bring up this new invention...fire.
Oughta freak everybody out.

[Kevio]

And I'm not sure what ripper/writer you are using but you need a new one if you are noticing a difference between a ripped DVD and your "backup" copy. Either that, or start using Dual-Layer DVD blanks. No compression needed.

The download version has none of that. It is the movie, and in english. No audio options, although I belive the default is 5.1.

And I have a HD-DVD player, Blu-Ray Player, and DirecTV HD. Unless YOU have seen a XBOX 360 D/L I would suggest you are guessing(talking out your ass).

The quality is quite good. I'm not suggesting it's a pixel-2-pixel match. But it is hands down better than the Netflix "streams" that I can also get off the XBOX service. And it's quick, painless, and if I really enjoy the movie, I can then decide to purchase it later from Amazon or a retail store.

You are right, I haven't seen or even heard about the XBOX service and so I'm asking questions about it, doing some talking out of my ass to elicit responses. Don't take it so personally.

I'm using DVD Shrink for my ripping. And yeah, there's extra stuff on discs - some more than others. DVD Shrink breaks it all out for you and, in my experience, never really amounts to more than 25% of the disc. Titles with lots of bonus material are released as a multiple DVD set.

Based on this and what you've said, I am convinced that the XBOX HD service delivers fewer bits than a standard definition DVD. XBOX still has a chance look better if they have a significantly more sophisticated encoding algorithm than the MPEG2 used on DVDs.

I want to know how this download service compares in terms of picture and sound quality to standard definition and BluRay DVDs.

You've said XBOX is better than NetFlix streaming. You've said that the XBOX quality is "quite good" and that you have the equipment to do a comparison but you've not offered a comparison.

[Luvin Da Blues]

.....This is the ONLY place where I can post what is considered common knowledge.....

[Rich-n-Texas]

The picture speaks a thousand words LDB. Your reputation has increased in strength.

[Groundbeef]

I'm using DVD Shrink for my ripping. And yeah, there's extra stuff on discs - some more than others. DVD Shrink breaks it all out for you and, in my experience, never really amounts to more than 25% of the disc. Titles with lots of bonus material are released as a multiple DVD set..

Try 1ClickDVD Pro. I've not had compression issues like you are describing. Sounds like a software problem rather than a compression problem. I've not experienced artifacting/bad playback resolution.

But, lets assume you are correct. 25% of a 4.7GB movie is ~1.25GB. But that would only be the special features. The audio options chew up a lot more than that. Cut out all of the foreign audio, and your file is even smaller.

Based on this and what you've said, I am convinced that the XBOX HD service delivers fewer bits than a standard definition DVD. XBOX still has a chance look better if they have a significantly more sophisticated encoding algorithm than the MPEG2 used on DVDs.

I want to know how this download service compares in terms of picture and sound quality to standard definition and BluRay DVDs..

Picture quality from the XBOX service is very good. Again, there isn't artifacting/ghosting/pixelation that is quite noticable from say a Netflix download. The audio is good. It isn't "lossless" but it is surround sound.

The regular download for a SD movie is on par visually with a dvd in the player. HD quality isn't as good as a Blu-Ray at 1080p. But it is better than the SD download.

I don't think there is a difference in the audio track between a SD download or a HD download. I'm not the coding engineer, so I'm guessing on that last point.

You've said XBOX is better than NetFlix streaming. You've said that the XBOX quality is "quite good" and that you have the equipment to do a comparison but you've not offered a comparison.

Well, unless you are sitting in my living room switching between sources, I'm not sure what benchmark you are looking for. Best option would be to find a friend who has a XBOX 360, and rent a movie. It's ~$3.0 for SD and ~$4.0 for HD.

I've said it before. It isn't true HD like when I watch a Blu-Ray. However, for evaluation of a movie that I am considering purchasing, or when the wife and I decide on a whim to see a movie it is a very competent service.

I did the google, and found this comparison chart of the XBOX service versus AppleTV. It has some technical info that may be helpful for you.:
http://www.joystiq.com/2008/01/16/ch...e-vs-apple-tv/

[Auricauricle]

Pix, you oughtta be careful, bringing fire and reason to the masses....One way or another, your asp will either be stoned, burned or nailed. Mebbe some of us benighted fools actually like their thatched roofs and Super 8....Why muck up a good thing?

[Kevio]

Pardon the brief technical interlude...

But, lets assume you are correct. 25% of a 4.7GB movie is ~1.25GB. But that would only be the special features. The audio options chew up a lot more than that. Cut out all of the foreign audio, and your file is even smaller.

Movie-length Dolby digital tracks are less than 500 M bytes. I haven't seen a DVD where you'd save more than 1 G byte by deleting foreign languages. Even if there are a bunch, most of them are usually smaller 2 channel mixes. I guess you can argue it all adds up but I don't think the extras ever approach 50% of the total DVD space used.

...you may now resume trolling with Pix

[Woochifer]

Wooch you reminded me of something you said yesterday and again today I wanted to comment on about BB's distribution deal. That was very significant and probably changed the face of retailers buying movies eventually. I used to work for an electronics store who rented movies to create more foot traffic back in the 80's when renting became big, some of those movies cost $80.00 or more. It took some renting to break even at that. I forget, believe it or not, what movies rented for then. That would be a huge advantage BB enjoyed for a while.

Blockbuster's revenue-sharing arrangement killed much of the competition, because it created a totally unbalanced playing field. The wholesale cost on a VHS release would cost anywhere from $60 to $80 for most releases. Blockbuster did not have to worry about the wholesale cost, so their stores could stock upwards of 50+ copies on a new release. All they had to do was split the revenue with the studios.

One of my relatives used to own a video store, and they would rarely buy more than 4 copies of a new release because with their average rental rate of ~$3 for a two-day rental, each copy would need to be turned over at least 20X before they would break even. And generally, the demand on a new release tails off considerably after about the first couple of weeks. Last thing they (or any other indie video store) need is getting stuck with a big pile of movies that have yet to recoup their cost.

The DVD pricing structure, which went to a priced-to-sell model with a wholesale cost of around $15 per copy, put all of this to an end. Now, Blockbuster has to compete on a more even basis, which might be the main reason why they're struggling. They built their business model around the windfall that their revenue sharing deals created. That allowed them to overexpand, and build stores that were way too big. For Blockbuster, the DVD created a major cost escalation because they now had to pay wholesale cost just like everybody else. For indie stores, the DVD resulted in a dramatic cost reduction because studios no longer had a two-tiered "rental pricing" window on new releases, and they could now afford to stock more copies of the more lucrative new releases.

Now, Blockbuster has been making exclusivity arrangements with some studios that would make them the only place that can rent out certain movie titles. I recall that some Weinstein Company (founded by Miramax's former bosses) titles were available for rental only through Blockbuster. Anyone could still buy the DVDs at other retail stores, but the rental copies were only sent to Blockbuster.

On a related note, Blockbuster's decision not to stock "unrated" or porn titles probably kept a lot of the mom-and-pop stores in business. IIRC, some indie stores generated upwards of half their rental revenue from the "back room."

[nightflier]

What you consider a turn off, many other consumers regard as a plus. Blockbuster basically does not carry adult titles or "unrated" versions of studio pics. But, it's not like they demanded scrubbed versions (like the Cleanplay versions), and when consumers demanded widescreen DVDs, Blockbuster began carrying them.

Whatever it actually was in practice, it was seen as a store telling people what they could and could not watch. If as you say, the "back room" accounted for as much as 1/2 the revenue of mom & pop rental places, then it was probably also decision that cost them. This is not to say that BB didn't address other customer needs like widescreen, but that's a different topic, I think.

Blockbuster's niche is the mainstream market, which is driven by new releases. Until the DVD took over the market, Blockbuster was the only video store that could guarantee a new release title's availability because of their revenue-sharing arrangements.

Despite their shelves full of new releases, there were many times when these were just the cases, and the actual movies were rented out. I'm going to guess that this was actually an irritation to many people, to see shelves of the same movie cases, but not a single available title to rent.

Netflix has a better selection because they only have to supply a small number of regional distribution centers, rather than thousands of neighborhood stores. And even then, good luck trying to get a hot new release from Netflix during the first couple of weeks. If you have a huge number of catalog titles on your queue list, this doesn't matter much. But, if you want to watch new releases right after they become available on home video, Netflix isn't the best option.

I've read this complaint in many places online, but those people I know that have Netflix don't really seem to find this an issue. It eventually comes, so they don't mind waiting a few extra days. I think this complaint is over-blown.

Nope, because for consumers who prefer instant gratification, Netflix isn't a better option.

With downloads (i.e. unlimitted digital copies available), this will become much less of a problem. Granted, bandwidth on new release nights might be stressed, but that can be addressed technologically. Downloads, regardless of quality, should continue to eat away at physical disk rentals for the simple fact that people who really want to see the latest, will place a preference for the disk in the queue, and barring that will settle for the download.

Different market. Hulu is NBC/Universal's free video streaming service.

I wasn't necessarily speaking in terms of revenue, but more in terms of movies downloaded. Hulu is growing extremely fast and the ads, at least for now, are not very intrusive. Yes, the lion's share of its downloads are TV, but once people get used to it, they'll start expecting movies the same way, and eventually new releases. It's just too easy and it's free. I think they are the biggest threat to Netflix as well as Tivo.

It's like when Tower Records went under, several of their Bay Area leases got acquired by Rasputin Music, but several of their Southern California locations got turned into Rite Aid drug stores.

Looks like the SoCal, once again, drew the short straw on that one.

[Auricauricle]

Tower Records stored turing into Rite AId pharmacies.....Is that why there are so many DVD discount discs at the pharmacy?? There's a whole wall o' them....

I use Netflix. If you don't care about staying "on top" or current, itis a pretty decent service...

As far as the wall of empties at BB goes, I always thought that was just all reinforcement of an agenda to push a certain movie....Sort of an unsubliminal subliminal ad.

[pixelthis]

Pix, you oughtta be careful, bringing fire and reason to the masses....One way or another, your asp will either be stoned, burned or nailed. Mebbe some of us benighted fools actually like their thatched roofs and Super 8....Why muck up a good thing?

You're right, these guys probably would only hurt themselves.
Like the guy who keeps calling me a "dumbass" when I HAVE FORGOTTEN
more than he will ever know about anything.
Oh well, nice to see someone on this site can take a joke, anyway.

[Auricauricle]

Ni-i-i-ice....Joan of Art, right?

[Rich-n-Texas]

You're right, these guys probably would only hurt themselves.
Like the guy who keeps calling me a "dumbass" when I HAVE FORGOTTEN
more than he will ever know about anything.

You ARE a fvcking dumbass, you dumbass. The way you present your opinions, and that's all they are idiot, the way you think you're rubbing people's noses in your mind chilling predictions with your childish *I told you so* attitude when in actuality nobody really gives a rats ass what you think, is why you get the responses you do. DUMBASS.

Oh well, nice to see someone on this site can take a joke, anyway.

Yeah, we know you're only joking. So am I dumbass.

[Auricauricle]

That's it! I'm turing the car around right now!!

[Rich-n-Texas]

I don't care! I HATED going to that stupid Drive-in anyway!!!

[Luvin Da Blues]

I don't care! I HATED going to that stupid Drive-in anyway!!!

Rich, he wuz takin' ya to the dentist!

[Rich-n-Texas]

YO!

What did I tell you BONEHEADS about the white text?!?! DON'T PUSH ME!!!