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Blockbuster Inks Distribution Deals With Sony and Fox

7 Apr, 2010 By: Erik Gruenwedel

Blockbuster said it signed new DVD/Blu-ray Disc distribution agreements with Sony Pictures Home Entertainment and 20th Century Fox Home Entertainment.

The new agreements (announced late April 6), along with last month’s deal with Warner Home Video, will provide day-and-date availability of new-release movies, deeper copy depth and better pricing for Blockbuster's store, by-mail and video-on-demand (VOD) channels.

Blockbuster, which also offers new release VOD titles for rent on recently launched T-Mobile HTC HD2 mobile phones, thereby remains the only multichannel home entertainment retailer offering new release movie rentals on street date.

The deals do not affect Blockbuster Express kiosks, which are being financed, distributed and stocked through a separate license agreement with NCR Corp. The Duluth, Ga.-based kiosk manufacturer acquires all content through distributors and third-party retail — not Blockbuster.

By contrast, kiosk leader Redbox must wait 28 days for Warner titles and secure Fox titles via third-party retail channels. Redbox is paying Sony hundreds of millions of dollars to secure the studio’s new releases on street date.

Netflix, which recently inked a deal with Warner that included a 28-day delay on new-release rentals, is thought to be negotiating revised deals with other studios.

To help secure its deals, Dallas-based Blockbuster provided Fox and Sony a first lien on its Canadian assets.

“These positive signs of studio support are part of our overall recapitalization effort to drive top-line performance while reducing debt and operating costs at Blockbuster,” said CFO Tom Casey. “This affirms our strong and collaborative business relations with these critical vendors."

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