Keyes: Blockbuster Streams Better Than Netflix20 Nov, 2009 By: Erik Gruenwedel
Blockbuster chairman and CEO Jim Keyes Nov. 20 said he eagerly anticipates the day when consumers with Internet-enabled devices and televisions are confronted with the option to either stream movie rentals from Blockbuster or Netflix.
Speaking to an investor group in New York, Keyes said Blockbuster consumers wanting to stream the new Star Trek release would be able to do so, unlike Netflix, which primarily streams older catalog fare. He said Netflix, due to existing license agreements, wouldn’t be able to stream the title for three to five years.
“If you want to watch Star Trek on [Blockbuster On Demand], you just push the button and in seven seconds you are watching the movie,” Keyes said. “If you are a Netflix customer [and do the same] only then do you discover you are [actually] watching Star Trek II: The Wrath of Khan.”
The Dallas-based No. 1 DVD rental chain has partnered with Samsung, TiVo and Motorola to offer Blockbuster movie rental streams through a variety of consumer electronics and portable devices.
The CEO said the burning question among investors and analysts continues to involve the fate of Blockbuster’s 5,300 stores worldwide (as of Oct. 4) in the face of changing consumer options for movie rentals.
Blockbuster earlier this year said it would shutter nearly 1,000 underperforming stores through 2010, with some earmarked for closure possibly morphing into lower-rent Blockbuster Outlet stores focused on selling used product. Keyes said the remaining stores would evolve into key components of a revised business strategy focused on making movie rentals and sales available across multiple, complimentary distribution channels.
“That’s the moment we are waiting for, when we are finally going from theory to reality,” he said. “When we can cross all of those [release] windows seamlessly.”
Addressing the surge of rental kiosks and mandates by several major studios to delay distribution of new releases (by 30 days) to vending machines, Keyes said Blockbuster stores could accommodate the window while also providing a more cost-efficient internal source of physical discs for vending.
“Our stores can be the hub, and the kiosks our spokes,” Keyes said. “The stores will be around as long as we make them relevant.”
Separately, Blockbuster confirmed it had been notified by the New York Stock Exchange that its common stock shares had not met the minimum $1 per share value over a consecutive 30-day trading period. Blockbuster has six months to brings its share above $1 or risk being de-listed.