Blockbuster Leaving Spain15 Mar, 2006 By: Erik Gruenwedel
Blockbuster Inc. is ceasing operations in Spain due to piracy and increased consumer use of digital television, including on-demand programming, according to Spanish trade union UGT.
Blockbuster, which began operations in Spain in 1991, has 86 store locations in the country. The move does not affect 13 stores in neighboring Canary Islands.
The closures should be completed by mid-May, according to a spokesperson from Blockbuster's corporate headquarters in Dallas.
The video rental chain's revenue reportedly fell 25% in 2005. Reuters reported Blockbuster Spanish revenue dropped 20% in 2004.
The trade union claimed about 700 Spanish Blockbuster employees affected by the change would receive 35 days of severance for every year employed.
CEO John Antioco has repeatedly said the chain would aggressively initiate across-the-board cost cuts, including shuddering or selling select overseas operations.
Spanish media reported that rival video retailer The Big Orange was in negotiations to assume select store leases and acquire Blockbuster's product.