Archive for March 4th, 2010
Sorry, But There’s No Way Digital Is Going To Save Blockbuster (BBI, NFLX, AAPL)
Blockbuster, the shrinking movie rental business, is hoping that a Hail Mary transition to kiosks and digital movie distribution will save it from going to zero.
That’s just not likely to happen. The odds of success are extremely low, given how late Blockbuster is to both technologies, how undifferentiated its offerings are (so far), and how distracting it’s going to be to spin down its retail business. (It recently announced that it’s closing 500 stores in a desperate bid to save $200 million.)
That didn’t stop CEO Jim Keyes from going on CNBC today to spin his plans as if they were easily achievable. (See video below.)
The most alarming exchange: About 1 minute, 15 seconds in, when Keyes tries to suggest that Blockbuster’s retail legacy will be helpful in its switch to digital.
“When you’re driving down Main Street and you see that Blockbuster brand, you know it’s the place to rent movies,” he said, as paidContent’s Joe Tartakoff relays. “The same experience we think will be true on the Internet. There will be a vast array of people offering movies. Blockbuster is a very reliable brand, so we think that the future is bright for us once we are able to make that transformation.”
Sorry, but Blockbuster’s brand carries zero equity on the Internet. That’s like making the argument that Sam Goody or Tower Records could steamroll Apple’s iTunes just because it once had a large offline presence.
Assuming digital ever gets big — so far it’s very tiny, with DVD still five times bigger — the winners are going to be the companies with the best distribution, content, technology, and pricing. There’s just no way that Blockbuster is going to win in any of those categories, let alone all of them.
Maybe, just maybe, there’s an argument to be made that Blockbuster’s legacy DVD relationships could score it some more attractive digital rental windows that Hollywood won’t give iTunes, Netflix, or Redbox. But if Hollywood is going to play nice with anyone, it might as well be the cable industry, which actually has a future, or Walmart, which sells vastly more DVDs than Blockbuster, is not shrinking, and just bought a digital movie business, Vudu.
Meanwhile, Blockbuster’s cable rivals like Comcast already have far stronger distribution — via the set-top box already in your living room, and the dedicated video pipe running into your house; Apple and Netflix are arguably leading the technology race; and everyone’s on-demand pricing and content is pretty similar right now.
How about Blockbuster’s opportunity to sell some of its stores for quick cash to pay down its debt? (As CNBC’s Dennis Kneale asks at the end of this segment.) That’s also not in the cards. Jim Keyes says Blockbuster leases almost all of its stores on “very short-term leases” — so the company doesn’t have much of a real estate portfolio.
Instead, Keyes describes this as a “stepping stone” to help shift its customers to digital solutions. Come again?
Here’s the whole video:
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See Also:
- Blockbuster Collapses: Shutting Down 500 Stores In Desperate Bid To Save $200 Million
- NCR-Blockbuster Roll Out Kiosks In NYC To Challenge Redbox
- Man Stabs Himself To Avoid Working Shift At Blockbuster Video
NEWSFLASH: It’s Abortion That’s Going To Kill Healthcare Reform
Courtesy of Republican Whip Eric Cantor, here’s Democratic Congressman Bob Stupak confirming that if the House tries to pass the Senate’s version of healthcare reform, there is a significant group of Congressman who previously voted “YES” but will now vote “NO”.
The reason?
Abortion.
The Senate’s version doesn’t restrict government funding for it.
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See Also:
- Chanos Is Done Shorting Healthcare, After Watching This Administration "Give Up All Its Principles"
- Here’s Something We Can Easily Do That Will Accomplish Way More Than Solving Healthcare
- Buffett: America Desperately Needs To Change Healthcare If It Wants To Be Economically Competitive
The Real Reason For The Justice Roberts Is Leaving Rumor: A 1L Is Dumb
Remember Radar Online’s “exclusive” about Chief Justice Roberts vacating his seat?
Turns out a less-than-sharp 1L in Georgetown Professor Peter Tague’s criminal law class this morning is to blame, as uncovered by the chaps over at Above The Law.
Per one of their eager informants:
It was Professor Tague. Today’s class was partially on the validity of informants not explaining their sources. He started off class at around 9 am EST by telling us not to tell anyone, but that we might find it interesting that tomorrow, Roberts would be announcing his retirement for health concerns. He refused to tell anyone how he knew. Then, at around 9:30, he let everyone in on the joke.
While it’s newsworthy that any news outlet would actually publish such a rumor without naming a source, or apparently relying on the word of a single, gullible 20-something kid, it’s also striking that a future lawyer who was smart enough to get into Georgetown is this, well, gullible.
According to one student we spoke with who was in Prof. Tague’s class this morning, “if you weren’t completely oblivious you would know that first, he would never share that information with 120 people he doesn’t know. Second, it was so clearly tailored to what we learned in class that no one should have not known.”
The students were learning about the necessary standard of probable cause.
Apparently Prof. Tague, after discussing Roberts’ departure, asked the students not to tell other students. After revealing it was a ruse, he noted that unsubstantiated claims can have far-reaching and dire consequences. “He told us at the end of class that [the Justice Roberts' leaving assertion] was one examples of something that could be dangerous it ends up going some place,” he said. “It’s kind of funny that it actually happened.”
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See Also:
- UPDATE: RADAR RETRACTS — Radar Reporting Insane John Roberts Rumor: "Seriously Considering Stepping Down"*
- Jeffrey Rosen: Barack Obama Could Nominate Barack Obama For Supreme Court
- Madam Justice Hillary Clinton?
Whoa, John Roberts Looks A Lot Like Jamie Dimon
John Roberts, the US Supreme Court Chief Justice is not considering resigning.
But if he were, he could do a lot worse than playing Jamie Dimon in the HBO version of Sorkin’s Too Big To Fail.
All credit to The Epicurean Dealmaker who observed the resemblence.
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See Also:
- UPDATE: RADAR RETRACTS — Radar Reporting Insane John Roberts Rumor: "Seriously Considering Stepping Down"*
- John Roberts Refuses To Block Gay Marriage In Washington D.C.
- HBO Making A Movie Based On Andrew Ross Sorkin’s ‘Too Big To Fail’
Check Out This Awesome Day Trader’s Set Up
Lifehacker has the photos from an awesome day trader’s set-up, which includes 40 24 inch monitors.
There are plans to expand the set-up even further to a total of 60 screens.
There are a total of 6 computers that feed the monitors.
The whole system is used for “intraday trading and development.”
Yeah, we have no idea either.
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See Also:
- HOUSE PORN OF THE DAY: Rush Limbaugh’s $13.95 Million 5th Ave Penthouse
- Current Microsoft GC Is A Computer Nerd From Way Back
- Apple Launching 22-Inch Touch Computer This Year, Says Chinese Report