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Business News Retail
Blockbuster US closing down remaining stores
By Chris Cooke | Published on Friday 8 November 2013
Following the news last week that DVD rental and entertainment retail chain Blockbuster was back in administration in the UK, the firm’s US counterpart is planning on closing all its directly managed high street stores, resulting in the closure of 300 shops and the company’s distribution centres and DVD-by-mail service.
As previously reported, the North American Blockbuster business hit the hard times before the UK version of the company, filing for bankruptcy in 2010. It was then bought by satellite TV firm Dish Network, which has been downsizing the business ever since, taking the company from 1700 stores to the 300 that remain, which will now be shut down early next year.
Although that will mean that pretty much the entire American Blockbuster enterprise has been wound down, Dish Network plans to retain the brand. Franchisee stores will still operate, and Dish hopes to continue building the online Blockbuster business.
Dish CEO Joseph P Clayton told reporters: “This is not an easy decision, yet consumer demand is clearly moving to digital distribution of video entertainment. Despite our closing of the physical distribution elements of the business, we continue to see value in the Blockbuster brand, and we expect to leverage that brand as we continue to expand our digital offerings”.
Blockbuster UK, faced with most of the same challenges as the American company – ie competition from Amazon’s LoveFilm and the growth of digital on-demand video services – went into administration earlier this year.
Although it was then rescued by private equity firm Gordon Brothers in March, with bold plans to step up Blockbuster’s online services in the UK and to diversify product lines instore (including an expansion of music products), last week the company’s new owners put the business back into administration, saying they too were now trying to offload the firm.
