Originally posted by: PaulNEPats
I run a Blockbuster store, so you can go with what I said
I work in corporate so I'll double confirm it.
Originally posted by: mugs
And he's said it three times already. I guess this is what makes him an "Elite Member". I call neffbot h4x0r.
Anyway, I have Blockbuster Online and this sounds like it could be pretty hot. I'll be stopping by BB after work today and I'll try to get some clarification on exactly how this will work.
Originally posted by: Cutterhead
Originally posted by: mugs
And he's said it three times already. I guess this is what makes him an "Elite Member". I call neffbot h4x0r.
Anyway, I have Blockbuster Online and this sounds like it could be pretty hot. I'll be stopping by BB after work today and I'll try to get some clarification on exactly how this will work.
Just read what wyvrn or myself said in this thread
It is too hard to find anything in the store. I will still select online if I ever get the service.
Anyway, they are all about saving shipping costs, that is why this is being done.
Anyway, they are all about saving shipping costs, that is why this is being done.
This doesn't save shipping costs. The mailers still have to be sent back to the distribution centers. The in-store free rentals are in addition to your online rentals.
I am a member of this Blockbuster online thing (after an excruciating throttle down by Netflix) and although they are slower in shipping they seem to be more reliable. The 4 free in-store rentals I get each month make up for the slow deliveries.
This just makes it better.
This just makes it better.
Also wanted to note that a new version of blockbuster online has been rolled out and it's much better. For instance, the interface to search for movies is more robust, and the rating system is much better. The whole site has been revamped. I know also that the algorithm for predicting demand of movies has been improved, so that should mean more availability of the hottest titles.
Certain customers (I'm one of them) have been switched over to Total Access for about two weeks now. PaulNEPats has given accurate info. You simply take your sealed return envelopes back to the store and exchange them for a free in store rental (which are subject to normal in store due dates, late fees, etc. and must be returned to the same store). They can only be exchanged for dvd movies (not games, or at least not games at time of trial run, I don't know if this will change after launch). The next movie in you online queue is then shipped to you in addition to the free in store rental the following day (maybe the same day if returned early enough but I haven't returned one early in the day yet). All plans have had the printable free in store rental coupons reduced to one per month now. Two plans have also been dropped (unless you are already grandfathered in), the 5 and 8 at a time plans, now 4 is maximum. All in all, there is absolutely nothing to dislike about this move by Blockbuster, this is what I've wanted all along.
BB earnings webcast is about to begin. After looking at the financials sent to me this morning. BB is doing MUCH better. Their online business has grown 50% from this time last year. BB was the fastest to 1 million Online customers, even beating Netflix time to that mark. Once BB reaches 2 million online subscribers, they begin to show a profit. There is an outside chance that will be this year, but more likely Q1 of 2007 by the pace of it.
Because of store closings, BB in store revenues are up over 3% year over year. This means while they are closing stores, they are grabbing a higher percentage of the overall B&M rental market. They have a strong grip on this over their next competitor.
If BB can use their B&M business to create Online subscribers, then watch out. They could climb back to king of the hill.
B&M revenues were positive for the first time in years, and there was an operating gain. Also because of tax provisions, BB overall is reporting a quarterly profit for the first time in a long time.
Watchout Neflix, the giant has awoken again.
Because of store closings, BB in store revenues are up over 3% year over year. This means while they are closing stores, they are grabbing a higher percentage of the overall B&M rental market. They have a strong grip on this over their next competitor.
If BB can use their B&M business to create Online subscribers, then watch out. They could climb back to king of the hill.
B&M revenues were positive for the first time in years, and there was an operating gain. Also because of tax provisions, BB overall is reporting a quarterly profit for the first time in a long time.
Watchout Neflix, the giant has awoken again.
This sounds like a good idea. I might have to start going to my local BB again. I'm hardly ever in that area though... mailbox drops are on the way to work so that would work for BB too but doesn't make sense with the instore promotion.
- Aug 24, 2001
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Originally posted by: wyvrn
BB earnings webcast is about to begin. After looking at the financials sent to me this morning. BB is doing MUCH better. Their online business has grown 50% from this time last year. BB was the fastest to 1 million Online customers, even beating Netflix time to that mark. Once BB reaches 2 million online subscribers, they begin to show a profit. There is an outside chance that will be this year, but more likely Q1 of 2007 by the pace of it.
Because of store closings, BB in store revenues are up over 3% year over year. This means while they are closing stores, they are grabbing a higher percentage of the overall B&M rental market. They have a strong grip on this over their next competitor.
If BB can use their B&M business to create Online subscribers, then watch out. They could climb back to king of the hill.
B&M revenues were positive for the first time in years, and there was an operating gain. Also because of tax provisions, BB overall is reporting a quarterly profit for the first time in a long time.
Watchout Neflix, the giant has awoken again.
Since you're the man on the inside....what is the thinking about not doing game rentals online? You think Blockbuster could leverage the same advantage they have over Netflix over GameFly and other online game rental companies.
Hear the webcast on BB.com, go to investor relations
Points from the webcast:
Domestic B&M sales are up over 3%
International is down over 7% (Spain stores are closed)
Game releases for 3Q are down 14% since last year (meaning companies are announcing less titles)
However, launch of Wii and PS3 should change this, plus penetration of Xbox 360 on the rental market has been positive
BB is benefiting from more efficient inventory management
Retail gross margin is up 27.2%
SGA declined 28.2 million since last year, but mainly because of cost reduction programs initiated 3Q 2005
BB has no outstanding payments on it's revolving debt agreements
Adjusted operating income up 11million from same time last year
129.8 million in free cash flow in 2006
This year's game and movie title lineup should be much stronger than last year, which should help overall revenues.
Expectations:
From John Antioco, CEO-
Research showed that customers were most interested in Total Access type of program. Studies were shown of B&M customers, online services (including Netflix), and people who pay per view and download videos.
Test markets showed very positive reaction to Total Access in test markets, including improvement in revenues, subscriber activations, and online churn was down.
Total Access strength is 'consumer appeal'. It's easy to understand and benefits the customer most.
If you don't like the movie you received, then take it to the store and exchange it for a new one. This is where the coupons for returning movies is an advantage to the consumer.
Spontaneous at home movie nights are supported by the B&M rentals. No waiting for movies you really want now. Damaged DVDs can be exchanged at the stores, again no waiting. Total access provides better solutions, and is dubbed 'online renting without the wait'. Value, flexibility, convenience.
This raises the bar for what consumers will expect from Online renting going forward. This differentiates BB from the competitors.
This should strengthen the B&M revenues and market share. Favorable impact from total access for 3 reasons:
1) Increase in in-store revenues due to more customers in store, including new customers to the program.
2) Financial performance will benefit from reduced online subscription churn, which has been observed in test markets.
3) Impact subscriber aquisition costs in a positive way (online will help B&M business).
Nothing stopping BB for having different price points. Now have ability to put together a variety of subscription offerings that can appeal to most customers.
Will be testing broadcast advertising of TA in certain markets, balance between subscriber growth and profitibility objectives.
For B&M rentals, BB rentals are up 1.8% while other chains, MG and Hollywood, were down over 6% in same timeframe.
edit: Antioco thinks online market is 12-18 million customers in future, and that BB will grow faster than competitors in 2007 because of integration concepts.
Points from the webcast:
Domestic B&M sales are up over 3%
International is down over 7% (Spain stores are closed)
Game releases for 3Q are down 14% since last year (meaning companies are announcing less titles)
However, launch of Wii and PS3 should change this, plus penetration of Xbox 360 on the rental market has been positive
BB is benefiting from more efficient inventory management
Retail gross margin is up 27.2%
SGA declined 28.2 million since last year, but mainly because of cost reduction programs initiated 3Q 2005
BB has no outstanding payments on it's revolving debt agreements
Adjusted operating income up 11million from same time last year
129.8 million in free cash flow in 2006
This year's game and movie title lineup should be much stronger than last year, which should help overall revenues.
Expectations:
From John Antioco, CEO-
Research showed that customers were most interested in Total Access type of program. Studies were shown of B&M customers, online services (including Netflix), and people who pay per view and download videos.
Test markets showed very positive reaction to Total Access in test markets, including improvement in revenues, subscriber activations, and online churn was down.
Total Access strength is 'consumer appeal'. It's easy to understand and benefits the customer most.
If you don't like the movie you received, then take it to the store and exchange it for a new one. This is where the coupons for returning movies is an advantage to the consumer.
Spontaneous at home movie nights are supported by the B&M rentals. No waiting for movies you really want now. Damaged DVDs can be exchanged at the stores, again no waiting. Total access provides better solutions, and is dubbed 'online renting without the wait'. Value, flexibility, convenience.
This raises the bar for what consumers will expect from Online renting going forward. This differentiates BB from the competitors.
This should strengthen the B&M revenues and market share. Favorable impact from total access for 3 reasons:
1) Increase in in-store revenues due to more customers in store, including new customers to the program.
2) Financial performance will benefit from reduced online subscription churn, which has been observed in test markets.
3) Impact subscriber aquisition costs in a positive way (online will help B&M business).
Nothing stopping BB for having different price points. Now have ability to put together a variety of subscription offerings that can appeal to most customers.
Will be testing broadcast advertising of TA in certain markets, balance between subscriber growth and profitibility objectives.
For B&M rentals, BB rentals are up 1.8% while other chains, MG and Hollywood, were down over 6% in same timeframe.
edit: Antioco thinks online market is 12-18 million customers in future, and that BB will grow faster than competitors in 2007 because of integration concepts.
Originally posted by: Queasy
Originally posted by: wyvrn
BB earnings webcast is about to begin. After looking at the financials sent to me this morning. BB is doing MUCH better. Their online business has grown 50% from this time last year. BB was the fastest to 1 million Online customers, even beating Netflix time to that mark. Once BB reaches 2 million online subscribers, they begin to show a profit. There is an outside chance that will be this year, but more likely Q1 of 2007 by the pace of it.
Because of store closings, BB in store revenues are up over 3% year over year. This means while they are closing stores, they are grabbing a higher percentage of the overall B&M rental market. They have a strong grip on this over their next competitor.
If BB can use their B&M business to create Online subscribers, then watch out. They could climb back to king of the hill.
B&M revenues were positive for the first time in years, and there was an operating gain. Also because of tax provisions, BB overall is reporting a quarterly profit for the first time in a long time.
Watchout Neflix, the giant has awoken again.
Since you're the man on the inside....what is the thinking about not doing game rentals online? You think Blockbuster could leverage the same advantage they have over Netflix over GameFly and other online game rental companies.
BB says finding a profitible business plan for game rentals is harder than movies.
Games are more expensive from a revenue sharing agreement perspective, which is how BB gets their copies of titles. So when a customer scratches a disc or when one is broken in the mail, it is much more expensive to replace than a movie title.
Also, games rent for longer, and don't get as many repeat rentals. So with less cycles, it is easier to take a loss on a game title than a movie title.
So for example, suppose that BB ordered 100k copies of a game. What if this game tanked, BB is still responsible for paying for each copy. Selling used games is not a huge business either.
Add to this one of the most popular game types, sports, has a very short window of success because the next title is due out in a year. So revenues from this genre almost completely disappear in a short time.
Not sure if this is entirely true, but this is what I have been told from BB perspective. I also think for myself that BB wants to concentrate on the movie business and get that strong, and afterwards you might see this extended to games. But BB doesn't have the cash reserves to take a chance on a fringe business model and fail.
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