What Is the Future of Blockbuster? - NBC 5 Dallas-Fort Worth

What Is the Future of Blockbuster?

Shareholders angry over stock delisting



    What Is the Future of Blockbuster?
    Dallas-based Blockbuster is struggling to adapt to the new movie market landscape.

    Angry over the delisting of Blockbuster stock, a major group of shareholders is calling for an emergency meeting, raising questions about the future of the video-rental giant.

    The made the request in a letter to Jim Keyes, Blockbuster’s top executive, but the Dallas-based company had no immediate response to the letter.

    The New York Stock Exchange delisted the company after its average stock price fell below $1 for more than a month.

    For 20 years, Blockbuster wrote the script in the video rental business. But over the last decade, analysts say, the old model changed -- with movies now delivered on-demand, over the Internet or by cable and satellite TV providers.

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    "There are so many pipelines going into houses these days, Blockbuster and everyone else has to figure out how to plug into that pipeline,” said Mike Davis, a professor at Southern Methodist University's Cox Business School.

    Keyes admitted in a recent interview that the company hasn't adapted fast enough.

    “We were a little slow to change, but we’re here to fix that,” he said.

    It will be a challenge, analysts agree.

    The company's stock is now selling over the counter for as low as 12 cents per share.

    But Blockbuster isn't sitting still. It's closing old-fashioned stores, installing new kiosks and diving into digital delivery.

    It’s also taking on one of its biggest competitors, Netflix, with a movie-by-mail service.

    “Blockbuster is not about the physical store,” Keyes said. “That’s not who we are.”

    Analysts say if Blockbuster can survive, its success will be a test of how quickly it can reinvent itself and adopt changing technology.

    Davis said Blockbuster is still a solid brand and shares many of the same challenges with its competitors.

    "Blockbuster is, or was at least, a very well-run company,” Davis said. “But the problem is they're in a market where things change so fast and so unpredictably that they have to remake themselves every few years."