I predicted the fall of Blockbuster before 2010 lets out, but it looks like they are making a final push to save their company. This week it is expected that Blockbuster will file for Chapter 11 by the end of this week in an effort to rebuild and come back from this debt.
Video rental giant Blockbuster is expected to file for Chapter 11 bankruptcy protection as early as today, the Wall Street Journal reported Wednesday, citing sources.
Investor Carl Icahn, who owns about a third of the firm’s senior debt, is playing a key role. He has led the charge to free Blockbuster of debt and will either return to the company’s board himself or designate a representative, the paper said.
Are brick and mortar video rental stores even an option for the future of media delivery?
With their main competitors being Netflix and Rogers, both steering away from physical movie rentals and opting for mail-in or online digital delivery, I predict that companies like Blockbuster just don’t stand a chance.
Blockbuster did dive into the mail-in option with the advantage that you could return those movies to a brick and mortar store for faster turn around, but when Netflix started offering online content delivery, the gloves were off.
Now remember, Chapter 11 Bankruptcy is a protection plan, not actual financial failure. This allows them a window to ignore their bills while they reorganize and build a strategy to pay them off.
But is there a way out for a service industry so rapidly changing? Has the competition already squashed out any hope of competition from the once massive Blockbuster chain?
