Trying to keep its head above water, Blockbuster filed for Chapter 11 bankruptcy today. The chain of video rental outlets hopes to keep its video kiosks and brick and mortar stores open while it restructures, reports the Associated Press.
The filing comes about a month before the 25th anniversary of the opening of Blockbuster’s first store in Dallas. “‘End of an era’ summarizes it neatly,” says John Tinker, senior media analyst at Maxim Group, a brokerage firm.
The move, long expected and pre-arranged with bondholders, ends an era that Blockbuster dominated — of Americans visiting video stores for movie rentals. Increasingly, Americans are watching movies via video subscription services such as Netflix, vending machine services such as Redbox and services that offer movies on demand via cable, satellite and the Internet.
n a submission to the U.S. Bankruptcy Court in the Southern District of New York on Thursday,Blockbuster said it reached an agreement with its bondholders on a recapitalization plan.
Blockbuster plans to reduce debt from nearly $1 billion to about $100 million or less by swapping debt for equity in a reorganized Blockbuster with bondholders that hold about 80% of the company’s senior notes.
It has received commitments for $125 million in “debtor-in-possession” financing from senior noteholders to repay customers, suppliers and employees during the reorganization.
Is Block Buster to big to go under? If we allow Block Buster to go under where will Grandma who says dot com is the devil get her movies? Will the giants like Google and Apple take over what we watch? Today Apple controls what is available to rent on itunes and what games we can put on out media devices. Just saying…… Something to think about.
It’s not Apple who controls what we can watch. They would love nothing better than to be able to charge us for anything & everything they can.
It’s the networks and movie studios who are ultimately in charge of how / if we can view their content.
Case in point: http://news.cnet.com/8301-13506_3-20017373-17.html