Last week, video rental giant Blockbuster Video filed for Chapter 11 bankruptcy. The bankruptcy filing was expected given the company’s ongoing struggle to compete with video streaming and DVD mailings that Netflix and other competitors offer. We can remember Blockbuster slogans such as “Blockbuster video. Wow, what a difference!” and “Make it a Blockbuster night.” However, most of us cannot recall the last time we actually meandered the yellow and blue aisles of a Blockbuster brick-and-mortar store to rent a movie. In the age of Netflix, Redbox, and on-demand videos, traveling to a video store seems slightly archaic.
But, we needn’t say bye bye to Blockbuster just yet! Through its Chapter 11 filing, the company wishes to rid itself of most of its nearly $1 billion debt in order to more effectively respond to competition. As the company restructures, we can anticipate a vast number of store closings and an increase in online, mail, and kiosk offerings.
In light of Blockbuster’s bankruptcy, is Netflix running a proverbial victory lap? Not quite. Netflix is facing its own intense competition in the online streaming market. Netflix, Hulu, YouTube, and likely Blockbuster continue to scramble for content and vie for consumer attention.