Blockbuster and Chapter 11

Blockbuster, the company that once owned the video rental business, has announced $900 million debt and that it has filed for Chapter 11 bankruptcy protection. In a last chance and throw of the dice Blockbuster are now fighting for their lives in a world that has now clearly moved to movies on demand and instant access to movies on PCs and other devices.If the courts approve Blockbuster’s Bankruptcy plan it will clear its debts and only have a $125 million loan to its new ownership group and importantly access to additional $50 million credit line to finance operations.

Currently, all 3,000 Blockbuster stores in the U.S. will remain open and the company hope that this move will reposition its brand and build on its library of over 125,000 titles, and our position as the only operator that provides access across multiple delivery channels stores, kiosks, by-mail and digital.

How do such a giant as Blockbuster get into this mess? The answer is that they missed the likes of Netflix, didn’t position themselves for digital and 3,000 stores don’t count in an online world or even in a world where video disks get serviced through the mail. By the end of the year it is claimed that you will be able to stream Netflix movies on more than 100 different devices, whereas Blockbuster is on less than six devices.

It is a salient lesson to all High Street players in the media world that being the biggest and best doesn’t guarantee tomorrow only that you have further to fall.

BBC take one step back and Two Forward

BBC has announced plans to simulcast on handsets at the same time as they are broadcast on traditional television. Live TV is under beta testing enables all handsets with a WiFi connection to view BBC channels which have been optimised to play on small screens and hear radio broadcasts but their owners will need to hols a full colour TV licence.

Some programmes with licence restriction will be unavailable but the service is planned to grow enabling it to be enjoyed not just on the Nokia N series and TMobile G1 but on an expanding number of handsets. The BBC already enables some mobile phone users to access its catch-up television service, BBC iPlayer, through their handsets, but this will be the first time it has streamed live broadcasts to phones at the same time as they are being shown on television.

Also the joint broadcasting TV venture between the BBC, ITV and Channel 4 that was hypocritically squashed by the competition regulator may be rescued by network operator Orange.

Project Kangaroo, the video-on-demand joint venture is being eyed up by Orange who see it as complimentary to their television over the internet serviceIn November, Orange, which runs a television over the internet service in France, said it was considering different options for a launch in Britain.

Amazon on Demand

Amazon has announced Amazon Video on Demand which will be available to a limited number of Amazon.com customers this week and widely available later this summer. The new store will show some 40,000 movies and television programs, but unlike the original Amazon’s video store, will delivery these via a streaming Internet service not as downloads.

Amazon Unbox, the company’s original download-only video store required customers to download special software to watch the programs they bought and only worked on Windows PCs and TiVo set-top boxes.

Amazon has struck a deal with Sony to place its new Internet video store on the Sony Bravia line of high-definition TVs, making the new service available through Sony’s Internet Video link. Amazon now plans to pursue similar deals with other makers of TVs and Internet devices.

With the exception of Walt Disney and ABC, films and TV shows from almost all the major studios and television networks are available for sale or rental to Amazon’s customers in the United States.

Amazon Video on Demand will have formidable rivals with Apple, Netflix, Microsoft and Google all want to dominate the emerging world of digital video.