Investing

Dish Network To Reboot Blockbuster

Just as it appeared that Blockbuster would be liquidated Dish Network bought it for $320.6 million in a process overseen by a federal bankruptcy court, according to The Wall Street Journal.

The most extraordinary part of the buyout is not that Dish topped the offer of perennial Blockbuster investor Carl Icahn, but that the satellite TV company will continue to operate the video rental business as a largely intact company. It is hard understand how Dish could have made this decision.

Dish apparently thinks it can sell subscriptions to its satellite TV business from the counters at Blockbuster stores. Dish also sees “synergy” between the Blockbuster VOD over IP service and its own.

The Dish decision puts it more into direct competition with premium video over the internet companies like Netflix (NASDAQ: NFLX), Apple (NASDAQ: AAPL), and Amazon.com (NASDAQ: AMZN). If so, Dish is late to a crowded party and may be ill-equipped to do well.

One of the advantages Netflix, the streaming video leader, has is its 20 million subscribers, over two-thirds of which use its online service. Netflix has also shown an appetite for the creation of original programs like those made by HBO. Netflix has also made expensive arrangements with producers to get exclusive rights to popular content. It will start to offer the series “Mad Men” soon.

Dish apparently failed to understand how difficult the Blockbuster model was to make work. Icahn’s replaced management and board could not. Even this access to talent could not repair a business which became antiquated in the blink of an eye. Dish does not have any better management to offer and its does not have a new model which has not been tried before. Blockbuster died a long time ago, and Dish will not succeed where so many others have failed.

Douglas A. McIntyre

Take Charge of Your Retirement In Just A Few Minutes (Sponsor)

Retirement planning doesn’t have to feel overwhelming. The key is finding expert guidance—and SmartAsset’s simple quiz makes it easier than ever for you to connect with a vetted financial advisor.

Here’s how it works:

  1. Answer a Few Simple Questions. Tell us a bit about your goals and preferences—it only takes a few minutes!
  2. Get Matched with Vetted Advisors Our smart tool matches you with up to three pre-screened, vetted advisors who serve your area and are held to a fiduciary standard to act in your best interests. Click here to begin
  3. Choose Your  Fit Review their profiles, schedule an introductory call (or meet in person), and select the advisor who feel is right for you.

Why wait? Start building the retirement you’ve always dreamed of. Click here to get started today!

 

Thank you for reading! Have some feedback for us?
Contact the 24/7 Wall St. editorial team.

AI Portfolio

Discover Our Top AI Stocks

Our expert who first called NVIDIA in 2009 is predicting 2025 will see a historic AI breakthrough.

You can follow him investing $500,000 of his own money on our top AI stocks for free.