01-05-2007, 10:49 AM
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Confirmed User
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Join Date: Jun 2001
Location: Sunny Land
Posts: 5,593
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ha, and they just posted this a little bit ago after my in depth analysis:
Quote:
Left for dead by some observers a couple of years ago, Blockbuster Inc. showed this week that it may be figuring out the online DVD rental game by using it as an added-value proposition for its in-store customers.
Dallas-based Blockbuster (BBI: news) took a number of analysts by surprise Wednesday when it revealed that it picked up 700,000 online subscribers in the fourth quarter, after relatively modest online customer growth during the first nine months of 2006.
This surge was largely attributed to Blockbuster's Total Access service, launched in November. Total Access allows its online customers to either return DVDs through the mail or exchange them at a store in exchange for free in-store movie rentals.
The offer is similar to free rental coupons Blockbuster had offered subscribers, said Michael Pachter, an analyst at Wedbush Morgan Securities. However, turning in a disc at the store in exchange for a free movie is a much simpler transaction because nothing has to be printed out, he said.
"I thought that was clever, but I didn't think it would have such a dramatic effect that subscriber additions would jump from 200,000 a quarter to 700,000," Pachter said.
Blockbuster Chief Executive John Antioco said consumers are realizing they can have the best of both worlds with Total Access. "The No. 1 factor is convenience," he said in an interview. "You never have to leave your house to get a movie, but if you want to have immediate gratification, you have immediate access to a Blockbuster store."
While some have questioned the depth of Blockbuster's selection, particularly in comparison with rival Netflix, Antioco points out that his company's online catalog now has 65,000 titles to choose from, offering plenty of variety for most consumers.
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