National movie rental company Blockbuster filed for Chapter 11 last year, but that isn’t stopping the chain from mounting a comeback in 2011. The increasing popularity of rental kiosks like Redbox – which many conclude led to Blockbuster’s bankruptcy filing – has ironically given the struggling company a new lease on life. Even as Blockbuster stores across the country are shuttered (one location right down the street from me has been liquidating its inventory for the past few weeks), the installation of thousands of new Blockbuster Express rental kiosks is in the works.
According to a report, 3,000 more Blockbuster Express vending kiosks will pop up across the country this year. Blockbuster Express owner NCR estimates that by the time 2011 ends it will have garnered around $200 million in revenue for the year. The company also outlined plans to reposition kiosks which underperformed.
Movie kiosks such as Blockbuster Express and Redbox, which allow customers to rent new DVDs for a relatively low price, have completely overtaken traditional retail stores in 2010 according to a report issued by the NPD group last month. Though it’s worth noting online subscription service Netflix surpassed them both.
Russ Crupnick, an analyst with the firm, explained, “Traditional video retailers will no doubt experience even more competition in the coming year, as kiosks appear more frequently in grocery store chains, mass merchandisers, and quick-serve restaurants, and as competition intensifies from an assortment of on-demand rental offerings.”
It’s unclear if Blockbuster will eventually be liquidated – like its former competitor, Hollywood Video. What is clear, however, is that the company, once synonymous with movie renting, is adapting. But will it be too little, too late?