About one week after Netflix announced it will launch in Canada sometime this fall, Blockbuster fired back by announcing an unlimited DVD rental service for $9.99 per month.
The new Blockbuster "Favorites Pass" service offers DVD rentals -- just one movie rental at a time -- and doesn't include Blu-ray and new releases.
"If you rent and return 15 movies in one month, each would cost just over 50 cents per rental," Blockbuster Canada announced in a press statement.
I applaud Blockbuster for releasing a $9.99 unlimited movie rental plan to Canadian subscribers – especially as an answer to Netflix’s announcement – but I don't know if consumers will be anxious to go for this. I think it’ll end up being too little, too late for Blockbuster, as consumers will head towards Netflix, which doesn't exclude new releases.
As a larger number of subscribers continue to switch to streaming, expect Netflix and Blockbuster to engage in a Canadian marketing battle.
Starting at a price expected to be close to Netflix's $8.99 minimum rental fee in the U.S., Netflix Canada will provide an English streaming service to residents.
Blockbuster Canada has cut new-release DVD rentals to $3.99 as the company faces competition from Walmart Canada. The company will now be in a fight to stay ahead of the likes of Netflix, Walmart and other rivals that will be in the Canadian marketplace by the end of the year.
Unlike Blockbuster's struggles in the U.S., Blockbuster Canada remains debt-free and popular among Canadian movie viewers. The company has more than 450 stores nationwide with $400 million annual sales. However, there is concern Netflix's introduction into the Canadian market this fall could make Blockbuster face a similar fate as it has in the United States -- struggling against Netflix, Redbox and other competitors, along with the constant threat of bankruptcy.
