Blockbuster to Be Bought by Dish Network
The long saga of Blockbuster’s bankruptcy looks like it has come to an end with the announcement that Dish Network would be buying the troubled retailer for roughly $228 million in cash after adjustments. Bidding on Blockbuster reportedly extended into the early hours of this morning, with investor Carl Icahn trailing just behind Dish Network’s ultimately successful bid.
So what’s likely to come of this? Promotional tie-ins, for one: In Dish Network’s press release, company EVP Tom Cullen said that “With its more than 1,700 store locations, a highly recognizable brand and multiple methods of delivery, Blockbuster will complement our existing video offerings while presenting cross-marketing and service extension opportunities for DISH Network.” But using retail locations to hawk Dish Network subscriptions is just one piece of the puzzle: The other is Blockbuster’s Internet streaming rights from major Hollywood studios. An analyst writes:
As part of an acquisition, DISH would presumably get Blockbuster’s Internet streaming rights, the Blockbuster brand and its customer lists. Combined with a build-out of the wireless spectrum it has acquired and technology from EchoStar and Hughes, we believe DISH could launch an on demand movie service that would 1) significantly enhance the competitive offering of the DISH Network, and 2) compete on a standalone basis with Netflix and other over-the-top video services.
Could a Dish-resuscitated Blockbuster resurge as a Netflix competitor? Stranger things have happened. In any event, this is a more interesting outcome than Blockbuster being bought by creditors who wanted to pick its bones dry, and potentially more beneficial for consumers as well.