Sold! Dish Network Buys Blockbuster at Auction

For some reason, Dish Network has chosen to drop $320 million on the purchase of Blockbuster, Inc. No one is quite sure what Dish Network intends to do with Blockbuster, but one might imagine that Dish Network could use this as an opportunity to create a big brick-and-mortar retail presence. Dish Network could be trying to position itself to better compete with Netflix by being on the street and in the mail in addition to the skies. 

By taking over Blockbuster's existing infrastructure, retail presence, customer base, relationship with movie studios, and merchandise supply channels, Dish Network now has the tools to become a potential threat to companies like Netflix.  Dish Network could now be in the unique position of being able to deliver all kinds of movies to all kinds of consumers in all kinds of different ways.  What other company has all of that?  Redbox has the rental kiosks.  Netflix has DVDs by mail and streaming video.  Many retail stores sell videos.  The pay TV channels and many other services offer video-on-demand.  Up until now, no one company has been able to offer it all, and no one company has been able to reach what is nearly the entire market of video renters/buyers.  Perhaps Dish Network will try to be the first to make that happen.    

Considering the harsh realities that Blockbuster had been facing, this deal is probably as good as it could get for Blockbuster. If Dish Network does wish to build a strong retail presence, they will probably not be liquidating Blockbuster (which had been an extremely likely possibility). If Blockbuster continues to exist in brick-and-mortar form, many Blockbuster employees may be able to hang on to their jobs for a while. Consumers will also not have to face losing one of their video rental options.

Not much is certain at this point, but the Dish Network takeover is probably being viewed as at least moderately encouraging news for anyone who likes Blockbuster or depends on the company for a living.