The End of Blockbuster As We Know It

Well, we all knew this day was coming.  The only surprise is that it took so long. 

Dish is closing all remaining Blockbuster retail stores and shutting down the DVD-by-mail service.  Dish will continue to use the Blockbuster brand and offer streaming service, but the DVD-by-mail service will end around the middle of December 2013.  The last stores will be permanently closed in January 2014. 

It's here.  This is the end of Blockbuster as we know it.

Blockbuster Store Closings Create Privacy Concerns

Beth Givens with Privacy Rights Clearinghouse was recently walking by a Blockbuster store in Mission Valley, San Diego which happened to be closing down. Outside of the store, Givens found a box of case files that contained Blockbuster employee records, such as job applications and detailed employment termination documents. The documents contained private information such as social security numbers, full names, etc. There are probably signatures and birthdays too. This could be a gold mine for an identity thief or a wonderful supply of embarrassing employment information.

Luckily, Givens found the employee files before a criminal found them. Givens plans to return the files to Blockbuster, and it appears no harm was done in this case, but this incident should sound an alarm.

Blockbuster stores are closing all over the country. With Dish Network taking over, many more Blockbusters are likely to be closing later this year. If Blockbuster is mishandling files from abandoned stores, not only are the employees at risk, but so are the customers.

When you opened that Blockbuster account years and years ago, do you remember exactly what information you put on the account application form? Where is that form now? Could an identity thief use that form to steal your identity? What about your rental records, credit card information, address, etc.? What is Blockbuster doing to make sure this information is not going to fall into the wrong hands?

With all of these stores closing, Blockbuster/Dish Network needs to get on top of this issue. When people trust a company with their privacy, that company has a duty to protect the information of its customers.

Blockbusted: Blockbuster Files for Chapter 11 Bankruptcy Protection

Blockbuster has filed Chapter 11. This is barely news, because we have all been seeing this coming for a couple of years. The reasons for the bankruptcy are fairly obvious: debt, outdated business model, alienated customers, constantly shifting pricing structures, unpredictable rental policy changes, tainted brand, etc. The question should not be, "Why did Blockbuster go Chapter 11?" but "How did Blockbuster stay out of Chapter 11 for so long?"

Now, what does all of this mean for you? If you are a common shareholder, you are probably about to get screwed and lose your investment. If you are a customer, things are less certain. Chapter 11 is a reorganization status. Blockbuster is not shutting down at the moment, but the company is likely to spend the coming months trying to restructure their organization into a profitable business. Look for a lot of store closings, changes in policies, changes in pricing, changes in store inventory, and changes in ways of doing business. (Wow! That sounds like business as usual for Blockbuster.) Maybe these changes will benefit the customers. Maybe the changes will be a big headache for customers. The good news is that you have choices. If Blockbuster changes in ways you do not like, just go somewhere else.

This Chapter 11 filing gives Blockbuster one last chance to get things right. If Blockbuster can take advantage of this opportunity, they might be able to figure out a way to please customers while being profitable. If Blockbuster cannot figure out how to rehabilitate their business model, then the eventual end of Blockbuster in inevitable. We will just have to wait and see.