Dish to close rest of its Blockbuster stores in US
The final curtain is falling on the last Blockbuster video-rental stores that Dish Network Corp. runs in the U.S.
About 300 Blockbuster locations scattered around the country will be closed by early January. But 50 franchised stores will remain open in the U.S.
As part of Dish Network’s retreat, Blockbuster’s DVD-by-mail service also is shutting down next month.
About 2,800 people who work in Blockbuster’s stores and DVD distribution centers will lose their jobs, according to Dish Network.
The cost-cutting measures culminate a Blockbuster downfall that began a decade ago with the rise of Netflix’s DVD-by-mail service, followed by the introduction of a subscription service that streams video over high-speed Internet connections.
“This is not an easy decision, yet consumer demand is clearly moving to digital distribution of video entertainment,” Dish Network CEO Joseph Clayton said Wednesday.
The shift has been a boon for Netflix Inc., which now boasts 31 million subscribers to its Internet video service and another 7.1 million DVD-by-mail customers. The company’s success has minted Netflix with a market value of $20 billion.
But Blockbuster absorbed huge losses. It closed thousands of its stores before landing in bankruptcy court three years ago. Dish Network bought Blockbuster’s remnants for about $234 million in 2011 and then tried to mount a challenge to Netflix.
Blockbuster suffered an operating loss of $35 million on revenue of $1.1 billion last year, according to regulatory filings.