After years of growth in the late 90s and early 2000s, Blockbuster faced a series of challenges as streaming became more accessible which would lead to the company going bankrupt and closing all but one of its stores.
However, Blockbuster's success was short-lived, and the company filed for bankruptcy in 2010. The rise of digital streaming services like Netflix and Hulu contributed to Blockbuster's decline, as consumers increasingly turned to these services for their entertainment needs.
It is hard to overstate how much Blockbuster customers hated late fees, which could easily double or even trip the cost of the original rental, even if a movie was returned only a few days late. By eliminating fees, Netflix gained a concrete advantage it could use to attract customers.
Viacom bought Blockbuster in 1994 and then spun it out in 2004. As part of the deal Blockbuster had to pay a $5 per share dividend which caused Blockbuster to take out a $905 million loan to pay for the dividend. By the time Blockbuster filed for bankruptcy in 2010 it had $1 billion in debt.
Our local store closed in 2010 — the year Blockbuster corporate filed for bankruptcy protection — and less than a decade later, almost all of Blockbuster's some 9,000 stores had followed suit. These days, there's only one Blockbuster left on Earth. It's in Bend, Ore., about 820 miles from my home in Los Angeles.
Blockbuster, colloquially known as the Last Blockbuster, is a video rental store in Bend, Oregon. In 2018, it became the last Blockbuster store in the United States, and in 2020, it became the world's last remaining retail store using the Blockbuster brand.
By the late 90s, Blockbuster had reached its peak. With over 9,000 stores worldwide, the company reached a whopping 65 million registered customers and a $3 billion valuation.
Netflix sued Blockbuster last year, saying its larger rival had stolen its system for placing movie selections in a queue and its business method for charging subscribers a monthly fee to select and rent DVDs from its Web site.
How much money did Blockbuster make from late fees?
In fact, late fees were extremely lucrative for Blockbuster — it fetched nearly $800 million a year. So forgetful folks like Hastings were its bread and butter. And when Hastings had to pay a $40 late fee, you can imagine he wasn't too happy. And he knew that many others like him hated paying these fees.
It earned an enormous amount of money by charging its customers late fees, which had become an important part of Blockbuster's revenue model. The ugly truth—and the company's achilles heel—was that the company's profits were highly dependent on penalizing its patrons.
On March 17, 2010, Blockbuster issued a bankruptcy warning after continued drops in revenue threatened its ability to service its nearly $1 billion (~$1.36 billion in 2023) debt load. By April 1, 2010, Carl Icahn had resigned from Blockbuster's board of directors and sold nearly all his remaining Blockbuster stock.
John Antioco was born and raised in Brooklyn, New York. His father was a milkman, whom Antioco would sometimes accompany on his morning delivery route. He is a graduate of the New York Institute of Technology, where he earned a B.S.
Blockbuster competitors include Outerwall, Redbox, Cummins-Allison and The Best of Netflix. Blockbuster ranks 1st in Employee Net Promoter Score on Comparably vs its competitors.
Blockbuster has not confirmed a possible return but the Superbowl commercial and reactivation of its website have social media users talking. "Our 2023 New Year's resolution was to reopen Blockbuster but it seemed like a lot of work so we quit.
Blockbuster Video filed for bankruptcy in 2010, and many thought that was the end of the chain—noted for its brightly lit stores and blue-and-yellow color scheme. A few stores hung on for another nine years, but today, the last Blockbuster store on Earth is in Bend, Oregon.
John Antioco, then Blockbuster's CEO, dismissed the offer, considering Netflix a niche business and downplaying the significance of the dot-com era. In hindsight, Antioco's skepticism about the dot-com bubble was justified, as its subsequent burst demonstrated.
DISH Network acquired the assets of BLOCKBUSTER in April 2011 through a bankruptcy auction. We recognized that the entertainment landscape was changing, and we believe that Blockbuster will continue to evolve its online delivery.
Netflix's co-founder took to LinkedIn to share an awkward encounter with Blockbuster in the 2000s. Marc Randolph said the Blockbuster team tried not to laugh when Netflix pitched a $50 million partnership. Netflix is now worth $149 billion and had 230.75 million subscribers as of the end of 2022.
The chain went bust a decade ago, but throughout its various financial messes, as each store closed one by one, a lone franchise in Bend, Oregon has remained. Owned by Ken and Debbie Tisher and run by Sandi Harding, the relic is a homage to all things pre-digital.
And since Netflix was unprofitable at the time, $50 million might have sounded too high. Blockbuster executives “laughed us out of the room,” Randolph recalled on Twitter on Thursday. But now, “the company that once had 9,000 stores, is down to a single one,” he noted.
As locations around the world closed, the location in Bend held on and became the last remaining store in operation in 2019. Now, it's a fully operational video-rental store (and nostalgia museum of sorts) that's open seven days a week.
At the height of its popularity, there were about 9,000 Blockbuster stores. Now, there is just one. The Last Blockbuster is in Bend, Oregon. Walking into the store is like taking a trip down memory lane: there are rows of movie rentals, yellow walls, candy and snacks and even that familiar “Blockbuster” smell.
Starting August 17 at 1 p.m. PST on Airbnb, Deschutes County residents can call dibs on (aka book) a totally rad, yet intimate slumber party at the world's last BLOCKBUSTER store by requesting to book one of the three individual, one-night reservations that will take place on September 18, 19 and 20.
