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Gene Kennedy reporting This week, Blockbuster announced a 57- million dollar loss during its' second quarter. Another sign the video rental industry is struggling.
Mom and pop store owners know how this one ends.
Bryce Jolley, Owner, Top Hat Video: "We received the award for the best dying breed."
That "dying breed" is Bryce Jolley's Top Hat Video. One of the last locals left. It's an old Video Vern store still offering an old school aura. VHS tapes abound, but they're literally classics in their own right.
Bryce Jolley, Owner, Top Hat Video: "The days of making a lot of money in video are over."
It goes perfect with this track. Jolley knows he's only staying afloat in a sea of new competition.
Richelle Barber, DVD Buyer: "I would say I haven't rented a movie for a good two years."
Brittany Carpenter, Enjoys Movie Theatres: "I go to movies a lot, dollar movies. (reporter question: “But you don't rent the way you used to?”) “No."
Apparently, neither do many people.
From 2001 to 2004, traditional video rentals plunged more than 20-percent according to Adam's Media Research, Blockbuster just reported second quarter losses of 57-million dollars.
Here is what the company's C-F-O said during a conference call this week.
"So this year the traditional store-based rental industry has declined faster than anyone expected."-Larry Zine CFO.
Larry Coffman, Movie Buff: "It certainly seems like the day has come when you can just download stuff, like the on-demand service Comcast does."
Kagan World Media predicts Cable Video on-demand will grow 400-percent from now to 2009.
Still, according to Blockbuster, it's not the true thorn in the company's side.
The real competition is online, from sites like netflix.com, where you can rent a DVD and they'll just deliver it to your home. Netflix company's profits during its' second quarter doubled what it was in the previous quarter.
Media analysts predict sites likes Netflix will grow almost 190-percent in the next three years.
But get this, in the same amount of time, Kagan predicts online movie viewing, or Web VOD, to boom 730-percent.
In light of this, Blockbuster is focusing the rest of the year on new marketing strategies for its' web site. It certainly raises this queston. If the corporates are hurting, how's Bryce Jolley surviving among the fittest?
Bryce Jolley, Owner, Top Hat Video: "You've got to diversify. You can't rely on just movies. We have a theater we rent out for parties and things. We've got a nice variety of VHS and most of the national chains have gotten away from vhs." "it's nice to be the best of that dying breed."
An industry where there's no "rewind", only "fast-forward."