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Wednesday July 25, 2007 3:58 pm

Netflix Stock Plummets


Blockbuster logoboxing glovesNetflix logo

If you are a Netflix devotee, you may have noticed that the site was down for over 12 hours this week, but what you may not be aware of is the fact that their stock price hit the lowest it has in over two years. Lowering monthly fees by $1.00 and thereby losing profits is one of the company’s attempts to compete with the mega-giant Blockbuster. Yesterday their stock dropped to $15.62 then rebounded to $16.10 (a loss of 6.8%) as an indication of stockholders’ distress. Statistics also indicate that last month they had a decrease of 55,000 subscribers since April. They may lose even more profit as they invest in new tech to allow online movies that can be viewed on TV via high-speed Internet connections.

The company has had its share of problems since Blockbuster offered the option to swap DVDs at their stores instead of waiting for the mail. We love Netflix for its originality and are not thrilled with the fact that they may be knocked down because of that glorious concept known as competition. We have watched our neighbor video stores crumble because of Blockbuster’s large scale takeover efforts and hope that the beleaguered rival can take a bite back and retain its standing.

 


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Comments:

I can’t stand Blockbuster. They rape you over the smallest things. Like of course being late. They had creditors chase me down over a two day late fee that wasn’t payed. They threatened to mark my credit rating over a couple of bucks. Threatening customers is not a good way to keep them coming back. My favorite movie rental store Hollywood Video has closed down in our neighborhood. They at least were a little more forgiving to their customers in regards to late fees. Since Hollywood Video closed its doors in out neighborhood we have decided to get all of our movie rentals from Net Flicks. With my sour history from Blockbuster, and their credit chasing freaks I desperately hope that Net Flicks stands tall through this assault from Blockbuster. I can’t stand Blockbuster. Maybe they should change their name to ballbusters.

You can’t argue with the convenience Blockbuster offers, but their selection still leaves much to be desired.  If I need a specific film, especially a new release, I find I’ll spend more time and energy trying to obtain it from Blockbuster (either in-store or online) than I do just waiting patiently for the mail and Netflix.

Not only that, but Blockbuster’s Blu Ray loyalty has excluded thousands (including myself) from the convenience of renting HD in-store.

Once the novelty and brand leverage wear off, Blockbuster will no longer be a threat.


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