Blockbuster pitches service to telco companies

Video Business

By Danny King -- Video Business, 1/7/2009 12:06:00 PM

Blockbuster CEO Jim Keyes said today that his company, which is expanding its digital delivery business, would be a "good partner" for telecommunications companies with TV services, such as Verizon's FiOS and AT&T's U-Verse, that are looking to compete with cable companies for video-on-demand sales. Keyes also said Blockbuster is looking to sell some of its overseas stores but would retain digital-delivery rights in those territories.

"We represent a good partner for others," Keyes said at the Citigroup Global Entertainment, Media and Telecommunications Conference in Phoenix today. "Perhaps it's Verizon or AT&T selecting Blockbuster to compete with cable."

Keyes didn't say if Blockbuster had discussed a possible partnership with those companies.

Blockbuster recently started selling a set-top box that plays digital downloads from Blockbuster.com directly on consumers' TV sets, allowing the largest U.S. movie-rental chain to compete directly with Netflix, Amazon.com and Apple in the digital content delivery field. Keyes said that it Intel was developing a television component that would allow the downloads to be viewed from TVs without a set-top box, though didn't specify any television brands that would have the component.

Blockbuster integrated what had been known as its Movielink digital download service into its own Web site in July, almost a year after Blockbuster bought the service from the five major studios for $6.6 million.

Keyes added that, although the company was looking to sell some of its overseas stores, it would retain digital-delivery rights in those territories such as the U.K., continental Europe and South America to capitalize on the growing number of people expected to rent or buy titles over the Internet, which he estimated would be a $2 billion industry by 2012. Blockbuster gets about a third of its revenue from outside of the U.S.