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Winnipeg Free Press - PRINT EDITION

Blockbuster's Osborne store sees The End

By: Geoff Kirbyson

Posted: 01/12/2011 1:00 AM | Comments: 0 (including replies)

Toby Talbot / the associated press archives The movie-rental giant is battling competitors like pay-per-view and Netflix. (CP)

THE world's biggest movie-rental chain is fading one of its Winnipeg stores to black.

Toronto-based Blockbuster Canada will close its Osborne Street store on Jan. 22 because it wasn't up to snuff.

"We often close individual, under-performing stores as a regular course of business," said Barry Guest, Blockbuster's vice-president and general manager.

The store's windows are full of "going out of business" posters that direct patrons to a pair of nearby locations for future rentals. Inside, shoppers are told everything in the store, including movies, candy and pop, is 30 per cent off.

Once the Osborne location shuts its doors for good, the company will still have 16 stores in Winnipeg. No "major closures" are currently in the works but Guest said all outlets are evaluated on an individual basis.

DVD renters in the Osborne Village area will still be able to get their fix at Movie Village, arguably the most eclectic video store in Winnipeg.

The movie-rental industry has been under siege from all sides in recent years as the Internet, pay-per-view services from cable providers, movies by mail and vending machines contend for the business that used to be dominated by the corner video store.

Blockbuster filed for bankruptcy protection in the U.S. in the fall, a few months after announcing it was voluntarily delisting from the New York Stock Exchange after its share price fell below $1. The company's Canadian operations operate independently from the U.S. business.

Robert Warren, a marketing professor at the I.H. Asper School of Business at the University of Manitoba, said he expects Blockbuster will close as many as six more stores in Winnipeg over the next two years. He said the company will likely focus its efforts on strategic parts of town, where a significant number of residents don't have Internet access.

"The industry has really changed over the last couple of years. Now you can do pretty much everything you want by downloading it over the Internet or video-on-demand," he said.

The Canadian arrival of Netflix this fall is likely putting a big dent in Blockbuster's revenues, even though its stores get movie titles 28 days before the U.S.-based subscription service -- where people pay a monthly fee to stream movies and television shows to their televisions and computers -- does, he said. Warren said he expects Blockbuster will soon attempt to fight fire with fire in Canada by enabling users to download movies from its website.

Warren said he believes Blockbuster has seen the writing on the wall for some time as it has spent very little to upgrade its stores in recent years. This isn't the first time a big-box retailer has reduced its operations in Winnipeg. Jumbo Video used to have a half-dozen stores in Winnipeg during its heyday in the mid-1990s but just one remains today.

geoff.kirbyson@freepress.mb.ca

Republished from the Winnipeg Free Press print edition January 12, 2011 B4

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