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BLOCKBUSTER HURTING IN WAR WITH NETFLIX Tuesday, August 7 2007 Blockbuster may have drawn business away from rival Netflix with its Total Access plan that allows subscribers to rent or return movies at either its stores or via its website, but the plan, according to Barron's magazine, is "killing its bottom line," resulting in a loss of before-taxes loss of $113 million in the last quarter. Barrons quoted Blockbuster CEO Jim Keyes as saying, While we remain committed to capturing market share in the overall (more) NETFLIX SHARES PLUNGE Tuesday, July 24 2007 Only hours after reporting a 50-percent increase in net income for its second-quarter compared to the same period last year, online DVD renter Netflix issued a profit forecast Monday indicating that it expects profits to fall during the rest of the year following its decision to reduce subscription rates and upgrade customer service to compete more effectively against Blockbuster. Shares plunged 12 percent Monday, closing at $17.27. They continued falling today (Tuesday) after an analyst (more) |
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Shares of online video renter Netflix jumped 13 percent in after-hours trading Monday after the company reported earnings of $15.7 million in its third quarter, up 23 percent from the $12.8 million it reported during the same period a year ago. The rise was attributed to the company's decision to lower prices on its most popular subscription plans by $1 per month. The tactic brought 286,000 new customers into Netflix's fold, bringing its total to 7.03 million subscribers, compared to 5.7 million at the end of the third quarter of 2006. The figure is nearly twice the number reported by Blockbuster, which said in June that it had signed up 3.6 million online subscribers. In a statement, Netflix CEO Reed Hastings said, "Going forward we will remain focused on making our core service even better and growing our online DVD rental business, while continuing to invest in our internet delivery initiatives."
