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Retail

Blockbuster UK appoints administrators

Blockbuster UK appoints administrators

Wed 16 Jan 2013 2:34pm GMT / 9:34am EST / 6:34am PST
Retail

"Core of the business is still profitable" says Deloitte

Rental firm Blockbuster UK has appointed Deloitte's Lee Manning, Matthew David Smith and Neville Kahn as joint administrators, just days after UK retailer HMV.

"In recent years Blockbuster has faced increased competition from internet based providers along with the shift to digital streaming of movies and games," said Manning.

"We are working closely with suppliers and employees to ensure the business has the best possible platform to secure a sale, preserve jobs and generate as much value as possible for all creditors."

"The core of the business is still profitable and we will continue to trade as normal in both retail and rental whilst we seek a buyer for all or parts of the business as a going concern. During this time gift cards and credit acquired through Blockbuster's trade-in scheme will be honoured towards the purchase of goods."

The company employs around 4000 in the UK, both at stores and through its online business blockbuster.co.uk. It's first UK store opened in 1989.

27 Comments

Craig Burkey
Software Engineer

148 105 0.7
The rate at which UK retail competition is dying out, a Steam box looks the more likely to be my Next Gen console of choice, I know its linux out the box but stick win7 on there and have all the digital portals available, I'd hate to live in a world where the only place to buy a new game is Xbox's Games on Demand

Posted:A year ago

#1
We commented in the HMV discussion that this was looking like a spate of retail collapses reflecting a bigger issue and a whole hoard of comments stated this was not true and we were mad to suggest this! Denial is a dangerous thing guys!

I agree with Craig that the SteamBox / PC DLC approach could be a major plus for those mature players that have abandoned waiting in cues at retails stores - I would expect additional delays from the Gen-8 console releases to bolt-on a better online sales machine. As one discussion covered, UK sales seem to support the US price discount on content. Just wonder how MCV will survive with no retailer chains to support?

Posted:A year ago

#2

Bruce Everiss
Marketing Consultant

1,716 598 0.3
Zavvi, Woolworths, Game, HMV, Blockbuster.
Surely by now even those in denial can see that it is not a coincidence.
Plastic and cardboard distribution of digital content is silly and will very soon be history.

Once games become digitally distributed they can become a service, which is far better for both developer and customer, more like with MMOs. And far more flexible business models are available, an area where there is much exciting new development.

Don't be sad. The game industry is booming like never before. Vastly more people playing games than ever before, to the point of ubiquity. Hundreds of new games published every week. Creativity unleashed like never before. These are the golden days.

Posted:A year ago

#3

Paul Smith
Dev

195 155 0.8
Online retail is still going strong Bruce! Its just the high street chains which are failing because their prices are stupidly high, I saw final Fantasy 13-2 in Hmv for 44 today.

Posted:A year ago

#4

Bruce Everiss
Marketing Consultant

1,716 598 0.3
@Paul Trillo

Like Play.com?

Posted:A year ago

#5

Craig Burkey
Software Engineer

148 105 0.7
The MMO model isn't exactly working out great though is it? Most have had to convert to F2P to remain in existence, which brings with it a load of unliked monitisation techniques

Posted:A year ago

#6
would be interesting to see how PS4, and next xbox get sold...

Posted:A year ago

#7

Bruce Everiss
Marketing Consultant

1,716 598 0.3
@ Dr. Chee Ming Wong

In Tescos, Sainburys, Asda, Morrisons etc

Posted:A year ago

#8

Paul Smith
Dev

195 155 0.8
@Bruce That's not because of lower demand they stopped selling new because of tax laws.

Edited 1 times. Last edit by Paul Smith on 16th January 2013 5:06pm

Posted:A year ago

#9
"The game industry is booming like never before. Vastly more people playing games than ever before, to the point of ubiquity. Hundreds of new games published every week."

And how many of those make money?

Posted:A year ago

#10

Dan Howdle
Head of Content

272 761 2.8
I agree with Bruce. The writing's on the wall, but the only reason to be sad is for those who lose their jobs. I look forward to the day when games are delivered digitally and instantly.

Posted:A year ago

#11

Paul Smith
Dev

195 155 0.8
And how many of those make money?
All the great original titles do. :)

Edited 1 times. Last edit by Paul Smith on 16th January 2013 5:18pm

Posted:A year ago

#12

Sandy Lobban
Founder and Creative Director

319 178 0.6
@Paul Trillo @ Bruce

Play.com don't keep products any more. They are purely a market place. Wise move!

When times are tight, everyone goes to the cheapest. Home based business's will be the stock holders of the future with their zero overheads.

Edited 1 times. Last edit by Sandy Lobban on 16th January 2013 6:15pm

Posted:A year ago

#13
At east now we are talking about it as happening rather than denying anything is wrong and it is just high-street rental prices!

I would be interested in the first CD duplication, localization and marketing firm to reflect this change in retail media sales and go into administration?

Again, my hopes that those left without employment find new positions quickly.

Posted:A year ago

#14

Marty Greenwell
Software Developer

56 38 0.7
Yeah, Amazon is really struggling .

iTunes has been around since 1998 and CDs haven't died out yet; the death of boxed games is massively overstated, for a number of reasons. Demand, broadband speeds and availability limiting your market reach, ISP caps (turns out BE doesn't like Netflix in HD). They'll be around for the next decade or more.

Posted:A year ago

#15

Andrew Goodchild
Studying development

1,199 317 0.3
Did comet go bust because people are downloading fridges and TVs?
Downloads do add a source of competition, but all high street retail in the UK is suffering unless it offers an experience. Apparently the UK has the biggest percentage of its economy online of any country, and Supermarkets will happily sell attention grabbing product areas at minimal profit or even loss to get people through the door.
I remember being in Waterstones when a Harry Potter book came out, and speaking to one of the staff. What should be the biggest week of the year for them, racks of books that fly off the shelves, makes them a massive loss. They have to sell at half price because Tescos, Asda and WH Smith are. But Waterstones can't afford being the place you avoid for the big event titles.
If Tescos weren't selling many games, they wouldn't dedicate shelf space to them (they may be prepared to take a loss on a popular product, but not on a turkey), this tells me people are picking games off shelves, just not on the high street.

Edited 1 times. Last edit by Andrew Goodchild on 17th January 2013 6:40am

Posted:A year ago

#16

Dave Herod
Senior Programmer

517 731 1.4
Why is it Bruce always refers to hundreds of thousands of games being churned out as a good thing? Even if every one of them was free, who has the time to sit weeding through mountains of junk to find anything vaguely entertaining?

Posted:A year ago

#17

Bruce Everiss
Marketing Consultant

1,716 598 0.3
Choice.
Just like there are a lot of books.
You don't have to read them all, just the ones you want to.

Posted:A year ago

#18

Dave Herod
Senior Programmer

517 731 1.4
Even books have normally been through some kind of filter by a publisher deciding whether it's even worth publishing. Isn't that one of the arguments you always give for publisher relevance? That they weed out the rubbish? Who's weeding out the rubbish from the mobile app stores? No one, it seems. When I've looked for decent games I've found myself so overwhelmed with garbage I decided I can't even be bothered to look any more.

Posted:A year ago

#19

Bruce Everiss
Marketing Consultant

1,716 598 0.3
Who is weeding out the rubbish of the vast number of self published books?
These have been published for ages, going back into history and now they have exploded in numbers due to digital distribution.

http://en.wikipedia.org/wiki/Self-publishing

Posted:A year ago

#20

Sam Brown
Programmer

237 163 0.7
@Bruce: Yes, but on the whole bookshops like Waterstones do not stock self-published books - which is another filter.

Posted:A year ago

#21

Dave Herod
Senior Programmer

517 731 1.4
Which is probably why I haven't read any self-published books and tend to stick with authors I know I like, like Stephen King or Terry Pratchett. The problem with the mobile platforms is that there are no names on there that I know I like. If I start at the obvious place and try the top selling/downloaded/grossing games, they become a self-fulfilling thing - I'm one of those billion or so that downloaded Angry Birds, but that's because it's right there as the most obvious place to start with. But on playing it I thought it was absolute rubbish and deleted it. But I've already contributed to that number of downloads by that point. So I've helped push it to the top despite thinking it was crap. This is why I gave up on mobile games. I can't find anything good because there's so much noise and very little signal.

Posted:A year ago

#22

Sam Brown
Programmer

237 163 0.7
You need to have some quality control, otherwise the signal-to-noise ratio just gets too ridiculous. We all know how hard it is to stand out in the app stores.

Previously, quality control came from the fact that getting anything to market in the first place was costly and hard, but now that is no longer the case we have to have another means. Back in the 1990s, just as MP3s were taking off, the concept of netlabels appeared - essentially record labels giving stuff out for free (because most of the original ones came from the demoscene). You may not know all the artists on them, but like any physical non-major record label you know that they're likely to be similar to the artists you do know on there, and that they'll be reasonably high-quality because the label wants to keep its reputation.

So why not have app stores that do similar? Say, ones that specialise in old-school RPGs, or in FPS, or whatever?

Edited 1 times. Last edit by Sam Brown on 17th January 2013 10:49am

Posted:A year ago

#23

John Bye
Senior Game Designer

477 434 0.9
Popular Comment
Retail is suffering across the board in the UK, thanks to a combination of a long, hard recession, high rental costs, and ever increasing competition from online retailers and supermarkets. Bruce lists Zavvi, Woolworths, Game, HMV and Blockbuster. I could just as easily list Jessops, JJB Sports, Clinton Cards, Peacocks, Barratts, La Senza, Focus DIY, Hawkin's Bazaar and Habitat, all of which have gone into administration in the last couple of years, and none of which sold videogames.

It's a bloodbath out there, whatever you're selling.

Also, that list is rather misleading. My local Woolworths had more shelf space dedicated to plastic buckets than videogames, not to mention their famous pick-and-mix sweets counter, and Zavvi and HMV are/were both primarily music and (later) DVD retailers. My local HMV has less than an aisle for games (a lot of them second hand), two aisles for blu-rays, three or four aisles for DVDs, and the other half of the store is given over to CDs, with a few books, calendars and t-shirts thrown in. A combination of iTunes, Amazon and (more recently) Lovefilm and Netflix has taken most of that business.

Blockbuster has the same problem, with streaming and postal rental services taking most of their business. I expect games are a small part of their business. Hell, I didn't even realise they sold new games at all. They're a video rental store, why would anyone go there to buy a game? Saying that a decline in games retail killed Blockbuster is like saying that Comet went bust because they had a shelf hidden away at the back of the store selling games.

Also, while the games industry is definitely swinging towards digital delivery of games, all three console manufacturers already have digital stores, and Sony in particular have really got their act together in this regard in recent years, from PlayStation Plus to day-and-date digital and retail releases and competitive pricing on back catalogue titles. Even Nintendo, who are still struggling to get their heads around this newfangled interweb thing, are apparently doing great business on some Wii U digital titles. Ironically it's Microsoft who are lagging behind now, after the great start Xbox Live gave them. And of course PC gamers have Steam, which has been massively successful over the last few years.

There's a wonderful range of games out there - Assassin's Creed, Call of Duty, Just Dance, Journey, Angry Birds, Clash of Clans, whatever. Let's celebrate that variety, instead of jumping up and down in our seats hoping that most of that business is going to be wiped out overnight, leading to hundreds of thousands of job losses and the tens of millions of gamers who still love playing console games being left out in the cold.

Posted:A year ago

#24
"There's a wonderful range of games out there - Assassin's Creed, Call of Duty, Just Dance, Journey, Angry Birds, Clash of Clans, whatever. Let's celebrate that variety, instead of jumping up and down in our seats hoping that most of that business is going to be wiped out overnight, leading to hundreds of thousands of job losses and the tens of millions of gamers who still love playing console games being left out in the cold."

Really well put.

Posted:A year ago

#25

Paul Jace
Merchandiser

770 1,005 1.3
I thought all Blockbusters had shut down by now. But perhaps that was just a US thing.

Posted:A year ago

#26

Preet D Bass
student

93 13 0.1
I can bet all them companies, didnt think for one second that china would we king of manufacturing & that the internet would change everything. All the companies that suffer (UK many that I can talk about) retail wise have either been ripping customers off & didnt see the scale of the internet. I mean Apple wouldnt be so big if it wasnt for there iTunes & iPod, ebay made trading & auctioning easier, Amazon made buying books easier, etc. All the companies that didnt see the internet as a threat got burned & those that did see it as an opportunity replaced them.

Posted:A year ago

#27

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