Blockbuster to Dish Network: Pay the Cashier
Dish Network announced early this morning that it had won the Blockbuster assets in the bankruptcy-court sanctioned auction.
The auction began in court early April 5 and then moved to a “closed door” session. Those bidding besides Dish Network included Carl Icahn who owns a considerable investment in Blockbuster and a group of liquidators and the aligned creditor group known as Cobalt Video.
What Will You Bid for Blockbuster?
April 4 is a big day for Blockbuster. The U.S. bankruptcy court has approved an auction where the highest bid will take the fading home video rental company. Blockbuster is currently reporting a $68.4 million loss for the first two months of 2011.
Bidders include Carl Icahn, South Korean Telecommunications company SK Telecom, Dish Network and Cobalt Video holdings, a group of hedge funds that put forward the February 21 $290 million bid.
Blockbuster is thought to be a potential “brand” for on-demand platforms sought by both SK Telecom and Dish Network. The Blockbuster licenses with movie studios and television producers would give either Dish Network or SK Telecom a competitive package to Netflix. One added advantage provided by Blockbuster is an earlier window on theatrical releases.
NetFlix Plans to Develop Own Content
[Update: House of Cards will indeed debut on Netflix. Netflix has committed to a minimum of 26 episodes of the Media Rights Capital drama, which is expected to be available to its subscribers beginning in late 2012. See the press release here.]
Netflix is in advanced negotiations with two of Hollywood’s biggest names for an original show. Netflix is bidding on the exclusive rights for a two-season, 26-episode remake of the British political drama House of Cards, starring Kevin Spacey and directed by David Fincher. Fincher is best known for directing the Oscar-winning movie The Social Network. Several major cable networks are also interested in the show including AMC and HBO.
Deadline.com, which first broke the story, noted that the deal could be worth more than $100 million. Under the terms being discussed, Netflix would have the right to distribute the series online before any other outlet carried it; however, Media Rights Capital, the company which owns the rights to the show, would be allowed to make arrangements for later broadcast or DVD sales.
Netflix is clearly the market leader in video on demand (VoD) and DVD rentals, finishing 2010 with more than 20 million subscribers and boasting a constant and user-friendly streaming presence in the home though its many connected devices.
Earlier this week market research firm NPD Group Inc. issued a report saying the Netflix accounted for 61% of all digital movie streaming—including rented movies acquired over the Internet and purchased through Apple Inc.’s iTunes and cable video on demand services—during the first two months of this year. Comcast Corp. was in second place with 8%, while DirecTV, Time Warner Cable and Apple were tied for third place with 4% each. Read more
New Option for Dish Network?
Could Dish Network be working on a product that will allow it to stream programming over the Internet in the same way it delivers content via satellite? Dish Network CEO Charles Ergen told reporters last week that the company is in talks to expand its rights to do just that.
Without announcing a new development plan for an Internet product, Ergen did describe current discussions and a study that may result in a product aimed at viewers that must use the Web to access entertainment. Ergen acknowledged that some programmers run the risk of damaging their conventional distribution products.
Could Netflix Lose Subscribers?
A poll conducted by The Diffusion Group indicates that if the Amazon Prime movie streaming product is comparable, roughly 32% of the Netflix subscriber base would choose Amazon.
Amazon has indicated that it will make approximately 5,000 titles available for streaming and would include them with no additional fee in the Amazon Prime program. Amazon Prime requires a $79 annual fee.
Two thousand Internet households were included in the survey which consisted of two questions concerning Netflix and Amazon. Of the Netflix subscribers who also have Amazon Prim memberships, 36.2% indicated they would drop Netflix while 32.6% indicated a willingness to use both services.
While most of the attraction to the Amazon product may be the perception that it is going to be less expensive, Netflix could be looking at a substantial loss in its subscriber count.
VOTW: Roku Serves 1 Billion Users and Counting
And last but not least, our video of the week (VOTW), courtesy of Viodi TV.
Brian Jacquet, director of marketing for Roku, discusses who is using their product and how they got to 1 billion views and 11 hours per week of playing time per device, while speaking at the Broadband Unlimited Conference at CES 2011. Interestingly, Roku’s demographic tends to be older and less geek-like than the typical over-the-top video viewer. He also suggests that sales have increased as awareness of over-the-top video to the television has increased.
[Note: the quality level of this particular video isn't the best, as it was filmed from the moderator's perspective with a handheld Kodak Zi8 camera using its internal microphone.]



