Blockbuster bids for Circuit City

Blockbuster bids for Circuit City
Movie rental giant Blockbuster announced on Monday that it has made an offer for struggling consumer electronics retailer Circuit City. The second biggest consumer electronics chain in the United States, Circuit City questioned whether or not Blockbuster would be able to finance a deal. Blockbuster said that such a merger would provide a chain to sell electronics products alongside entertainment for them.

Blockbuster Chief Executive James Keyes said the offer is supported by board member Carl Icahn, who could be a source of financing. The rental chain has struggled to complete in Online rentals with leader Netflix for the past couple of years. Now it wishes to entice Circuit City shareholders for support.



Circuit City has advised shareholders to take no action until the board has had a chance to review the bid appropriately, which would see Blockbuster paying more than $1 billion for the chain. Circuit City shares climbed 30 percent in afternoon trading following the announcement.

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Written by: James Delahunty @ 14 Apr 2008 20:09
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  • 26 comments

  • svtstang

    When this news feed passed at work today I had a nice chuckle! Two bad franchises potentially coming together to make...an even worse franchise, what an awesome idea! At least the poor people holding stock in Circuit City saw some relief today. And yes both companies are doing horrendous, just look at comparison charts regarding stock value between Circuit City/Best Buy and BB/Netflix.

    I dont get it :/

    14.4.2008 20:49 #1

  • iluvendo

    Originally posted by svtstang: When this news feed passed at work today I had a nice chuckle! Quote:Two bad franchises potentially coming together to make...an even worse franchise, what an awesome idea! At least the poor people holding stock in Circuit City saw some relief today. And yes both companies are doing horrendous, just look at comparison charts regarding stock value between Circuit City/Best Buy and BB/Netflix.

    I dont get it :/
    Only in America !

    If it wasn't for bad luck, I'd have no luck!
    "The flimsier the product,the higher the price"
    Ferengi 82nd rule of aquisition

    14.4.2008 20:55 #2

  • PantherM

    I'm not sure about this marriage....

    14.4.2008 21:00 #3

  • sgriesch

    I used to work at Circuit City back in the commission days. This bonehead move just follows suit to the others that I have seen over the past 10 years. It may not be officially done yet, but if it were to go through, it would be because the CEO's of Circuit City are cashing out while they still have something to sell.

    14.4.2008 21:45 #4

  • snowlock

    i don't think it would work very well, but i really wouldn't know.

    then again, the merger of two dying giants could be a good thing for both.

    14.4.2008 21:48 #5

  • ZippyDSM

    Originally posted by snowlock: i don't think it would work very well, but i really wouldn't know.

    then again, the merger of two dying giants could be a good thing for both.    if they would easily share their stock with each other and be able to buy and reorder stuff from each other it would be great but these mergers never go to well for the average consuemr it just means the status quo will continue...

    15.4.2008 02:15 #6

  • ZoSoIV

    instead one one company going down in flames now two will lol

    15.4.2008 03:02 #7

  • jookycola

    It's sad. Circuit City killed it's self with over pricing their stuff. Best Buy kills them in price everytime. and Blockbuster has the same business model of overpricing themselves out of business.

    Also just like Blockbuster never comes off with an original idea...instead they copy a competitors idea and try to tweak it so they can still somehow over price it. In the end they completely fail at it and end up hurting themselves more by pushing away customers that are smart enough to know they’re getting the better deal at the competition. Circuit City does this too (Firedog anyone?)

    So they deserve each other. However I still would shop at Circuit City from time to time because they sometimes have items you can’t get elsewhere. But once the merge with Blockbuster, they are dead to me. I will never again give my money to the crooks at Blockbuster.

    15.4.2008 09:54 #8

  • nopcbs

    Actually, at the moment I think pricing is as good at CC as at BB...certainly for TV's.

    They hurt themselves with their salesman commission model that scares off customers vs. BB. They also always seem to have less approachable/friendly sales-people than BB. On the other hand, in my experience, they have much better displays of TV's.

    15.4.2008 16:33 #9

  • milkyoreo

    interesting... circuit city IS having a lot of trouble now, Best Buy has taken over

    15.4.2008 16:42 #10

  • emugamer

    I will be getting my next HDTV at Circuit City. Only because I don't have a credit card with them, and even though I will have the cash for it, opening a card would give me 10% off. I hope they are still around by then :P

    I hate Blockbuster. I recently rented a PS3 game there. It was crap. So I returned it the next morning (less than 24 hours). I asked if I could switch games and the middle aged lady shook her head and pointed up to their "monthly gamers plan" which was scribbled in chalk on a chalkboard. I should have joined that she told me. For $21/month, I could have taken out as many as I wanted, 1 at a time. So I left the store feeling like I just threw $8.00 down the sewer. Not a good way to treat a customer. Especially a business that is hurting like they are. I would have signed up if I would have seen the deal or been made aware of it when I rented the game to begin with. What she could have done is apply the $8.00 I spent to the cost of the monthly fee and let me join for a month. Instead, she lost my future business. No more game rentals from BB for me. And then I asked if they had a bluray selection yet. Of course not. So I'm going to subscribe to Netflix now and just rely on downloading free demos of games I want to try out if they are available.

    15.4.2008 16:55 #11

  • TSRSteve

    I've always bought stuff from both Best Buy & CC depending who had the better price. Both will rip you a new one on non sale items. Circuit City's customer service is deffinently lack something.

    As for Netflix & Blockbuster I prefer Blockbuster because their distribution center is closer and I only have a one day turn around on movies by mail. Blockbuster's game rentals are a major rip off, I agree 100% on that.

    Gamefly is the way to go on game rentals though. For the price of one game you can have almost four months of their serivce. After buying F.E.A.R. I vowed never to buy another game without renting it first.

    15.4.2008 18:13 #12

  • loxley32

    Emugamer ... what a load of crap. You hate Blockbuster because you rented a game and didn't like it? Give me a break. Try going to McDonald's (or anywhere else to eat) and order cheeseburger. Eat half and then go back up the counter and tell them you really don't want the cheeseburger anymore. Ask them to give you half price off the next burger you buy instead. Post the results of this conversation you have with the food person here, please.

    16.4.2008 00:19 #13

  • emugamer

    Originally posted by loxley32: Emugamer ... what a load of crap. You hate Blockbuster because you rented a game and didn't like it? Give me a break. Try going to McDonald's (or anywhere else to eat) and order cheeseburger. Eat half and then go back up the counter and tell them you really don't want the cheeseburger anymore. Ask them to give you half price off the next burger you buy instead. Post the results of this conversation you have with the food person here, please.loxley32 ... what a load of crap. Your illustration is completely unrelated. Perishable vs non-perishable. Try thinking first. I'm not going to Blockbuster because of what I feel was poor customer service, not because of a game. Read carefully. And I should have mentioned that this was the straw that broke the camels back. I've had less than stellar service there. I'd rather deal with an online checkout system than with their employees I've encountered. If they would have tried to work with me, I would have been more inclined to give them more business. Give the customer a little and they will come back for more. It wasn't asking for much in the grand scheme of things. They would have still received $21 from me, and in the end, I probably would have subscribed for another month or rented a bluray when available. So don't give me that crap about a half-eaten burger. That's just low class.

    16.4.2008 06:11 #14

  • SProdigy

    emugamer, having worked at a Hollywood chain, I can see both sides of the story, however, the standard rental model is not "all you can eat" like their subscription plan.

    Basically to have them exchange the game you rented, more than likely would be flagged as a free rental in their system, and you would get an extra day on a game. In this day and age where people copy/backup everything, I'm sure they are pretty strict on things like this.

    And for a better comparison, go buy a game or DVD and try returning it for something OTHER than the same copy of said game or DVD. Not gonna happen.

    16.4.2008 16:05 #15

  • snowlock

    Originally posted by SProdigy: ...go buy a game or DVD and try returning it for something OTHER than the same copy of said game or DVD. Not gonna happen.true.

    even walmart doesn't do refunds on open media,
    and they have the best (loosest) return policies anywhere.
    you can buy a brand new game system from walmart,
    keep and play it for a month then return it for a full refund.

    16.4.2008 16:22 #16

  • emugamer

    Originally posted by SProdigy: emugamer, having worked at a Hollywood chain, I can see both sides of the story, however, the standard rental model is not "all you can eat" like their subscription plan.

    Basically to have them exchange the game you rented, more than likely would be flagged as a free rental in their system, and you would get an extra day on a game. In this day and age where people copy/backup everything, I'm sure they are pretty strict on things like this.

    And for a better comparison, go buy a game or DVD and try returning it for something OTHER than the same copy of said game or DVD. Not gonna happen.    Thanks for the info. The standard rental model makes sense. Yeah, I'm pretty aware about the policies surrounding all media (movies, games, CD's). It's a shame about that. I guess I was thinking it wouldn't make a difference with a PS3 game since backups are useless. But I guess if there is a rental model, it pretty much applies to all things. I just wish she would have pointed out the subscription plan when I first rented it.

    Anyway, back on topic, there is a Circuit City where I live directly across the street from a Best Buy where I live. Circuit City is pretty much dead compared to the crowd in Best Buy. And the B&M Blockbusters near me are pretty much the same. Blockbuster teaming up with Best Buy (not buying them) would probably be a more practical business choice I would think.

    16.4.2008 16:26 #17

  • ZippyDSM

    Quote:Originally posted by SProdigy: ...go buy a game or DVD and try returning it for something OTHER than the same copy of said game or DVD. Not gonna happen.true.

    even walmart doesn't do refunds on open media,
    and they have the best (loosest) return policies anywhere.
    you can buy a brand new game system from walmart,
    keep and play it for a month then return it for a full refund.    What most people don't recall is that the industry both publisher and retail got together and created the whole on return thing for new media, this blanket martial law ban has empowered the system to maintain a status quo and further develop the casual market, IE we can make all the crap we want to and the consumer is stuck with he bill.

    this is why I never buy new anymore and fight for my consumer and fair use rights every chance I get.

    16.4.2008 16:30 #18

  • snowlock

    Quote:Quote:Originally posted by SProdigy: ...go buy a game or DVD and try returning it for something OTHER than the same copy of said game or DVD. Not gonna happen.true.

    even walmart doesn't do refunds on open media,
    and they have the best (loosest) return policies anywhere.
    you can buy a brand new game system from walmart,
    keep and play it for a month then return it for a full refund.    What most people don't recall is that the industry both publisher and retail got together and created the whole on return thing for new media, this blanket martial law ban has empowered the system to maintain a status quo and further develop the casual market, IE we can make all the crap we want to and the consumer is stuck with he bill.

    this is why I never buy new anymore and fight for my consumer and fair use rights every chance I get.    no offense since i totally agree and support your stance, but...
    it ain't happenin: it will stay that way with media since they've gotten away with it this long.

    16.4.2008 16:39 #19

  • goodswipe

    Quote:Anyway, back on topic, there is a Circuit City where I live directly across the street from a Best Buy where I live. Circuit City is pretty much dead compared to the crowd in Best Buy. And the B&M Blockbusters near me are pretty much the same. Blockbuster teaming up with Best Buy (not buying them) would probably be a more practical business choice I would think.Didn't Block Buster team up with Radio Shack or someone like that? I remember going to a BB in Houston, that had a Radio Shack in it. Or vice versa.
    "look honey, it said goodswipe! oh wow, that's amazing."

    16.4.2008 16:39 #20

  • emugamer

    Quote:Quote:Anyway, back on topic, there is a Circuit City where I live directly across the street from a Best Buy where I live. Circuit City is pretty much dead compared to the crowd in Best Buy. And the B&M Blockbusters near me are pretty much the same. Blockbuster teaming up with Best Buy (not buying them) would probably be a more practical business choice I would think.Didn't Block Buster team up with Radio Shack or someone like that? I remember going to a BB in Houston, that had a Radio Shack in it. Or vice versa.Hmm...never saw that in NY.

    16.4.2008 16:49 #21

  • goodswipe

    Yea, here's an article..

    http://findarticles.com/p/articles/mi_m0..._27/ai_70896525


    Quote:The companies will launch Phase I of the concept in approximately 130 selected Blockbuster stores in four markets, which is planned to be followed by a Phase II nationwide rollout of the company's remaining stores in 2002. Completion of the approximate 130 stores is expected by this summer and will include the markets of Las Vegas, Nev., Norfolk, Va., Austin, Texas, and Tulsa, Okla. RadioShack's highly trained sales associates will manage the stores within Blockbuster, which will offer and educate consumers on the latest digital entertainment products including home electronics, telephony services, high-speed Internet access and emerging connectivity technologies along with other fun gadgets.So it's kind of like they have already tried this and from what I've seen, it hasn't done very well. So will this buyout actually help?

    **update**

    Hah, BB is owned by Viacom. Viacom as you know, owns Nickelodeon, VH1, BET, Paramount Pictures, MTV and a bunch of other things. Seems like with all those successful businesses/corporations they got going, they could think of some ways to keep BB going.
    "look honey, it said goodswipe! oh wow, that's amazing."

    16.4.2008 17:06 #22

  • ZippyDSM

    Originally posted by goodswipe: Yea, here's an article..

    http://findarticles.com/p/articles/mi_m0..._27/ai_70896525


    Quote:The companies will launch Phase I of the concept in approximately 130 selected Blockbuster stores in four markets, which is planned to be followed by a Phase II nationwide rollout of the company's remaining stores in 2002. Completion of the approximate 130 stores is expected by this summer and will include the markets of Las Vegas, Nev., Norfolk, Va., Austin, Texas, and Tulsa, Okla. RadioShack's highly trained sales associates will manage the stores within Blockbuster, which will offer and educate consumers on the latest digital entertainment products including home electronics, telephony services, high-speed Internet access and emerging connectivity technologies along with other fun gadgets.So it's kind of like they have already tried this and from what I've seen, it hasn't done very well. So will this buyout actually help?

    **update**

    Hah, BB is owned by Viacom. Viacom as you know, owns Nickelodeon, VH1, BET, Paramount Pictures, MTV and a bunch of other things. Seems like with all those successful businesses/corporations they got going, they could think of some ways to keep BB going.    ya but tis radio shack, the main trouble with RS is that the American populace no longer builds tings and RS has a 30%+ mark up on stuff making you wonder why china gods are not cheap.

    I mean really if RS would drop prices by 30-50% they would get more traffic.


    speaking of RS,whats a good RS like store that all has them bit and bobs? the one here closed down due to the plague known as wallmart and I need to get some odds and ends no one else carries here.. I dont want to pay shipping ontop of RS prices at thier website.


    as for making BB "work" heres a thought 5$ rents a DVD for up to 2 months, the DVD needs to be returned in that time frame or you will be charged the going rate for a new DVD.
    If you just want it for a day thats 2$ for 24 hours with a 12 hour grace period before being charged 3$ and it slotted to the 2 month plan.

    Games are handled the same FCKING way, when you rent 3 games theres a 5$ deposit on the 3rd one and 5$ for each there after ,once you return them you are refunded the money, this is better than over charging BS they do for games currently.

    One could also use a rain check system where for 2$ you can have them hold something that was out for 2 days, having a intuitive system thats not insanely overpriced but seeks to provide a premium service at cost will do them far more good than the mindless drooling price fixing they have going on now....

    BTW about BBonline, heres how I can see it being good for 15$ you get a take home to the store plan,1 at a time unlimited, you get it through the mail and return it to the store, it also lets you rent from the store 2 discs at a time within 24-30 hours of each other.

    For 25$ you get either 4 at a time or 1 movie 1 game which translates to 5 at the store in a 1 a day in the week allotment(7 a week Sunday to Sunday or 15 hours per disc) or 2 movie and 1 game or 2 games alone in a 30 hour period.


    To return these to the online system you about pay a buck a disc

    For 39$ you get 8 DVDs or 4 games (games count as 2 dvds) in a 20 hour period, return to the online system is free of charge.

    Both these let you rent something at the store for free and give you 90 days before the system warns you of a late return at 110-120 days you are charged the price of the time to be refunded on the return of the item minus a 1$ handling fee.

    BB needs to up turn around but handle saturation control as well and treating games the same as movies or at least 2 movies in the form of 1 game, BB still has teeth left in it but without the correct plans , consumer freindlyness and low but firm prices BB will fail.

    Also a 50$ gold membership plan that removes the deposit and other fees and increases the warn date on rentals would not be a bad idea, renew it for 10 every 20 months and send them 30$ worth of coupons a year to finish it out if need be.

    For all the console/game fanboys out their.
    http://www.escapistmagazine.com/articles...Console-Rundown
    Oh god I can't stop laughing!!!
    ---
    And for the format nazi's I bring you HHD DVVD BVD's!!

    16.4.2008 22:10 #23

  • goodswipe

    Quote:speaking of RS,whats a good RS like store that all has them bit and bobs? the one here closed down due to the plague known as wallmart and I need to get some odds and ends no one else carries here.. I dont want to pay shipping ontop of RS prices at thier website. Hmm, maybe try Monoprice?
    "look honey, it said goodswipe! oh wow, that's amazing."

    17.4.2008 10:11 #24

  • ZippyDSM

    Originally posted by goodswipe: Quote:speaking of RS,whats a good RS like store that all has them bit and bobs? the one here closed down due to the plague known as wallmart and I need to get some odds and ends no one else carries here.. I dont want to pay shipping ontop of RS prices at thier website. Hmm, maybe try Monoprice?dosent have leds,stero jacks and other bits dose has audio and data cabling tho and at a good price.

    For all the console/game fanboys out their.
    http://www.escapistmagazine.com/articles...Console-Rundown
    Oh god I can't stop laughing!!!
    ---
    And for the format nazi's I bring you HHD DVVD BVD's!!

    17.4.2008 12:51 #25

  • hermes_vb

    Are you ready for Circuit Buster? LOL

    19.4.2008 13:46 #26

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