Blockbuster Has Net Sales of Around $1 Billion, which was a drop of 19%. The company can brag that it had a positive free cash flow of $109 million. They lost 19 cents per share which was worse than what was expected.

So how can a company that generates $1 Billion in a quarter only have a free cash flow of $109 million and lose 19 cents per share.

In 2007 Redbox opened its 6,000 kiosk which exceeded the number of locations of Blockbuster. Mind you, the available DVD's for rent were more limited but they constituted the new releases and a market driver and with low rental cost. Kiosk cost a lot less than a full rental store to operate.

Blockbuster does realize Redbox is a problem. Blockbuster is planning massive store closures and a major expansion of its own Kiosk business. They plan to have 2500 kiosk by the end of the year. Any change any business always has cost and pitfalls of its own whether it works out in the end or not. Beyond the economic recession and the problems that presents, Blockbuster is bound to find some bumps in the road as it deals with competition.

While Blockbuster does face competition they built themselves on buying and killing competition in the video market. That is both their advantage and their disadvantage.

From my perspective, they were never really a fun retailer like some of the people in the market were. They were basically the bad guys destroying the good guys. I don't say that to say they were doing anything wrong, but the businesses they destroyed or bought were more fun before the market change.

I loved the old record store Turtles and renting movies there back in the day. It was a fun place because it had that atmosphere that the better run record stores had. Nothing tightass about them. Then Al Levenson saw the writing on the wall for the record business and I think he was already being squeezed out of the concert ticket business so he sold the business to blockbuster. Next to Turtles, Blockbuster was total tightass. I think I only went back in the store maybe two or three times after the Blockbuster take over. My sisters dealt with Blockbuster in different locations where they lived through the years, but to me, Blockbuster was always the bad guys. Again, let me make clear, not saying that to be mean or suggest anything. That was just my perspective.

Turtles was a pretty big chain in Georgia and Florida but they had that ma and pa feel of a small store. Their employees were laid back and cool. To some people that might not make a difference, but to me it does.