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  #1  
Unread February 21st, 2013, 09:10 PM
SpiceCake SpiceCake is offline
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BB posts $24 million operating loss; Ergen still determined to make it work

Here's a recently-released bit of news. During Dish's fourth-quarter fiscal call, Ergen made a number of interesting comments regarding BB, including that he hoped to be able to "tread water" long enough to make the BB stores useful for selling wireless services/devices. He also stated that the stores they have are too big for just renting movies/games, although he also said that they had enough sales volume to support that (I.e., if worst comes to worst, we'll just keep the stores open to rent shit to people).

If I ever become extremely rich and need to hire an all-purpose consultant to help me be successful with the most retarded and irrelevant project ever, I will absolutely hire Ergen to helm the project, because he is obviously hell-bent and determined to make BB work. Here's the article:

http://www.homemediamagazine.com/blo...st-video-29678

"Dish Network chairman says existing 500 Blockbuster locations represent premium retail opportunities for ancillary products

Blockbuster LLC continues to operate under the microscope of parent Dish Network, with the satellite TV operator determined to extract incremental revenue from the iconic brand while mindful of the bottom line, said Dish chairman Charlie Ergen.

Fielding media questions for the first time on Dish’s Feb. 20 fourth-quarter fiscal call, Ergen reiterated previous comments about utilizing Blockbuster stores to launch wireless products. With regulatory delays and other issues hindering rollout of proprietary wireless spectrum, launching products such as mobile phones hasn’t materialized.

Dish, which acquired Blockbuster out of bankruptcy in April 2011, currently markets satellite TV subscriptions in Blockbuster stores.

“The stores are just too big for video only product, although the ones we have left have enough volume to support that,” Ergen said. “We’ll just continue to evaluate Blockbuster. But we’re also evaluating where we are in other businesses.”

Blockbuster last month said it would shutter 300 stores in the coming weeks leaving the chain with 500 stores operating nationwide. Ergen said the remaining locations offer “pretty premium” retail opportunities with attractive lease rates.

“There’s a real asset there as long as we can tread water long enough to use them for wireless or other products,” he said without elaborating what those products might be. “Or if not, we re-evaluate and say ‘if we’re actually going to lose money, it doesn’t make any sense to hold it,’ and we’ll shut it down.”

CFO Robert Olson said the existing Blockbuster stores have met their operational threshold, while non-strategic asset Blockbuster U.K. was put up for bankruptcy in order to monetize its assets.

“It’s something we look at every month,” Olson said.

Meanwhile, Blockbuster reported a fourth-quarter (ended Dec. 31) operating loss of more than $24 million, which included a $21 million charge from the Blockbuster U.K. operations.

For the year, Blockbuster posted an operating loss of $35.3 million on revenue of $1.08 billion compared to net income of $1.1 million on revenue of $975 million in 2011.

Blockbuster ended 2012 operating 800 stores compared to 1,500 stores in 2011."
  #2  
Unread February 21st, 2013, 09:25 PM
KAWLIGA KAWLIGA is offline
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  #3  
Unread February 21st, 2013, 10:20 PM
SpiceCake SpiceCake is offline
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This is what I don't get -- BB posted a 24 million dollar loss, correct? Of course, I know that the BB "diehards" will say, "But look, it says in the article that 21 million dollars of that loss is due to BB UK!" And that is true... however:

If you subtract the $21 million loss that is attributed to BB UK from the $24 million dollar overall loss, it means that BB's American branch still lost $4 million.

Yes, that's right: despite liquidating hundreds of stores, they STILL posted a $4 million loss! Somebody PLEASE explain it to me... and I know I ask this every week, but that's because I can never seem to wrap my head around it: WHAT is Dish thinking?!

Even if they're able to make the 500 remaining stores remotely profitable by utilizing them to sell wireless services, they'd still have to open up AT LEAST 2000 more locations to compete with Verizon, et al. Do the math -- if Verizon has ~2500 stores and BB has 500, that means that BB has only 20% of the number of stores that Verizon has. In other words, Dish would have to increase BB's store numbers by at least 80% in order to compete with Verizon.

It doesn't make me mad -- it just doesn't make sense.... gaaaaaaaaaaaaaah!
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  #4  
Unread February 22nd, 2013, 03:58 PM
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BBVTyrant BBVTyrant is offline
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This is what happens when you have powerful people that just can't seem to admit they made a mistake. And I guess doing that would make you look like an inept buffoon to the board at DISH. It's politics at play here and Ergen trying to keep his job by not being fully honest that he made a horrendous decision.
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  #5  
Unread February 23rd, 2013, 05:44 AM
orbitdvd orbitdvd is offline
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Running Blockbuster must make your brain rot.
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Unread February 23rd, 2013, 05:33 PM
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Originally Posted by orbitdvd View Post
Running Blockbuster must make your brain rot.
And going back to work for the company again means that my brain has rotted.
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  #7  
Unread February 27th, 2013, 01:09 AM
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inkedangel inkedangel is offline
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My husband and I really wish we could afford to open our own store. Just have no clue where to even begin let alone how to apply for all the stuff that's out there to help people start small businesses. With the stores in our area closing last year, there isn't much out here and the mom/pop places are hitting it hard.
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