Revenue sharing all over again?
January 18, 2008

To get further into the download business, or manufacturing on demand, or any new technology, Blockbuster CEO Jim Keyes needs money to invest, and he sees the company's core in-store DVD rental business as the best source of that cash.
Keyes discussed this recently in a a presentation to analysts at the Citigroup 2008 Global Entertainment, Media and Telecommunications Conference. 
The stores have the potential to increase the company's cash flow, Keyes said, with improved merchandising ranging from better design to greater depth of copy. And to achieve depth of copy, he suggests, Blockbuster needs to create "a different economic structure with the studios" so that it can put more copies on shelves without shouldering all the financial risk alone (and preserving cash).
Can anyone say "revenue sharing"?
I said a while back, when Keyes talked about increasing products for sales in the stores, that he sounded a lot like Bill Fields. Revenue sharing, however, was all John Antioco when he joined Blockbuster--what?--a decade ago.
Doesn't mean it's not a good idea.
Maybe now that the studios are cutting rental deals with Apple they'll revisit the issue with Big Blue.

Posted by Marcy Magiera on January 18, 2008 | Comments (0)