Families cutting recreational spending
It appears when money troubles pop up, the first thing to go is spending on entertainment. Ticketmaster, Barnes & Noble and Blockbuster all had low sales and low or no profit in the fourth quarter.
Blockbuster
Blockbuster did not have low profits. It had no profits. In fact, the United States’ biggest movie rental chain lost $360 million. The video rental business has been hit hard by Netflix and more movies being offered online.
Businesses such as Netflix, which delivers DVDs to be borrowed by mail, are doing very well. So people have not stopped watching movies, they have found a more convenient way to do so. Blockbuster is applying for short term loans to keep the business afloat.
Business dealings
Blockbuster has gotten tentative agreements from JP Morgan Chase and a couple of other lenders, but even the company head is concerned that Blockbuster might not be a viable business much longer. The sign that Blockbuster is truly in serious trouble: it needs the loans to pay off debt.
Barnes & Noble
Spending on non-essentials such as books and CDs has gone way down. The internet hasn’t helped the CD sales department, either. Free online radio stations and programs like iTunes that let you download music have all but made CDs obsolete. It’s only a matter of time.
Barnes & Noble did make money fourth quarter, but its earnings fell 29 percent. ... click here to read the rest of the article titled "Tough Times in the Enertainment Business"
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