Ok, this will probably be the one and only time I ever post in this particular section, but truth to be told, I've learned a lot more about investing by reading other peoples' posts than I ever would have expected. You guys would be surprised at how many SPs read this section without ever posting a reply! I've bounced this idea off a few people with experience (and received mostly positive feedback) I thought I'd throw it out here for and see what TERBland has to say.
I'm a very small-time investor, mostly just using my TFSA account to keep ahead of inflation, and with interest rates at an all-time low, savings accounts and GICs are basically worthless to me... but I don't have the time or the expertise to play the higher-risk stocks. Mostly I've concentrated on the big five bank stocks, preferring dividends to growth, but I've been thinking about taking a flyer on Blockbuster (BLOAQ.PK), which is sitting around 35 cents/share as of this afternoon.
It seems that Blockbuster has mostly abandoned their traditional business model, and is now concentrating on online distribution instead of DVDs and Blu-Ray discs. They've been promoting their new model pretty heavily, and it seems that Netflix is their only real competition. Netflix has also adjusted their business model in recent years, abandoning snail-mail DVD distribution in favour of online streaming.
But the biggest knock against Netflix has been their limited content, which I suspect is mostly due to an inability to solidify distribution agreements with the major movie studios. Blockbuster, on the other hand, has been working with the major studios for decades, and might be much better positioned to bring big-movie distribution to the online market, due to their connections with those same studios.
Reasons why Blockbuster might be a good pickup:
- History of distribution agreements with major studios
- Brand recognition and a good reputation with the consumer
- Their stock price is quite low right now
- With online distribution, there's no need for carrying a large inventory of stock, nor would they need to rent prime real estate for their stores or carry large numbers of employees (minimal overhead)
- Advances in technology that would improve picture quality and streaming speeds
Reasons against:
- Recently emerged from bankruptcy
- Uncertainty amongst internet providers regarding internet shaping, and an unwillingness to allow unlimited bandwidth
- Limited competition among IPs, and a desire to control the content available to their customers
- Probably a bunch of other things that I'm unaware of or haven't considered (which is why I'm asking for advice from those with more experience!)
Anyways, I'll probably be doing something about this within the next week or so, and I'm curious to hear other peoples' thoughts on this. If you'd prefer not to reply publicly, you can email or PM me instead. Thanks in advance for your advice!
I'm a very small-time investor, mostly just using my TFSA account to keep ahead of inflation, and with interest rates at an all-time low, savings accounts and GICs are basically worthless to me... but I don't have the time or the expertise to play the higher-risk stocks. Mostly I've concentrated on the big five bank stocks, preferring dividends to growth, but I've been thinking about taking a flyer on Blockbuster (BLOAQ.PK), which is sitting around 35 cents/share as of this afternoon.
It seems that Blockbuster has mostly abandoned their traditional business model, and is now concentrating on online distribution instead of DVDs and Blu-Ray discs. They've been promoting their new model pretty heavily, and it seems that Netflix is their only real competition. Netflix has also adjusted their business model in recent years, abandoning snail-mail DVD distribution in favour of online streaming.
But the biggest knock against Netflix has been their limited content, which I suspect is mostly due to an inability to solidify distribution agreements with the major movie studios. Blockbuster, on the other hand, has been working with the major studios for decades, and might be much better positioned to bring big-movie distribution to the online market, due to their connections with those same studios.
Reasons why Blockbuster might be a good pickup:
- History of distribution agreements with major studios
- Brand recognition and a good reputation with the consumer
- Their stock price is quite low right now
- With online distribution, there's no need for carrying a large inventory of stock, nor would they need to rent prime real estate for their stores or carry large numbers of employees (minimal overhead)
- Advances in technology that would improve picture quality and streaming speeds
Reasons against:
- Recently emerged from bankruptcy
- Uncertainty amongst internet providers regarding internet shaping, and an unwillingness to allow unlimited bandwidth
- Limited competition among IPs, and a desire to control the content available to their customers
- Probably a bunch of other things that I'm unaware of or haven't considered (which is why I'm asking for advice from those with more experience!)
Anyways, I'll probably be doing something about this within the next week or so, and I'm curious to hear other peoples' thoughts on this. If you'd prefer not to reply publicly, you can email or PM me instead. Thanks in advance for your advice!
