So much for a soft landing. Blockbuster (NYSE:BBI), the DVD rental giant, met with Wall Street analysts last week in what Reuters seems to describe as a move to temper enthusiasm over the popularity of its Total Access program.

Blockbuster has recently said that it would scale back its ad spending on its Total Access program, which couples Netflix-esque rentals by mail with free in-store exchanges. Over the summer, it also hiked the price new subscribers will pay for its premium plan, which includes unlimited in-store exchanges, from $17.99 a month to $24.99 a month. According to the article, while Blockbuster's churn rate has held constant, these moves have resulted in far fewer new subscribers.

Reading between the lines, some analysts feel that Blockbuster closed out the third quarter with less than the 3.6 million Total Access subscribers it watched over three months ago.

Negative growth hit rival Netflix (NASDAQ:NFLX) a quarter earlier, as the pioneer went from 6.8 million members to just 6.7 million during the months of April, May, and June.

Will Blockbuster's loss be Netflix's gain? That could be a dangerous assumption, especially if it's a grim sign that the market is peaking. It seems unlikely, I know. Adams Media Research and internal Netflix estimates peg this as a market with more than 20 million subscribers in four to six years. Blockbuster and Netflix combine for just 10.4 million members at the moment.

However, how confident will the market be in the industry's growth if both Netflix and Blockbuster post negative growth in the recently concluded third quarter? It can happen. Three months ago, Netflix targeted 6.7 million to 6.9 million subscribers by the end of the third quarter. The company hasn't updated its guidance, despite what appears to be weakness at Blockbuster. If Netflix clocks in at the low end, flat, or potentially softer than the 6.74 million, the industry may suffer its first sequential dip in member headcount.

Anecdotal evidence argues otherwise. Companies like (NASDAQ:AMZN) and Apple (NASDAQ:AAPL) have been promoting the digital delivery of celluloid for several quarters, and the moves haven't been cannibalistic to mail-delivered services. In-store flick rentals have been soft at chains like Blockbuster, Movie Gallery (NASDAQ:MOVI), and Hastings (NASDAQ:HAST), usually at the expense of growth at Netflix and Blockbuster's Total Access.

Still, what if the waning appetite for theatrical releases at the retail market level indicates a trend away from consuming any DVD rentals? Are next-generation video games, free video-sharing websites, and sticky social networks filling the entertainment void? We're a few weeks away from what may be a one-two punch when both companies post their 3Q financials. It's OK to hope for the best, but brace yourself for the worst, just in case.   

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