We still don't know DISH Network's (Nasdaq: DISH) actual plans for Blockbuster after its winning bid, but it doesn't plan to shutter all of the remaining 1,700-ish stores right away.
The satellite television provider is assuming the leases of roughly 500 stores, according to a bankruptcy court filing.
What about the other 1,200 locations? The obvious answer is that they're toast. If DISH isn't assuming those leases, it will likely hand them over to liquidators to begin getting back some of its money.
Shuttering more than two-thirds of its stores would seem to go against the notion that DISH was going to use the stores as a platform to move more DISH subscriptions. It may very well set up camp in the liquidating stores during the "going out of business" sales, reaching out to couch potatoes eyeing new entertainment options.
The biggest winner here would be Coinstar's (Nasdaq: CSTR) Redbox. As your nearest DVD rental store grows farther and farther away, the Redbox kiosks look better and better.
Netflix (Nasdaq: NFLX) is also positioned well to take on store-less celluloid junkies, as more consumers retreat into their homesteads with mail-delivered DVDs and a growing library of streaming video.
Who else benefits? Blockbuster's marketing has always emphasized new releases, something that consumers can't always rent from Redbox and Netflix with their 28-day release delays. A lot of companies will cash in there, from the studios that are likely to sell more DVD copies to the video-on-demand offerings of cable and satellite television providers.
The lack of new title availability through Redbox, Netflix, and a cobwebbed Blockbuster may also be the catalyst that Apple (Nasdaq: AAPL), Wal-Mart's (NYSE: WMT) Vudu, and Amazon.com (Nasdaq: AMZN) have been waiting for. Premium video on a piecemeal basis hasn't been as big a hit digitally as it was during its bricks-and-mortar prime. As real-world options dry up, it's time for the digital understudy to shine on stage.
It's unlikely that the decimation of Blockbuster will lead to lower video consumption. That technophobe uncle of yours who reluctantly bought a Blu-ray player but failed to hook it up to the Internet will come along.
Outside of Blockbuster employees, suburban strip-mall landlords, and some chump with an ill-advised "Blockbuster 4-Ever" tattoo, there will be more winners than losers.
When's the last time that you stepped into a Blockbuster store? Share your thoughts in the comment box at the bottom of this queue.
