Market Insight

Danish TDC acquires Blockbuster brand for digital streaming service

January 31, 2014


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Danish telecommunications company TDC Group has acquired the digital rights to the Blockbuster brand name in Denmark from owner Dish Networks. In the first half of 2014, TDC will rebrand the online movie rental section of its YouBio online movie service to Blockbuster.

This move is separate to the recent sale of the Danish subsidiary of Blockbuster to a group of Danish investors, and the ongoing rebranding of former Blockbuster stores to RecycleIT: TDC has not acquired any Blockbuster stores and the current deal is only for the right to use the Blockbuster brand name digitally.

Commentary

In the US, Dish Networks operates a Blockbuster branded TV-based VOD service and an OTT on-demand service. But internationally, industry observers have speculated that Dish Networks retained the international digital rights to the Blockbuster brand name, to permit an open ended approach to the international expansion of its currently US-exclusive services.

The sale of Blockbuster Denmark came about partly because local management was unable to secure funding from its US parent company for digital expansion. Gordon Brothers (the last owners of Blockbuster UK) also partly blamed the closure of the UK-based chain on its failure to reach an agreement with Dish Networks regarding the use of Blockbuster as an online brand. That Dish Networks has now opted to license out the Blockbuster brand for digital use internationally comes as a surprise and thus suggests a change in strategy

The Danish digital video market is already crowded with strong brands in the online space, and TDC will compete with local incumbent SF Anytime, in addition to, well-regarded international players iTunes and Netflix. For TDC, which already offers OTT SVOD services and digital movie rental via its YouBio brand (as well as a range of cable and IPTV services), it is not clear how the Blockbuster brand will add consumer value to its offering.

TDC’s digital movie rental service YouBio (soon to be re-branded as Blockbuster) offers new releases in the pre-SVOD window at prices comparable with traditional in-store physical disc rental charges.

Physical rental is in decline across Europe however the drivers behind the changes in consumption has so far been driven more by the closure of video rental stores than consumers opting to switch platforms from physical to digital. In Denmark, the former Blockbuster chain which is currently being rebranded as RecycleIT continues to offer traditional video rental, and with 45 stores across the country the chain still represents the largest video specialist rentailer in Denmark.

Organization
Blockbuster TDC
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