page_title: Blockbuster LLC
section_title: 2011–2015: Michael Kelly era
hierarchical_section_title: Blockbuster LLC / History / 2011–2015: Michael Kelly era
caption_attribution_description: English: Blockbuster store closing, 2547 Ellsworth Road, Ypsilanti Township, Michigan. Camera location42°&#160;13′&#160;48.7″&#160;N, 83°&#160;39′&#160;01.59″&#160;W&#160;View this and other nearby images on: OpenStreetMap - Google Earth
context_page_description: Blockbuster, officially Blockbuster LLC and also known as Blockbuster Video, was an American-based provider of home movie and video game rental services. Services were offered primarily at video rental shops, but later alternatives included DVD-by-mail, streaming, video on demand, and cinema theater. Previously operated by Blockbuster Entertainment, Inc., the company expanded internationally throughout the 1990s. At its peak in 2004, Blockbuster consisted of 9,094 stores and employed approximately 84,300 people worldwide – 58,500 in the United States and 25,800 in other countries.
  Poor leadership and competition from Netflix's mail-order service, Redbox automated kiosks, and video on demand services were major factors leading up to Blockbuster's eventual demise. The company began to lose significant revenue during the late 2000s, and the company filed for bankruptcy protection in 2010. The following year, its remaining 1,700 stores were bought by satellite television provider Dish Network. By early 2014, the last 300 company-owned stores were closed.
context_section_description: At the time of its Chapter 11 filing, Blockbuster said it would keep its 3,300 stores open; however, that December it announced it would close an additional 182 stores by the end of April 2011 in attempts to emerge from bankruptcy. It was reported in February 2011 that Blockbuster and its creditors had not come up with a Chapter 11 exit plan and that the company would be sold for $300 million or more, along with taking over debts and leases. Blockbuster admitted that it might not be able to meet financial obligations required under its Chapter 11 filing, a circumstance which could mandate conversion of the bankruptcy filing to Chapter 7 (liquidation). On March 1, 2011, the U.S. Department of Justice filed a claim disclosing that Blockbuster did not have the funds to continue reorganizing and should liquidate.
  On March 28, 2011, South Korean telecommunications company SK Telecom made a surprise bid to buy Blockbuster.Dish Network had also expressed interest in bidding, as did Carl Icahn, despite calling Blockbuster "the worst investment I ever made". Dish eventually won the auction on April 6, 2011, agreeing to buy Blockbuster for $320 million and the assumption of $87 million in liabilities and other obligations. On April 19, 2011, it was announced that Dish would keep only 500 Blockbuster stores open. The acquisition was completed on April 26, 2011. In April 2011, Dish Network told the U.S. Bankruptcy Court that it needed more time to negotiate with landlords in an effort to keep more than 600 Blockbuster stores open.
  In April 2011, Blockbuster's landlords objected to its assumption of leases that it sought to assign to soon-to-be-owner Dish Network Corp., claiming that they did not have adequate assurance that the new owner would honor those leases. Blockbuster signed a deal with ITV Studios Global Entertainment to launch ITV Programmes released on DVDs, Blu-rays, etc.
  On May 6, 2011, Keyes resigned as Blockbuster's CEO, being replaced by Michael Kelly under the new title of president. On August 31, 2011, the liquidators announced the closure of the remaining 253 Canadian stores and shutting of the entire Canadian unit.
  In September 2011, it was announced that Blockbuster and Dish Network would launch a new service called Blockbuster Movie Pass that would compete with Netflix. For US$10 per month the members would have access to both a streaming service and movies and games-by-mail. The package was only available for subscribers of Dish Network's pay-TV service, and it eventually folded.
  On January 13, 2012, Dish CEO Joe Clayton announced that while Dish had planned to keep 90% of the stores in operation, meaning around 15,000 employees would remain employed, because of market factors "there are ones that aren't going to make it. We will close unprofitable stores. We will close additional stores." Clayton did not say when these additional closings would happen and only remarked that some stores were unprofitable. The Dish chief would not say which stores the company was planning to close, but that each potential closing was to be assessed on a "case by case basis".
  On October 4, 2012, Dish Network announced that it was scrapping plans to make Blockbuster into a Netflix competitor. On January 16, 2013, Blockbuster UK entered into administration and Deloitte was appointed to run the business while trying to find a buyer while some of the stores remained open. Between November 6, 2013, and January 12, 2014, all 300 remaining corporate-owned Blockbuster stores in the U.S. were closed and the DVD-by-mail program was shut down. The Blockbuster official website identified 51 franchise locations remaining in operation in the U.S. in 2014.
caption: A Blockbuster store in Ypsilanti, Michigan under the effects of a liquidation sale occurring in late 2013
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