Steve Jobs will take the big blue and yellow signs along with the customer lists Blockbuster owns and turn them into an Apple digital video empire, in a scenario contemplated by pundit Robert X. Cringely.
Picture this: it is 2007, and you want to rent a couple of movies to watch on your home theater. You take your new video iPod to the car and drive over to Blockbuster.
Most of the rows of videotapes and DVDs have vanished, though some containing best-sellers and popular classics remain. A number of kiosks have been installed where the video iPod can be plugged in to download time-expiring copies of movies.
A screen lights up when the iPod is connected to an iMac kiosk, and you decide that your wife would enjoy nothing more than a classic double feature of “Reservoir Dogs” and the Hong Kong movie that inspired Quentin Tarantino, “City on Fire.”
After downloading your ticket to divorce movie selections and paying for them electronically, you wander the aisles looking at some of the new Apple hardware available for purchase before deciding to pick up some popcorn and sodas on the way out the door. At home, you play the movies in your home theater from the video iPod, and enjoy your snacks alone after your wife decides to go visit her mother.
Cringely speculated in his latest column how Apple could make this scenario possible should it partner with Blockbuster. His argument hinges on tens of millions of people who do not have broadband access or an iPod. Those people represent a new market for both digital movies and for iPods or other Apple hardware.
That scenario would complement whatever online distribution strategies Jobs can hammer out with his new movie studio industry partners, considering his recent sale of Pixar to the Walt Disney Company. Disney is a major player in Hollywood, and Jobs now has a really big chunk of the House of Mouse in his stock portfolio.
Cringely suggested a new video iPod with video and audio out jacks could be the hardware key to such a proposition as he’s made:
This iPod — which will be just as good at playing songs as any iPod that preceded it – will be more than just a video storage device. It will be a video player. No make that plural – players – a whole family of video-out iPods, some with flash storage and others with little disk drives.
Would Blockbuster consider such a deal, even when exposed to what Cringely called “Steve Jobs’ reality distortion field?” Cringely guessed Blockbuster would need a lot of Apple hardware installed in its local stores to make this happen. Carl Icahn may not be thrilled at the prospect of Blockbuster buying up thousands of xSans, xServes, and iMacs from Apple to enable this initiative.
Ultimately, the proposition would provide Apple with a new market for its hardware, and firmer dominance of digital entertainment. Blockbuster would get a chance at profitability by being able to offer not just hundreds of movies in one store, but thousands instead, all through digital downloading.
The big question for Blockbuster: could it make enough money in this scenario to offset the loss of late fees it earns when people do not return their movies on time?
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David Utter is a staff writer for Murdok covering technology and business.
