Over the weekend, I received a mailing happily stating that the end of late fees is the biggest announcement in Blockbuster history. TV spots show giddy consumers celebrating the end of late fees. Good for consumers, sure. But with heavy competition from VOD/Netflix/Walmart et al, bad for Blockbuster.
In test markets, the company claims that the loss of revenues has been offset by the generation of additional rentals. At the same time, however, it projects that this year's operating income will be reduced by $250 million to $300 million, meaning zero growth over 2004.