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Blockbuster tries to compete with Netflix -- again

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Blockbuster Inc's (NYSE:BBI) attempt to compete with online-only DVD renter Netflix Inc. (NASDAQ:NFLX) has taken yet another turn. The once popular video merchant will now let its "Total Access" subscribers return a DVD rented online to a Blockbuster store.

While this specific program is not earth shattering, it will give online DVD renters who are Blockbuster subscribers a little more flexibility on how they return videos. While I am not so sure that anything can beat Netflix's "drop in any mailbox" feature, the online Blockbuster system immediately gears up the next movie in the subscriber's queue for shipment once a video rented online is returned to a store.

Thus the time it takes a Blockbuster subscriber to receive fresh DVDs in the mail is reduced. Netflix subscribers have to wait until videos are returned by mail to have new selections in their queues sent to them, which introduces more lag and wait time. Will Blockbuster's attempt at cutting the wait time compared to competition from Netflix actually help its DVD rental business? Nobody knows, but previous attempts at taking on Netflix have fallen flat. Even Wal-Mart Stores, Inc. (NYSE:WMT) got out of the online DVD rental business, as it was unable to beat Netflix at its own game.

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Last updated: November 25, 2009: 11:26 AM

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