Blockbuster strikes on-demand deal with TiVo

Blockbuster is striking a deal to sell and rent films through TiVo’s DVRs in a bid to defeat online rivals in the movie rental space.

Blockbuster On Demand will offer access to 10,000 titles from Blockbuster’s library for purchase or rent to TiVo customers who own the latest TiVo boxes and have high-speed internet access. Subscribers will be able to rent titles for between USD1.99 and USD3.99. It will cost between USD14.99 and USD19.99 to buy films and TV shows.

Blockbuster will stock TiVo boxes in its stores and on its website. The service is scheduled for launch in the second half of 2009.

Blockbuster is attempting to diversify its rental business in response to stiff competition from online rivals such as Netflix. Both Netflix and Amazon have existing deals with TiVo, but Blockbuster claims its range of films and TV shows will include more new releases.

Blockbuster is also expanding into other digital areas. The company recently signed a deal with Sonic Solutions to offer movies for rent and to buy on broadband-connected digital devices. Despite operating 7,500 stores worldwide, Blockbuster does not see the digital expansion as a threat to its brick-and-mortar-based business.

?The challenge of being a multi-channel retailer is you no longer can think only about the impact on the other leg. You have to think about what the consumer wants," says Blockbuster SVP of digital entertainment, Kevin Lewis. "We are the only company in the works that can deliver via stores, digital downloads, kiosks ... across all these channels."

?You will see us in a large number of other devices going forward,? he adds. TiVo pioneered DVRs, but is struggling with new competition. Though it is adding to its subscriber base through a deal with ISP and cable TV-provider ComCast, the firm only just managed to turn a profit last year. The company hopes deals such as the one with Blockbuster will help it reassert itself in the market.