Brief epilogue to last week’s story CHS reported about the sudden closure of Hollywood Video on Broadway. We never heard back from the half dozen executives we tried to reach by phone to talk about the decision to shut down the Capitol Hill outlet of the Movie Gallery, Inc.-owned chain. But we did find a report from the financial markets explaining Movie Gallery’s hard times:
Movie Gallery Inc., owner of the Hollywood Video chain, is renegotiating leases and past-due rent and may close 200 more stores as customers defect to mail-order and kiosk retailers.
The Wilsonville, Oregon-based operator of Movie Gallery and Hollywood Video has shuttered 250 stores since Sept. 1, cutting the number of outlets to 2,921, according to Chief Marketing Officer Clifford Torng. Another 150 to 200 may close by year- end, he said.
The second-largest North American video-rental chain after Blockbuster Inc., Movie Gallery failed to adapt to a changing market after leaving bankruptcy last year. Netflix Inc., which rents movies by mail, and Coinstar Inc., operator of Redbox kiosks, have taken customers from traditional stores, deepening the impact of an industrywide drop in DVD sales this year.
The Bloomberg report goes on to document Movie Gallery’s struggle to pay rent for its thousands of stores noting that the company went so far as to set up a toll-free number for landlords to inquire about late payments.
Still no word on what the owners of the 1929 Anhalt-designed building will do with the empty space. We’ll let you know when we find something out.
Fascinating. Thanks for the updates and the news about Taco Time. Hollywood has a great selection, but Blockbuster and Redbox have been beating them on price and late fees. Frankly, Hollywood has too many outlets as it is, but it was certainly convenient for the Hill and had great late hours. At least the indies with there better selections will get more business now.