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Technology Stocks : Westell WSTL -- Ignore unavailable to you. Want to Upgrade?

To: P314159d who wrote (17206)	10/25/1999 10:24:00 PM
From: steve s	Read Replies (1) \| Respond to of 21342

Remember when Westell was in Video on Demand field trails years ago,.......I guess they were ahead of their time. Interesting read. infobeat.com 05:38 PM ET 10/21/99 Blockbuster Moves Onto Internet Blockbuster Moves Onto Internet By DAVID KOENIG= AP Business Writer= DALLAS (AP) _ Blockbuster Inc. is preparing itself for the day when customers rent videos over the Internet instead of driving to a store. The Dallas-based company, the world's largest home-video chain, plans to sell movies and other merchandise at a Web site beginning next month, chairman John Antioco said in an interview Thursday. Next spring, customers will be able to reserve movies over the Internet, but they'll still have to pick them up at the store _ unless Blockbuster starts a delivery service, which Antioco said is under consideration. The actual delivery of movies over the Internet ''is probably four or five years out,'' Antioco said. Some analysts believe Blockbuster is moving in the nick of time _ that technology could some day threaten the very existence of video stores. ''We're big believers in video-on-demand. It's going to take at least half the market share away from the bricks-and-mortar stores,'' said Jessica Reif Cohen, an entertainment analyst for Merrill Lynch. ''Blockbuster has no choice but to explore video-on-demand.'' ''Blockbuster has done a nice job of consolidating a declining industry,'' said Tom Wolzien, a media analyst with Sanford C. Bernstein & Co. in New York. ''They're signing up customers, they're opening stores, they're doing everything right. The question is, are they seeing the future right?'' Wolzien predicts that within four to seven years, consumers will have set-top boxes from cable-television operators that can receive signals for the Internet and video. Even if Blockbuster captures some of that video-on-demand business, Wolzien said, it would be less profitable than video stores, which benefit from late fees and the habit of some consumers to rent more tapes than they watch. Antioco said the technology of providing true, unlimited video-on-demand _ as opposed to glorified pay-per-view, in which viewers select from a limited menu of movies and times _ is still far from ready. Issues of technology, bandwidth and copyright issues must be resolved. Antioco said video stores have survived the advent of pay-per-view and will survive video-on-demand. Some analysts agree. ''We think the plain-vanilla video store will be around for quite some time,'' said Frederick Moran, an analyst with Jefferies & Co. Inc. Either way, Blockbuster aims to become the Web site that people remember when they think of movies, Antioco said. In addition to 6,860 stores, he said the chain has the brand name, customer list (65 million people in its data base), distribution and marketing muscle to make an attractive e-company. ''We should be the clear favorite to deliver movies to people over the Internet,'' Antioco said. Analysts say concern about competition from cable operators in new means of renting movies is hurting Blockbuster's stock price. Blockbuster is 82 percent owned by Viacom Inc. With Blockbuster's stock stuck below the $15 per share price of its August initial public offering, Viacom has delayed plans to complete the spinoff of Blockbuster this year. Viacom chairman Sumner Redstone said Thursday he still wants to sell Viacom's interest in Blockbuster but won't do it cheaply. ''At today's trading range, the final splitoff doesn't make sense,'' Antioco said. He said the company is undervalued by investors, and when its stock price rises, the spinoff will be completed. Earlier this week, Blockbuster posted a net loss of $19.1 million, or 12 cents a share, but its cash earnings, or net income before goodwill amortization, were 14 cents a share, a penny better than analysts had expected. Blockbuster shares, which fell $1.06\ Wednesday, fell another 50 cents to $13.06\ Thursday on the New York Stock Exchange.