Icahn, who failed with his Blockbuster investment some years ago, is taking another stab at the videorentalbusiness, albeit one with a slightly modernized business plan.
While Netflix (NFLX) gets most of the headlines, one of the most remarkable developments in the videorentalbusiness over the last few years has been the amazing growth of Redbox , the videorental kiosk business run by Coinstar (CSTR), a company that used to be known for its coin-counting machines.
The business model differs from that of traditional videorental stores that typically let customers pick movies from an available physical library of titles.
Our rationale for trying to buy Hollywood Video was for Blockbuster to orchestrate an orderly downsizing of the store based rentalbusiness while we developed our online business.