mr keyes obviously is a big fan of the quantitative approach
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New Boss Aims to Apply Some 7-Eleven Tactics to Blockbuster
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By ANDREW ADAM NEWMAN
Published: July 17, 2007
If Blockbuster is a company in desperate need of a script doctor, the man it has chosen for the task — James W. Keyes, the former chief executive of 7-Eleven — could perhaps be described as a master of rewrite.
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Brian Harkin for The New York Times
James W. Keyes of Blockbuster must meet competition from Netflix, video-on-demand services and TiVo.
At 7-Eleven, he built smaller stores at a time when other chains were building bigger ones. While competitors were still letting distributors choose which beer…show more content… A bright spot for Blockbuster has been its Total Access program, which lets customers rent movies through the Web just the way they can at Netflix. That program gained 800,000 subscribers in the first quarter, bringing the total to about 3 million, Blockbuster said.
Mr. Keyes said that while the company wanted to continue to gain online subscribers, the physical stores “represent a great competitive advantage” over Netflix.
“We’re at one of those pivotal points where the consumer is beginning to demand content in different ways,” Mr. Keyes said. “It’s important to make the transition to the next wave of demand, whether that’s digital download to PCs, or downloads to personal video devices, iPhones and new BlackBerrys with video capability.”
Since it began in the late 1990s, Netflix has reshaped the movie rental business; it has 6.8 million subscribers, according to first-quarter results, and earned $9.9 million, compared with $4.4 million in the period last year.
Hollywood Video, which is owned by Movie Gallery, chose to ignore the Internet rental business, a choice that may prove fatal: this month it announced that it had defaulted on $750 million of debt and was planning to close many stores and put itself up for sale.
Blockbuster, on the other hand, began offering DVD rental through the Internet in 2004. Total Access gives subscribers the option of returning DVDs through the mail or to a store.
Netflix sued for patent infringement last year, saying