Blockbuster has been in movie rental industry for years and what threatened its existence is simple mail-in movie idea with prepaid envelope and no late fees of Netflix. Blockbuster loosing its share to Netflix started its own online rental in 2004 and introducing no late fees at its physical stores.
Blockbuster in attempt to gain back its lost customers to Netflix started aggressive promotions during last year’s holiday season by introducing
1) “From Dec. 5 through Dec. 21 of year 2006 Netflix members can exchange the tear-off address flaps of their Netflix rental envelopes and receive on-the-spot free movie rentals from Blockbuster for every flap they bring in to any of the more than 5,000 participating Blockbuster stores” and
2) Blockbuster introduced new model which I felt more meaningful and left without a movie plan is “the new program that gives online movie renters the option of returning their DVDs in the mail or exchanging them at a participating Blockbuster store for free in-store movie rentals”.
Does this creativity to attract existing (or new) customers ended here? No, Netflix started a new one recently.Netflix subscribers can now watch movies instantly on PC.It is new way to access to Netflix instant movie watching feature for its subscribers. Not all movies are available online at this time which looks like is the plan of Netflix to add all of them to online viewing by its netflix subscribers eventually.So Netflix advanced one step in this fight by making the movie watchers more lazier that avoids them a trip to a rental store like Blockbuster.
Find CNET review of side by side comparison of two plans.