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Blockbuster suing rival Netflix in anti-trust claims

23 August 2006 6:59 by Dave "Davedough" Horvath | 51 comments

Blockbuster suing rival Netflix in anti-trust claims A federal judge in San Francisco has given the go ahead for video rental giant, Blockbuster on anti-trust claims against rival company Netflix who sued Blockbuster for alleged patent violation.

Netflix had asked the courts to postpone the anti-trust suit until the patent issues could be resolved. However it was written by U.S. District Judge William Alsup, rejecting the motions by Netflix saying that Blockbuster adequately pled it's claims and he sees no reason why Netflix would be harmed in any way by allowing both claims to happen simultaneously.

Judge Aslup wrote, "As a result of Netflix's purported monopolistic conduct, Blockbuster may be forced out of the market, which would cede to Netflix virtually complete control of the online-DVD market".

Blockbuster spokesman Randy Hargrove stated, "pleased with today's ruling and we remain intent on aggressively pursuing our antitrust counter-claims." While Netflix representative, Steve Swasey gave his own comments in saying the business will, "continue to defend our patents and business methods."

Source:
Reuters


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    Discuss this article!  There are more user comments available, read them here
    rureadie (Newbie) 25 August 2006 18:45 Send private message to this user   
    Yeah,about "big and dumb" as Netflix throttling my movies b/c I returned them so fast.Netflix was ok until they pulled this stunt! Oh yea, the comment I got was that the accounts with lower rentals take priority over the large more active renters.Netflix can kiss my......well you probably know.This problem has Never happened with Blockbuster.I do however like Netflix's web site better,but it will do no good for them because I will NEVER use those mother truckers again! RSVP
    ZippyDSM (AfterDawn Addict) 25 August 2006 21:08 Send private message to this user   
    rureadie
    no one siad Netfix was perfect :P
    handsom (Senior Member) 26 August 2006 1:12 Send private message to this user   
    Okay, the throttling back thing, here's a newsflash on that:

    Both of them do it. It is not a matter of discussion, they both were sued, on independent(unconnected) basis by customers, because it was found they started doing it to 'high usage' customers, what NF qualified as a 'high usage' customer was never known, however, BB classified it as any online user who went through six titles or more. Since you get at least two at a time, that means that you switch three times and they throttle you back.

    Ironically, after being sued, neither company changed this policy, they simply changed their legal fine print terms to accomodate, and some members who had been on at these times received refunds, deals, etc. to compensate them for potential missed rentals.

    It's not just one of them, it's both. They simply have different definitions by which they decide it's time to cut back.

    And as far as the suit goes, it's ridiculous, BB feels threatened, and NF feels threatened. NF thought they could get away with sueing, because they are the biggest online rental co. out there. BB knows that won't win the case, and is simply filing a standard corporate countersuit. It's nothing unusual, to be honest. This sort of thing happens all the time. The thing that I think should be taken away from this, is the fact that both companies are clearly feeling a hit in business income, which is why they think that they're losing business to eachother. After working Blockbuster, I can honestly say that BB isn't taking a bit of business from NF. Not a dime. Maybe their online program, but it's a mess. Many titles are actually checked out FROM the STORES. That was a mess, I worked one of those stores, and it could not have been more disorganized, I was shocked their weren't a ton of problems with mismatched discs.

    Again, I don't know how long EITHER company will last as broadband becomes faster, and more affordable, it seems inevitable that we'll see new online pay-per-view type services with wider, more complete selections of films. Imagine being able to pay a monthly fee for access to an entire library of films new and old whenever you want them, instantly. That's where we're inevitably headed, the question is how soon technology will let us.

    This suit is one of the signs that both companies are finally starting to buckle, and I'm hoping to see BB fall first. Not because they're necessarily any worse than NF... But because after working there a while, you become rather synical towards them and their practices.

    -------------------------------------------------
    Will the PS3 dominate the console market?
    Maybe, if Sony lowers the price and stops lowering the hardware specs.
    For News on this: http://www.megagames.com
    ZippyDSM (AfterDawn Addict) 26 August 2006 2:21 Send private message to this user   
    handsom
    it seems to me if BB changes thier throttel back picy alittle to mabye 5 or 8 times to what you rent ,added games at the same price as DVDs they would simpley squaish NF.

    oh well not change or die thats how the like it ><


    I have a brain...I think......

    Windows Vister
    I dub thee vister untill thee can prove thyself.

    I aint the brightest bulb around but I can feel my way in the dark...

    I fuzzy braind mew =0_o=

    FIGHT THE M.A.F.I.A.A.
    "Music And Film Industry Association of America.."

    "Hollywood the 4kids of comic moives."


    anyone know of a DVD palyer that will auto paly a moive?
    skip or play thru all the stuff it cant skip and jsut auto play the darn moive?
    I have a 80 soemthign grandmother and her sis that want to wath moives and cant figure out the DVD remote...
    moocowgal (Junior Member) 26 August 2006 4:16 Send private message to this user   
    I just cancelled my Blockbuster Onlne account. The straw that broke the camel's back was when they opened a new distribution center and assigned my account to it. Overnight everything in my queue went from available now to various stages of waiting. I had to add to an already adequate queue in order to have something in it that they could send me. The one movie at the top of my list was there for just about a year and except for a short period of time at Christmas always available... except to me. If they don't have it in the distribution center you are assigned to, it doesn't matter what the status of the movie is, you're not going to ever get it.
    I had both Netflix and Blockbuster and as far as I'm concerned, they both throttle. I haven't gotten more than 3 DVDs a week from either one of them in a dog's age.
    One thing positive about Blockbuster though is that they do ship the TV shows that are on 2 sided DVDs that way. Netflix ships "rental versions" in which Disk 1 for instance would be Side A of a disk you got from Blockbuster and Disk 2 would be the B side. Just one more way besides throttling to suck in the bucks.
    DamonDash (Inactive) 26 August 2006 5:22 Send private message to this user   
    Okay first off i work at BB for five years part-time here in Charlotte its BB fault that they didn't put up a fight in 98 when netflix lauched.BB said that online rental would not work because customer want there movies right now not later.BB kept preaching this until 2003 when they seen Netflix had growed as a company they realize they was wrong & dumb. So BB launch there own online service in 2004 QT4 3-moives for 19.95.If i was Netflix i would sue the hell out of BB because it was there idea not BB they shot this down in 98 i know because we had a few in store meeting about netflix and BB was not worry about them.


    Far as later fees the reason BB dont have them anymore because a TX couple filed a lawsuit against them in 2001 over the word later fee which to them mean not resposible.The couple said there was never late on anything in there life so that word was hurtful.Also there movie was not late it was found in the store on the shelf not checked in so this did not help BB in the lawsuit against them.The TX couple won the lawsuit from BB,But BB never told us how much the couple won but from what i heard from my DR manger they got over a Few million.And BB can never use the word Later fee so they call it extending viewing Fee now.

    Far as Netflix the only problem i have with them is you cant contact them directly & If its on the eve of them chargeing your creditcard they will not send your movies that day they will hold them til the next day.

    This message has been edited since posting. Last time this message was edited on 26 August 2006 5:23

    ZippyDSM (AfterDawn Addict) 26 August 2006 5:40 Send private message to this user   
    DamonDash
    its a pain to get your Ccard bill date changed ypu ahve to cansel then resetup your account ><

    I have a brain...I think......

    Windows Vister
    I dub thee vister untill thee can prove thyself.

    I aint the brightest bulb around but I can feel my way in the dark...

    I fuzzy braind mew =0_o=

    FIGHT THE M.A.F.I.A.A.
    "Music And Film Industry Association of America.."

    "Hollywood the 4kids of comic moives."


    anyone know of a DVD palyer that will auto paly a moive?
    skip or play thru all the stuff it cant skip and jsut auto play the darn moive?
    I have a 80 soemthign grandmother and her sis that want to wath moives and cant figure out the DVD remote...
    DamonDash (Inactive) 26 August 2006 6:43 Send private message to this user   
    Yeah i know what your talking about because last month i forgot to leave money on my pre-paid card so that shutdown my account.It was 13 days before i put money on my card then i hit renew and got screw out of half a month service.So from now on my friend told me to cancel and it will keep everything just renew it.

    militantm (Junior Member) 26 August 2006 7:17 Send private message to this user   
    I have both services as well and I gotta say Netflix is the better of the two, period. Their turn around time is as fast as you can possibly get delivering something through the mail. I agree with everyone else here. If Netflix just went away ,which they probably won't blockbuster would go back to late fees. Blockbuster has done nothing but increase their prices over the years, they are the ones guilty of monopolistic conduct, they got to big and passed the price increases on to us, thanks for nothing blockbuster. Before netflix I would do anything to rent video through Hollywood video, 20/20 or the neighbrohood store before going to blockbuster to pay 5 bucks for a two day rental.
    POEE (Newbie) 26 August 2006 10:10 Send private message to this user   
    My experience with Blockbuster is the very reason I jumped at the chance to use Netflix, and I've been with Netflix for over 3 years now with no regrets. BB lost my business when they went nutty with late fees. Back in the day, there were many local video rental stores in my area, and it was always common practice that if you owed a late fee, you had to pay it off before you could rent another movie. That wasn't good enough for BB, who would routinely send postcards threating to take my account to collections if I did not pay that late fee RIGHT NOW (and I'm talking about $2 or $3 here). It seemed they were willing to spend several times the amount I owed them just to make sure I felt properly threatened. I always paid any fees I owed any video store before I rented again, of course, so I never understood why they felt the need to be so much more aggressive than anyone else in this regard. Then they started hiking their rental prices and late fees a little more every few months until it was just stupid to choose BB over the local stores. BB got so big they figured that they really didn't have to play nice, and that we would have no choice but to go to them. They put most of the "mom 'n pop" rental stores out of business across the country in an effort to do just this.

    HOWEVER, I must also say that Netflix was going down the path of raising their rates a bit every few months, since they had little competition. So I was very happy to see BB and others get into the online rental market because that forced Netflix to lower their prices again, and keep them low. So I do not want to see Netflix win their suit and become the only large online DVD rental service, as higher prices would inevitably follow. Robust competition is absolutely necessary.
    tmfloria (Senior Member) 26 August 2006 10:13 Send private message to this user   
    There are ways of getting around Blockbuster and their shipping/throttling issues...

    ZippyDSM (AfterDawn Addict) 26 August 2006 17:50 Send private message to this user   
    DamonDash
    I have paypal they jsut hit PP 1 month exsactly after I signed on,and if theresnot enough money it hits it up now and then to see if moeny is in not to abd sicne PP dosent hammer you with charge,sometimes I can get a extra week out of them *L*
    rocky999 (Junior Member) 26 August 2006 18:44 Send private message to this user   
    I know everyone talks about the throttling and both companies have been sued but I must say that I have been very happy. I have had netflix for over 3 years, 3 at a time, and I have never gotten less than 16 rentals and sometimes get up to 23 in one month. I am a heavy user and for me it works great.
    YOBUZZB (Member) 27 August 2006 20:14 Send private message to this user   
    Netflix is the best! Period!!! When I joined them I thought it was a great deal. Since then they've lowered the price 3 times. Never had problems on an issue with a DVD. They were always prompt. My turnarounds were lightning fast as the mail goes. I would get about 24 movies a month. How do ya beat that without downloading movies online?
    ZippyDSM (AfterDawn Addict) 27 August 2006 20:36 Send private message to this user   
    Netflix is sharp I emailed with a od payment it took 19 out of my Ccard and then fixed it within the same 24 hours.
    Netflix is not perfect but it is nice.
    FJGallag (Newbie) 28 August 2006 12:08 Send private message to this user   
    I agree with Mr. Movies. I had Netflix for years, at their highest fee of $48 for 8 DVD's, and I RARELY got a new release. My average wait for a new movie was 4-6 weeks, with some taking several months. They admitted to me in writing that they give preference for new releases to the econo-crowd that pays $9.95 per month. The older movies they did send me started to take about a week to arrive.

    Now I have Blockbuster at 29.95 per month for 5 DVDs at a time. I get ALMOST EVERY new release I request, and the only negative is that occasionally, one DVD will get lost in the mailing system for a week or more after they mail it to me. But that's rare, apparently not their fault, and far outweighed by the several free in-store rentals they give me every month.

    I would NEVER use Netflix again, even if they were the only online movie provider on the Interenet.
    ZippyDSM (AfterDawn Addict) 28 August 2006 12:17 Send private message to this user   
    FJGallag
    I guess it all depends on what you pick I dont do new releases and am on 8 at a time and get all my moives in less than a week/5days.
    htaylor (Newbie) 30 August 2006 18:36 Send private message to this user   
    I have tried both and blockbuster will send you a replacement as soon as you report a broken or lost dvd but netflix will not send you a replacement until they receive the damaged dvd,also you never get any new releases from netflix ,you only get junk. I have a few days left with netflix and I am dropping them and going to the video store to get my dvd's.Netflix could care less about their customers.
    punani (Newbie) 31 August 2006 13:26 Send private message to this user   
    I received a broken disc in the mail and they sent me out a replacement right away.i find it hard to believe that netflix is going to make you wait for a dvd if they have a copy they will send it you.it doesnt benefit them to wait for the disk if they have for example 5 dvds of say matrix and 4 are rented out they have one left they will send it to you unless all of them are rented out,netflix is a big operation if you thnk they have the resources to monitor dvds or mointor each indivual dvd(which most companys arent that organized enough to even run thier business correctly)then you are giving them more credit than is due thay dont have the resources and thought process to do that imho. I think they just send you what they have, complain if you will but you can beat 4 dvds for 25 bux at a time as many as you can watch in a month its a great deal imho. regardless of who you go with either company offers a good deal but blockbuster has abused its customers for a long time and is only being nice now because of netflix thats why i dont care what they offer to me regardless of how good a deal it is.
    htaylor (Newbie) 5 September 2006 9:08 Send private message to this user   
    nobody have to lie about any dvd service. RV have been at the number one spot in my que and it says available but I get a junk movie sent to me ,this have been going on for a long time,I guess I will never get RV.Also they make you wait days for a movie holding up sending you a replacement.Almost all of the good movies stay on waiting even the ones I select months in advance. I selected X-Men when it first came out in the movies now it have a date when it will be released but I would bet you I wont get it for three or four month after it's released. PLease if anyone know their telephone number please let me knowit, I really want to talk with them.
    moocowgal (Junior Member) 7 September 2006 0:19 Send private message to this user   
    Believe it punani, Blockbuster sends out replacement disks, if you report that you haven't gotten the one they sent, right away. It's one of the few good things I could say about Blockbuster. Netflix makes you wait for several days after the expected arrival date before they will even accept a report of a missing disk. I believe they say that if you haven't received it within 6 days of the expected arrival date to then submit the report.
    As for broken disks, Blockbuster will remove it from your queue as soon as you report it and it will show up again(usually within 24 hours) as soon as they mail out the replacement. With netflix I was told to send the disk back and they would replace it when they got it back.

    This message has been edited since posting. Last time this message was edited on 7 September 2006 0:22

    handsom (Senior Member) 8 September 2006 14:18 Send private message to this user   
    I remember shipping out those discs from our store when I worked there. So many problems.......geez. We sent incorrect discs, cracked discs, damaged discs, you name it. The funniest part is, you could basically tell them anything you wanted to, and they wouldn't be able to track it or tell the difference. They are so disorganized that they have to take your word for it. I don't know how well organized netflix is behind the scenes, but BB is a mess.

    I really don't think BB will see another decade. I say such a long estimate, because a company like that can coast on fumes for a while, with different companies buying them out and dumping them over and over. I do so like to watch though.

    -------------------------------------------------
    Will the PS3 dominate the console market?
    Maybe, if Sony lowers the price and stops lowering the hardware specs.
    For News on this: http://www.megagames.com
    blue330i (Newbie) 19 January 2007 16:11 Send private message to this user   
    I've been a customer of Netflix for over 2 years, and when I saw Blockbuster's advertisement about the added plus of in-store rentals, I have to admit I was tempted to switch over. However, since blockbuster often doesn't stock certain movies (such as NC-17 and some "unrated" movies, something I didn't find out until recently), I decided to stick with Netflix. Even though it is their right to decide which movies they carry, I hate censorship.
    ZippyDSM (AfterDawn Addict) 19 January 2007 23:33 Send private message to this user   
    Netflix has the plan price and selection I like BB not so much now if they can combine their movie and game selections into there plans IE 3 DVD or games mixed anyway you want for 20 a month with tax or even 23 a month with tax I would jump ship. probably be pissed at their movie selection tho...netflix needs to buy out gamefly and rule net renting forever more!
    moocowgal (Junior Member) 20 January 2007 15:32 Send private message to this user   
    I dumped my Blockbuster online membership months ago and I can't say I'm sorry I did. I was slightly tempted when they changed to their new policy of being able to return the movies to the store and pick something else right away but then I used my brain. The reason I subscribed to the online service in the first place was because the storefronts didn't have the movies I was looking for. If they didn't have them then they sure aren't going to have them now, and then there's the matter of not being able to get the movies you want through the online service if they're not available in your local distribution center. When I cancelled I had a movie sitting at the top of my queue for a year and for most of the time it showed an "available now" status. Problem was that it wasn't available to ME. No telling where the copy or copies were located but one thing is for sure, they weren't going to ship one from where they were to where I am.
    I'm as happy as a clam with Netflix. If they have a copy of the movie you want it doesn't matter where it is. I've had movies come from clear across the country and it took a couple of days more to get them but I did in fact get them. I could ask for no more than that.
    ZippyDSM (AfterDawn Addict) 20 January 2007 15:47 Send private message to this user   
    I noticed BB online is not as neat and detailed as NF 0-o
    this surprise's me,BB should do better than that...
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