Blockbuster bags Movielink

10 08 2007

Blockbuster has acuired Movielink LLC, the online movie downloads service established by five major Hollywood studios in 2002. Terms were not disclosed.

The Wall Street Journal claims a source familiar with the deal put the acquisition price tag at “less than $20 million”. paidContent puts it lower still: “we do know that there is a surprisingly low cash amount involved (much lower than WSJ’s)” 

Update 15 Aug 07: According to a filing yesterday with the U.S Securities and Exchange Commission, Blockbuster paid just $6.6 million in an all-cash deal.

Studio founders including Metro-Goldwyn-Mayer Studios, Paramount Pictures, Sony Pictures Entertainment, Universal Studios and Warner Bros. are believed to have lavished $100 million on the service, which failed to capture public imagination as a consequence of its owners’ failure to back it up with significant marketing effort.

The acquisition bolsters Blockbuster’s online video services and will likely put troubled competitor Netflix under even greater pressure.