Blockbuster Inc. has filed for chapter 11 bankruptcy amidst increase competition from Netflix, iTunes and others; the video renting giant has debts of around $900 million.
The first report of the chapter 11 filing was published by the Wall Street Journal, hinting that the company is fulfilling final formalities to file for bankruptcy due to heavy debt and rapidly changing business environment.
“Blockbuster, struggling amid more than $900 million in debt, could file for protection from creditors under Chapter 11 of the U.S. Bankruptcy Code in the next few days, said people familiar with the matter.” the WSJ wrote.
Blockbuster operations outside the US includes around 4,000 stores in Canada, UK, Australia and Mexico and are not included in the Bankruptcy as they are independent legal entities.
The company faced a dramatically different landscape from when it was launched with postal delivery, video on demand and online video renting rising to compete with it.