Blockbuster's Broadband-Video Deal Collapses

From Bloomberg News

Enron Corp. and Blockbuster Inc., the world's largest video store chain, ended their exclusive 20-year relationship to deliver movies on demand just eight months after announcing the alliance.

Enron, which owns a fiber-optic telecommunications network, said Blockbuster didn't provide the "quantity and quality" of movies needed to drive the service.

Unlike current pay-per-view movies on cable TV, the broadband technology lets viewers start watching at any time, rewind and pause. Blockbuster said it ended the relationship because it didn't want to be tied to one mode of movie delivery.

Both companies said they wanted to have more than one partner.

Enron plans to provide on-demand entertainment, including movies, games, television programs, sports and music, to consumers' television sets.

The four cities with trials of the joint Enron-Blockbuster service will continue to be served until the trial period concludes at the end of this month, the companies said. The companies have contracts with ReFlex Communications in Seattle and Portland, Ore., and SwitchPoint Networks in Salt Lake City to provide the final high-speed link into consumers' homes. The companies also are conducting technical trials with Verizon Communications Inc. in New York.

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