Prelude to New Cellphone Service? 'Blockbuster Mobile' Starts Selling Phones

Dish Network Exploring a New Way to Disrupt

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Dish Network's Blockbuster will begin selling mobile phones in its movie-rental stores as a test for Dish's planned entry into the wireless business, according to two people familiar with the matter.

Blockbuster stores will soon sell phones under the banner 'Blockbuster Mobile.'
Blockbuster stores will soon sell phones under the banner 'Blockbuster Mobile.' Credit: Jin Lee/Bloomberg

Blockbuster recently started selling phones on its website under the banner "Blockbuster Mobile," working with carriers such as Verizon Wireless, Sprint Nextel and T-Mobile USA. The effort will soon shift to Blockbuster's roughly 850 retail locations, said the people, who asked not to be named because the plan hasn't been announced.

For Dish, a satellite-TV service provider that acquired the Blockbuster chain last year, the move may be a prelude to offering its own mobile-phone service. The Blockbuster program will let the company learn the ropes of selling phones to consumers, the people said. Dish has acquired a swath of wireless airwaves and is awaiting rules from the Federal Communications Commission governing how it can use them.

Bob Toevs, a spokesman for Dish, didn't have an immediate comment on the Blockbuster plan.

Chairman and co-founder Charlie Ergen said in October that he plans to team up with another company to help Dish introduce its wireless service. Discussions with potential partners are on hold until Dish hears from the FCC, Chief Executive Officer Joe Clayton said in an interview yesterday.

"Wireless will complement all of our technologies and allow us to be in more places and offer more of our services on one bill," he said.

Dish has planned on using Blockbuster stores to sell phones since buying the chain in April 2011, Mr. Ergen said in October. The stores continue to rent and sell DVDs, and Dish already uses the locations to market its satellite-TV service.

The Blockbuster chain is a fraction of its original size, hurt by the rise of Netflix Inc.'s mail-order service and streaming online video. Dish has closed about half of the stores since acquiring the company out of bankruptcy last year. When Blockbuster was owned by Viacom Inc. in 2004, it operated about 9,000 locations.

~Bloomberg News~

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