Rental company to close 24 stores, lay off 200
HONG KONG — Blockbuster announced on Friday that it will be shutting down in Hong Kong.
Blockbuster, the publicly traded video rental unit of global entertainment giant Viacom, says it will close its 24 stores in Hong Kong as its leases expire over the next 18 months. The company will lay off 200 employees, according to Michael Wong, the director of marketing of Blockbuster Hong Kong.
The main reason cited for the exit is operational costs, not piracy for which Hong Kong is known.
“Hong Kong has always been one of the film capitals of Asia, but it has been a very expensive market to develop and operate, with store lease costs being among the highest we have anywhere in the world,” said Chris Wyatt, president of Blockbuster International, in a statement released by the company.
“Piracy isn’t a major reason [for the exit],” says Wong. “We have operations across 28 countries and piracy is an issue in every one of those markets.”
Blockbuster has 200,000 members in Hong Kong and has been in the market since January 1999.