DISH's Blockbuster Deal

When you've got lemons, make lemonade. When you're a satellite TV service provider and suddenly inherit a huge inventory of DVDs, Blu-rays and videogames, why not  share them with your existing  customers for a modest monthly uptick fee ($10)  or "free" to newly converted subscribers?

That's a strategy working in the  Blockbuster Movie Pass rental and streaming offering which DISH Network announced Friday and instigates Oct.1 - as a "value-added" retort to both  Netflix and  rival cable/satellite TV services.

Seven months ago, DISH acquired the struggling Blockbuster video and game rental operation. It shuttered a bunch of underperforming stores, but obviously kept  the inventory. Among its features, Blockbuster Movie Pass promises "more than 100,000 DVD movies, TV shows and games available"  by mail, including more than 3,000 video games for Xbox and Xbox 360,   PlayStation 2, PlayStation 3 and Nintendo Wii systems. 

Unlike Netflix, there'll be no premium fee if you prefer to get your movies by mail in  Blu-ray form from Blockbuster Movie Pass.  But of course you'll pay a $5 or $10 monthly uptick to have two or three movie and/or game titles out simultaneously,

Also, different from Netflix,   subscribers can exchange the movie and game discs at a Blockbuster store (if you can find one), instead of mailing them back. Plus the Blockbuster Movie Pass  contains a streaming option at no additional cost  - yeah, the way Netflix used to be, before it  split apart the mail and streaming businesses this summer and turned off at least a million customers.

 Initially, the streaming aspect  of BMP will offer more than 4,000 movies and "hundreds" of on-demand TV shows for delivery to a PC and "more than 3,000 movies" streaming to your TV. Instant access to the "classic" titles of some second tier movie channels  like EPIX, MGM and and Sony Movie Channel   is also in the bundle.(By comparison, Amazon Prime offers 9,000 streaming titles; Netflix Instant Watch claims a catalogue of 20,000.)

But to subscribe to BMP and to  watch all its streaming content on a television,  you'll need to have a network-connected DISH receiver/DVR. That  means  subscribing to a DISH monthly satellite TV package.  You won't be able to just pull the content down (at least initially) on  a  set top box from Roku or Boxee or a networked Blu-ray player or TV -  the way Netflix, Vudu, Amazon Prime conduct most of their business.

To sweeten the deal, DISH will give  Blockbuster Movie Pass away for free, for a year,  to new customers who sign up for DISH Network's $40 a month America's Top 200 programming package (or greater) with a 24 month commitment.

I see the fine hand of DISH Network's new CEO Joe Clayton in all of this. A master marketer  of  consumer electronics, Clayton's been working the "value added" angle since his days at RCA - where the company sold us on  VHS (destroying Betamax) with the "records longer" feature,  then launched DirecTV's small dish satellite TV with spiffy, reliable RCA hardware. Later, Joe moved on to Sirius satellite radio, where his  exclusive channel deals with the NFL and Howard Stern brought millions of new subscribers into the fold.

 Can Joe do it again?