Movie Gallery To Close: Reports

By Alan Wolf -- TWICE, 5/6/2010

Wilsonville, Ore. - Movie Gallery, which filed for Chapter 11 bankruptcy protection in February for the second time in three years, now plans to shut its 1,906 Movie Gallery, Hollywood Video and Game Crazy retail stores, according to published reports.

The company, which acquired Mark Wattles' Hollywood Entertainment following a costly bidding war with Blockbuster, succumbed to competition from mail and kiosk DVD rentals and streaming video, and pressure from GameStop, which dominates gaming software at retail.

Movie Gallery would not confirm the liquidation, but published reports cited leaked internal memos and letters to local municipalities announcing the closures.

Game Crazy, which had CE sales of $338 million last year, was created as a sister chain to investor Mark Wattles' Hollywood Video, with many of its stores located within or adjacent to the video rental outlets.