The video rental business is changing as more customers are downloading movies from the Internet rather than renting them through the mail from online sites like Netflix or from stores like Blockbuster. Go to Blockbuster’s and Netflix’s websites and review the initiatives or actions that these companies are implementing as part of their strategic plan to address the changing nature of their business.

1. Identify at least two initiatives or actions that one of these companes is implementing that you believe will affect revenue or expenses.

2. Identify the variable costs and fixed costs of these companies.

3. Speculate on how the changes that these companies are making will affect their breakeven point in units (movie rentals).