How an Oregon rental shop grew into Blockbuster's only real rival
Hollywood Entertainment Corporation opened its first Hollywood Video store in 1988 and spent most of the 1990s growing the obvious way, by putting a big, bright store across the road from whatever Blockbuster had already built.
The strategy worked. As of December 31, 2004, Hollywood Entertainment operated 2,006 Hollywood Video stores in 47 states and the District of Columbia, according to the annual report it filed with the Securities and Exchange Commission for that year. Revenue across the four quarters of 2004 came to about $1.78 billion, up $99.8 million, or 5.9 percent, on 2003.
A second business ran inside the same walls. That filing counted 695 Hollywood Video stores with an in-store Game Crazy department, used-game counters the company described as places "where game enthusiasts can buy, sell and trade new and used video game hardware, software and accessories." Customers could trade in titles the way they did at GameStop without leaving the rental aisle.
That made Hollywood Entertainment the number two video rental company in the country and the only chain with enough locations to give Blockbuster a real fight. It was also a company whose model assumed people would keep driving somewhere to collect a plastic disc and then drive back to return it.
What Movie Gallery paid for Hollywood Video in 2005
The buyer was Movie Gallery, a rental company based in Dothan, Alabama, that had built its business on small towns and strip malls rather than dense suburbs.
Movie Gallery announced on April 27, 2005 that it had completed its acquisition of Hollywood Entertainment Corporation. The transaction was valued at $1.25 billion, including $862.1 million for Hollywood Entertainment's outstanding common stock and the assumption of $384.7 million of its existing debt.
On paper the two halves fit. Movie Gallery had the rural coverage, Hollywood Video had the metro stores, and together they were second only to Blockbuster in the United States.
The balance sheet is what broke. Movie Gallery had been a profitable operator of small stores, and it took on the debt of a company roughly its own size to buy a metro footprint. Within two and a half years that debt put it in front of a bankruptcy judge, and the $384.7 million it assumed was only the part of the bill already sitting on Hollywood Entertainment's books.
Why the 2007 bankruptcy did not close the stores
Movie Gallery filed for Chapter 11 bankruptcy protection on October 16, 2007, after months of struggling with the debt from the Hollywood Entertainment purchase. In the filing it listed about $892 million in assets against $1.4 billion in debt.
Steve Moore, the chief restructuring officer, said the company was facing "looming defaults" on its loan agreements.
That first case was a restructuring, not a liquidation. Movie Gallery moved to shut roughly 520 unprofitable stores and won interim court approval to draw $140 million of a $150 million debtor-in-possession facility arranged by Goldman Sachs, which kept the remaining stores stocked and the staff paid while the case ran.
The plan converted about $400 million of debt into equity, with the investment fund Sopris Capital Advisors financing the reorganization. Movie Gallery left Chapter 11 in 2008 with fewer stores and a lighter balance sheet, and for a year and a half the Hollywood Video sign stayed lit. What it did not have was a business that worked without the stores.
What finally shut every Hollywood Video location
Movie Gallery went back into Chapter 11 on February 3, 2010, less than two years after leaving it. This time the pressure was not another chain of stores.
It came from the mail, from vending machines and from broadband. Netflix was shipping discs to the door, Redbox kiosks were charging a dollar a night outside grocery stores, and streaming was starting to make the drive itself look pointless.
The company entered that second bankruptcy with roughly 2,500 stores in North America across the Movie Gallery, Hollywood Video and Game Crazy brands. In May 2010 it moved to liquidate rather than restructure, telling the bankruptcy court it would close its more than 1,900 remaining stores.
The wind-down took the summer. The last United States stores closed by July 31, 2010, and the final Canadian locations shut on August 8, 2010. Game Crazy went with them, and so did the rental accounts, the membership files and about two decades of late-fee records, which turned out to be the most durable asset the company owned.
Who owns Hollywood Video today?
No company operates Hollywood Video stores. What still has an owner is the name. The HOLLYWOOD VIDEO trademark, filed on April 19, 2002 and registered on July 26, 2005, is held by MGIP, LLC, an intellectual property holding company in Hillside, New Jersey, and its United States registration was live and renewed as of February 2026.
MGIP, LLC holds the rest of the family too, including the MOVIE GALLERY, HOLLYWOOD VIDEO SUPERSTORE and GAME CRAZY marks. A live registration is not a business plan. It keeps the name off limits to everyone else and leaves the door open to a revival nobody has announced, which is why the honest answer in 2026 is a holding company rather than a retailer.
There is no successor chain either. Hollywood Entertainment was absorbed into Movie Gallery in 2005, Movie Gallery was wound down in 2010, and the name has not been attached to a working rental business since.
Where to find one today. What left the stores during the going-out-of-business sales was paper and plastic: laminated membership cards, employee name badges, promotional standees and the yellow-and-black clamshell rental cases. Those turn up on Etsy's search page for Hollywood Video memorabilia, where cards and badges tend to be the cheapest items and store signage the most expensive. Prices swing widely by condition and by how much store branding survives, so compare several listings before paying up for anything described as rare.
The late fees that outlived the company
When the stores closed, the estate still held a mountain of unpaid rental charges. The approved plan created a liquidating trust to collect an estimated $244 million reportedly owed by 3.3 million former customers.
The trust contracted the work to Credit Control Services of Massachusetts, which subcontracted it to National Credit Solutions of Oklahoma. Complaints started almost immediately. Former customers said they were being billed for fees they had never been told about, and in many cases the first they heard of it was a rejected credit application.
Mary Lobdell, an assistant attorney general in Washington state, said her office received "a flurry of complaints from Washington residents who told us they didn't owe the fees" before those debts reached the credit bureaus.
The settlement that followed in 2011 was signed by the attorneys general of all 50 states and the District of Columbia. It required the trustee to rescind the adverse credit reports it had already filed, to stop collection whenever a consumer disputed a notice until the account was verified, and to stop charging both a late fee and the full price of an unreturned item.
Frequently Asked Questions
When did Hollywood Video close?
Hollywood Video closed in 2010. Parent company Movie Gallery filed for Chapter 11 bankruptcy protection on February 3, 2010, and in May 2010 told the bankruptcy court it would liquidate and close its more than 1,900 remaining stores. The last United States locations closed by July 31, 2010 and the final Canadian stores on August 8, 2010.
Who owns Hollywood Video now?
Nobody operates Hollywood Video as a business. The HOLLYWOOD VIDEO trademark is held by MGIP, LLC, an intellectual property holding company in Hillside, New Jersey, whose United States registration was live and renewed as of February 2026. The same company holds the MOVIE GALLERY and GAME CRAZY marks, and no revival of the chain has been announced.
How many Hollywood Video stores were there?
Hollywood Video peaked at 2,006 stores in 47 states and the District of Columbia as of December 31, 2004, 695 of which had an in-store Game Crazy department. By the time parent company Movie Gallery liquidated in 2010 it ran roughly 2,500 stores across North America under its Movie Gallery, Hollywood Video and Game Crazy brands.