CEO sees Blockbuster role in loading media devices

By Franklin Paul and Michele Gershberg

NEW YORK, Nov 8 (Reuters) - Blockbuster Inc (BBI.N: Quote, Profile, Research) wants to help customers connect their iPods and BlackBerries to their favorite movies and games in a service it hopes will build traffic back to its stores.

Chief Executive Jim Keyes said the company is talking to both hardware and software makers about turning the No. 1 U.S. video rental chain into a destination for loading digital media players with movies and games. The method should eventually be as easy as taking cash out of an ATM machine, he said.

"As millions of customers now have devices that are able to play media and movies, it is not a convenient solution for them to be able to load their own device," Keyes told Reuters in an interview. "That's what we do, we provide convenient access to content."

Keyes spoke after discussing the company's strategy in New York, where he told analysts he would reexamine pricing models and test new retail formats for its stores to restore growth. The former CEO of convenience store chain 7-Eleven took the helm at Blockbuster in July.

Wall Street received the idea with skepticism, sending company shares as much as 11.6 percent lower to $4.28 on the New York Stock Exchange. The stock closed down 2.9 percent at $4.70 and has lost 11 percent since the beginning of the year.

Earlier this month, Blockbuster posted a wider quarterly loss as it closed stores around the world. It has turned its focus to boosting sales at remaining stores and away from an online battle with rental service Netflix Inc (NFLX.O: Quote, Profile, Research).

Keyes acknowledged that his vision for making thousands of blue-and-yellow framed Blockbuster stores a destination in the same league as Apple Inc.'s (AAPL.O: Quote, Profile, Research) popular retail experience would not be easy or happen overnight.

But he does see the company building kiosks for downloading entertainment onto portable devices, including systems like Sony Corp.'s (6758.T: Quote, Profile, Research) PlayStation 3 video game console.