This should be a good thing. Competition can only help the consumer.
I used to despise Netflix with every fiber of my being due to their aggressive and intrusive online ads. Then I stopped using IE and started blocking pop-ups and gradually my hatred faded enough to give the service a try.
And now I’m a huge fan. One thing that Netflix offers that Blockbuster doesn’t, at least in their brick & mortar stores, is a huge selection of non-mainstream DVDs: anime, foreign films, tv series on DVD (though I suppose the latter is fairly mainstream these days).
Blockbuster has its work cut out for them, but another intriguing factor is the idea of renting games and DVD’s from the same source. If I could get the same quality of service that I get from Netflix and Gamefly via one account with Blockbuster, I might be convinced to switch.