My thoughts are that a hybrid online/offline service requires the infrastructure of a store mini-DC. These stores ship and receive DVDs in the mail and check them into the BBI Online database. Currently there are several online in LA. BBI will have 1,000 by 2006.
BBI's goal is to convert 4,500 total. BBI is said to have ~5,100 total stores in the US. Once converted, these stores will be ripe for a hybrid online/offline movie pass. A perfect service destinguishable from any other competitor on earth.
I'd expect such a hybrid service to reap much higher sub fees and steal substantial share from NFLX. BBI will be a cash cow.