Reuters
Wednesday, January 3, 2007; 6:33 PM

LIMA (Reuters) - The last movie rental outlet under the brandname of U.S. home entertainment giant Blockbuster has closed its doors in Peru, where it is often cheaper to buy a pirated DVD, than it is to legally rent one.

Randy Hargrove, U.S.-based spokesman for Blockbuster Inc (BBI.N), told Reuters on Wednesday the closure was linked to competition problems, but did not elaborate any further.

"I can confirm the last shop shut down a few days ago... For now there are no plans to reenter the Peruvian market," he said.

Illegal copies of DVDs with Hollywood blockbusters can be bought for around $1 from street vendors in downtown Lima, while it often costs twice as much to rent a licensed copy.

There were a dozen Blockbuster franchise rental outlets, operated by Video International Peru, in the country two years ago. Local daily newspaper El Comercio said Video International Peru officials last year blamed piracy for slumping revenues of the franchise.