Satellite television company Dish Network will acquire the assets of Blockbuster after bidding $320 million for the bankrupt video rental business. The deal is symbolic of the decline of the movie rental store in the face of competition from other movie rental and streaming companies like Netflix.

Blockbuster filed for Chapter 11 bankruptcy protection in September 2010, facing challenging losses, with assets of $1 billion, debts of nearly $1.5 billion, and increasing competition from Netflix, Redbox and video-on-demand and online streaming services.

“With its more than 1,700 store locations, a highly recognizable brand and multiple methods of delivery, Blockbuster will complement our existing video offerings while presenting cross-marketing and service extension opportunities for Dish Network,” said Tom Cullen, executive vice president of sales, marketing and programming for Dish Network. “While Blockbuster’s business faces significant challenges, we look forward to working with its employees to re-establish Blockbuster’s brand as a leader in video entertainment.”

Beyond that statement it is unclear quite what Dish will do with Blockbuster. The satellite pay-television provider saw its 14 million subscriber base fall by 2% in 2010, while online video services like Hulu and Netflix are continuing to grow. It seems most likely that Dish will use the Blockbuster brand to extend its own online movie streaming service in support of its subscription business and shutter most of the stores. Whether that will be able to compete with Netflix is another matter.

Although it seems the Blockbuster brand may live on, it will surely be seen as the end of the era of renting tapes and discs as the movie market moves to streaming and viewing on demand.