Exhibit 99.1

         MOVIE GALLERY REMAINS CONFIDENT THAT ITS MERGER AGREEMENT WITH
                             HOLLYWOOD IS SUPERIOR

   Looks Forward to Moving Expeditiously to Close Before or During the Second
                                  Quarter 2005

     DOTHAN, Ala., Feb. 3 /PRNewswire-FirstCall/ -- Movie Gallery, Inc. (Nasdaq:
MOVI) today issued the following statement in response to Blockbuster Inc.'s
(NYSE: BBI) proposed exchange offer to acquire Hollywood Entertainment
Corporation (Nasdaq: HLYW).

     Movie Gallery has entered into a definitive merger agreement to acquire
Hollywood for $13.25 in cash. We believe our pending merger is better for
Hollywood's shareholders, employees and customers than the Blockbuster offer,
which consists of $11.50 in cash and $3.00 in Blockbuster stock.

     Substantially all of Hollywood's stores compete with Blockbuster stores; in
fact, more than 80 percent of Hollywood's stores are in the same local market as
a Blockbuster store. As a result, the viability of Blockbuster's offer depends
on antitrust regulators accepting an untested expanded market theory proposed by
Blockbuster. By contrast, relatively few Movie Gallery stores are located close
to a Hollywood store.

     Movie Gallery anticipates a straightforward regulatory approval process for
its transaction with Hollywood. Because of the Federal Trade Commission's
investigation and second request process related to Blockbuster's proposal,
there is likely to be further regulatory delay in the Blockbuster transaction
and substantial risk that it will not be approved at all.

     We believe our all-cash acquisition of Hollywood entails greater closing
certainty and will deliver concrete value to Hollywood shareholders sooner than
a Blockbuster acquisition. We expect to close our transaction before or during
the second quarter 2005.

     About Movie Gallery
     Movie Gallery, Inc. is the third-largest company in the specialty video
retail industry based on revenues and the second-largest in the industry based
on stores. As of December 31, 2004, Movie Gallery owned and operated 2,482
stores located primarily in the rural and secondary markets throughout North
America. Since the company's initial public offering in August 1994, Movie
Gallery has grown from 97 stores to its present size through acquisitions and
new store openings.

     Forward-Looking Statements
     This news release contains forward-looking statements relating to Movie
Gallery's intent to acquire Hollywood Entertainment. Specific forward-looking
statements relate to Movie Gallery's expectations regarding the potential
benefits of such transaction, including the anticipated benefits to Hollywood's
shareholders and customers. These forward-looking statements are based on Movie
Gallery's current intent, expectations, estimates and projections and are not
guarantees of future performance. These statements involve risks, uncertainties,
assumptions and other factors that are difficult



to predict and that could cause actual results to vary materially from those
expressed in or indicated by them. In addition, some factors are beyond Movie
Gallery's control. Certain statements made in this release are contingent upon
completion of the proposed transaction. Other factors that could cause actual
results to differ materially from the statements made in this release include,
among others: (i) Movie Gallery's and Hollywood's ability to receive all
necessary approvals, including any necessary governmental or regulatory
approvals and the approval of the Hollywood stockholders, if applicable; (ii)
matters related to closing conditions contained in the merger agreement between
Movie Gallery and Hollywood, including conditions to the consummation of the
financing contemplated by the merger agreement; and (iii) other factors as
described in Movie Gallery's filings with the Securities and Exchange
Commission, including the detailed factors discussed under the heading
"Cautionary Statements" in Movie Gallery's annual report on Form 10-K for the
fiscal year ended January 4, 2004.

     HOLLYWOOD STOCKHOLDERS ARE URGED TO READ THE DEFINITIVE PROXY STATEMENT
REGARDING THE PROPOSED TRANSACTION WHEN IT BECOMES AVAILABLE, BECAUSE IT WILL
CONTAIN IMPORTANT INFORMATION. Stockholders will be able to obtain a free copy
of the definitive proxy statement, as well as other filings containing
information about the parties, without charge, at the Securities and Exchange
Commission's Internet site ( http://www.sec.gov ). Copies of the definitive
proxy statement and the filings with the SEC that will be incorporated by
reference in the proxy statement will also be available, without charge, by
directing a request to Hollywood Entertainment Corp., 9275 S.W. Peyton Lane,
Wilsonville, Oregon 97070, Attn: Investor Relations.

     The directors and executive officers of Hollywood and other persons may be
deemed to be participants in the solicitation of proxies in respect of the
transaction. Information regarding Hollywood's directors and executive officers
will be available in the definitive proxy statement. Other information regarding
the participants in the proxy solicitation and a description of their direct and
indirect interests, by security holdings or otherwise, will be contained in the
definitive proxy statement and other relevant materials to be filed with the SEC
when they become available.

     Contact:  Thomas D. Johnson, Jr.
               SVP - Corporate Finance &
               Business Development
               (334) 702-2400

SOURCE  Movie Gallery, Inc.
    -0-                             02/03/2005
    /CONTACT:  Thomas D. Johnson, Jr., SVP - Corporate Finance & Business
Development of Movie Gallery, Inc., +1-334-702-2400/
    /Web site:  http://www.moviegallery.com /
_