Margins?
I suspect Best Buy's margins on TVs are pretty slim. And with Fry's selling name brand lap tops for $500, Best Buy is going to have a tough time there, too. With video games coming out by the dozens every week, they're going to have to invest in a lot of inventory in hopes that a few might sell well.
But they're not the only one hurting. All the electronics retailers are in much the same bind. It's not that the internet businesses are cutting into them, it's consumers demanding lower prices. And the demand of a year ago is down, as "everybody" who wants a flat panel has "probably" "already" bought one. So it's people like me who only want to pay $1000 for one that they have left to sell to. Even the prices on 1080p sets have fallen dramatically. Best Buy isn't competing with Circuit City or Fry's, they're competing with history. And history always wins.