Listens: the cardigans - erase and rewind

Help with Removing People in the Background

Hello,
I am not sure what category this problem falls under, but hopefully someone here can help.

I have this image. I don't want to change the size of the image, but I want to blur the person in the red box out of the image, so that I can extend the blue background to cover where the person was previously.

I've already tried using the blur and smudge, but it didn't give me what I wanted.

I'm using CS3.

Can some please link me to tutorial or explain to me the process in which I'd go about to do it?

Thank you for your help in advance.