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How Blockbuster Could Have Owned Netflix

Unknown Lamer posted about 9 months ago | from the video-store-killed-the-video-store dept.

Businesses 385

schnell writes "Your age probably determines whether you think of Blockbuster Video as a fond memory or a dinosaur predestined for extinction. While the last Blockbuster rental at the last remaining Blockbuster video store took place last week, Variety retells a now-classic story of how Blockbuster could have bought Netflix for a song, but didn't because it failed to take the new DVD-by-mail and video streaming markets seriously. Who is next to join Blockbuster, Polaroid, Borders and Best Buy on the ash heap of superseded retail business models?"

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385 comments

Who's next? (5, Insightful)

Anonymous Coward | about 9 months ago | (#45411853)

Slashdot!

Re:Who's next? (2)

BreakBad (2955249) | about 9 months ago | (#45412093)

With the ability to order life like 'companions' and the plethora of free pr0n I see the oldest occupation falling on 'hard' times. ba'dah bump.

Re:Who's next? (5, Funny)

Anonymous Coward | about 9 months ago | (#45412219)

Slashdot!

Dice, Dice, Baby!

Re:Who's next? (1)

couchslug (175151) | about 9 months ago | (#45412439)

"Slashdot!"

Nah, this place is almost as much fun as 4chan and for the same reasons.

Now how do I Triforce?

Pretty much. (5, Interesting)

Anonymous Coward | about 9 months ago | (#45411911)

I remember when netflix first started out, it took blockbuster YEARS to FINALLY get a dvd by mail system, and it was still overpriced as hell.
They continued to make moves acting as a monopoly, refusing to believe they could ever have any competition.
This was a fatal mistake.

Re:Pretty much. (2, Insightful)

FearTheDonut (2665569) | about 9 months ago | (#45412255)

This reminds me of Microsoft....

Re:Pretty much. (3, Insightful)

TWiTfan (2887093) | about 9 months ago | (#45412319)

Yes, Blockbuster lagged behind and was a victim of their own hubris, but I'll still miss them. I never was a huge fan of Netflix going to the subscription system for DVD's. I miss being able to go down to a video store and rent a physical DVD/Blu-ray of the latest videos at a flat rate (with better video quality and all the great extra features that you don't get with streaming).

Unfortunately, Netflix is likely on the verge of abandoning their DVD/Blu-ray by mail program, and special rental versions have all but made extra features an extinct species (still not sure why Blockbuster started buying those and gave up the ONE major advantage they had over streaming services, were they really THAT much cheaper?). One of the great things about DVD's/Blu-Rays (and even before that laserdiscs) were those great commentary tracks and extra features. Sometimes they were better than the movie itself (Cannibal: The Musical, anyone?). Now I'm afraid they're gone for good. No more great commentary tracks and making-of documentaries for us film buffs. And, until bandwidth improves, no more 30mbps 1080p video.

Re:Pretty much. (3, Interesting)

pnutjam (523990) | about 9 months ago | (#45412447)

I'm glad to see those making-of and the "Let me tell you why I'm so great" extra features go away. I found them pretentious and irritating.

However, I'm not a huge movie buff, so take my opinion for what it is worth.

Re:Pretty much. (4, Interesting)

L. J. Beauregard (111334) | about 9 months ago | (#45412605)

What I most dislike about the rental versions is that they often have trailer after trailer and they disable the "skip this" button. (Note to DVD vendors: DO. NOT. DO. THAT. If I choose to skip the trailer, you have already lost the sale. Giving me that damned icon instead of doing as I asked only annoys me.)

Re: Pretty much. (1)

Anonymous Coward | about 9 months ago | (#45412777)

Why are you blaming DVD vendors? Blame your DVD player for strictly following some code instead of what you're explicitly telling it to do. Or blame the DVD patents that are used to force licensed DVD players to do this. Or just play the DVD on your computer using software that does what you tell it to do.

They vary (1)

Causemos (165477) | about 9 months ago | (#45412757)

As with movies, the quality of extras varies greatly. Simple goof reels and dry technical descriptions are one thing, but when they take the time to find real stories in the process it's a whole different world. On a movie you truly like, a good commentary and collection of extras videos can be as enjoyable as the movie itself.

Re:Pretty much. (4, Interesting)

fermion (181285) | about 9 months ago | (#45412533)

I recall reading an article about the guy who built blockbuster. He was originally in trash. That is, he rented the big bins for commercial trash. He stated that blockbuster and trash collection were basically the same thing. One has some initial investment that does not degrade much over time, and after a while that investment is covered with rental fees. After that it is pure profit. So the idea of blockbuster was to turn over product as quickly as possible to pay for the initial product and get into a profit position. Obviously things like late fees helped. The idea of paying a flat fee for as much product as you wanted for as long as you wanted did not.

Of course this guy has long left Blockbuster and is doing other things, so there was room for new management to do other things. OTOH, I can see how blockbuster might be attached to their original business model, brick and mortar and all that. Really what has killed them is the long term decline in the value of movie you watch at home. There was a time when you were paying $50-100 to buy a video, so paying $5 to rent it was a value. Eventually studios realized how much money they were leaving on the table, dropped prices for many movies, and cut sweetheart deals with blockbuster, which further eroded the value of home video, and made Blockbuster prices seem expensive. Finally the internet made movies free, Netflix figured out how to compete with free, and blockbuster did not. Really, blockbuster, like other firms simply could not keep the legacy structure and succeed.

Typical (3, Insightful)

PPH (736903) | about 9 months ago | (#45411917)

Some business people look inwards to optimize their existing business in search of profits. Others look at how the market around them changes. Changing ones business model is stressful and not something everyone can do.

Besides, as an investor, I'd rather put my money where I think the market is going. If management keeps changing focus, I never know what I'm pursuing. Let the Blockbusters of the world rise and fall. I'll buy in or cash out of the trends as I see them.

Every print magazine left. (5, Funny)

Narcocide (102829) | about 9 months ago | (#45411925)

Followed shortly thereafter by the USPS, unless Amazon just outright buys them.

Re:Every print magazine left. (5, Interesting)

The Phantom Mensch (52436) | about 9 months ago | (#45412191)

I'm not sure I'd right off the USPS. Their parcel business seems to be growing rapidly, with very competitive prices for small fixed price boxes.

I think the big shopping mall anchor stores (Macy's, JC Penney, etc) are all likely to fail in the next 20 years. Sears is already a dead man walking, Penney's is close and the others are living on borrowed time.

Fitting rooms (5, Insightful)

tepples (727027) | about 9 months ago | (#45412293)

I think the big shopping mall anchor stores (Macy's, JC Penney, etc) are all likely to fail in the next 20 years.

Department stores have one big advantage over online stores: fitting rooms.

Re:Fitting rooms (1)

KillaGouge (973562) | about 9 months ago | (#45412393)

What is to stop Amazon from buying up departments stores for a dime right before they finally fold and having Amazon stores, where you can try some things on, order it, and it is at your house by the time you get home?

Re:Fitting rooms (2)

Guido von Guido II (2712421) | about 9 months ago | (#45412649)

They'd have to run them, which costs money. It would be a big change to their business model, and it's not necessarily something they'd be good at. As such, it's a big risk. Which doesn't mean they won't try.

Re:Fitting rooms (1)

seinman (463076) | about 9 months ago | (#45412713)

One of the primary reasons that Amazon prices are so low is because they don't have any retail buildings to staff and maintain. If they start buying up stores and stocking them with staff, equipment, and merchandise, they will lose that edge.

Re:Fitting rooms (1)

sehryan (412731) | about 9 months ago | (#45412513)

So does the Gap, and all other smaller clothes stores. So does Kohls, Marshals, and all other "discount" clothes stores.

As with Blockbuster, the threat was not solely from online, but a mix of online and alternative retail.

Re:Fitting rooms (0)

Anonymous Coward | about 9 months ago | (#45412523)

Department stores have one big advantage over online stores: fitting rooms.

And then people go home, buy the clothes in the size they want online at a significant savings.

Re:Every print magazine left. (1)

Guido von Guido II (2712421) | about 9 months ago | (#45412613)

I'm not sure I'd right off the USPS. Their parcel business seems to be growing rapidly, with very competitive prices for small fixed price boxes.

In Canada, I greatly prefer Canada Post to UPS or any of the other corporate carriers like DHL. I've had carriers stick my packages in the mailbox (which is fine) and fake a signature (which is not). They ring the doorbell and walk away without leaving a note to tell me they were here. If I'm home I have to run to the door to have any chance of catching them. Sometimes they leave my packages sitting on my front door (I live downtown on a busy street). With UPS and DHL, sometimes I have to go out to the burbs to pick up a package I missed, sometimes they leave it at a local location.

With Canada Post, though, it's almost always smoother and more pleasant. If I'm not home the package either goes into the mailbox or I get a note to pick it up the next day someplace local.

I think the big shopping mall anchor stores (Macy's, JC Penney, etc) are all likely to fail in the next 20 years. Sears is already a dead man walking, Penney's is close and the others are living on borrowed time.

This will be interesting. I'm not sure that *all* of them will fall, although I think most of them will. As tepples said, fitting rooms are pretty damn useful. However, the stores that survive might be smaller, clothing-specific stores like Old Navy or Eddie Bauer.

Sears has been horribly mismanaged for a long time. Even if department stores were healthy I think they'd be in trouble.

Re:Every print magazine left. (1)

Bill_the_Engineer (772575) | about 9 months ago | (#45412719)

In Canada, I greatly prefer Canada Post to UPS or any of the other corporate carriers like DHL. I've had carriers stick my packages in the mailbox (which is fine) and fake a signature (which is not).

UPS just sucks. I had packages sent to me marked "Signature Required" and come home to find that package sitting out in the open at the front door.

Re:Every print magazine left. (1)

spire3661 (1038968) | about 9 months ago | (#45412511)

Goddamnit, USPS is not supposed to be profitable. Its a function of the Republic.

Re:Every print magazine left. (1)

alexander_686 (957440) | about 9 months ago | (#45412645)

On the other hand, the USPS is not supposed to losing money. It is supposed to be self-sufficient.

It might make more sense to have direct subsidizes from the government to provided universal access in the more remote areas.

nevermind whether it's a public good or not... (0)

Anonymous Coward | about 9 months ago | (#45412771)

direct subsidizes from the government to provided universal access

ooooohhhhh! why you.... that's SOCIALISM!! <haid asplode>

Re:Every print magazine left. (0)

Anonymous Coward | about 9 months ago | (#45412647)

It should be profitable and run as a business.

Blockbuster Business Model (5, Insightful)

Greyfox (87712) | about 9 months ago | (#45411941)

They'd have tried to shoe-horn late fees into Netflix. That's where all Blockbuster's money came from. Renting videos was just a loss leader for late fees. They didn't take Netflix seriously because they didn't have late fees and Blockbuster didn't see how anyone could make money just renting videos.

About Polaroid... (5, Interesting)

TheloniousToady (3343045) | about 9 months ago | (#45411951)

Polaroid is already gone. For the last few years, ever since they stopped making instant film, Polaroid has been nothing more than a brand name to be licensed out (presumably, to attract folks who still have fond memories of instant film.) For example, all those cheap portable Polaroid-brand DVD players are made by somebody else. That's in contrast to Best Buy, which is a real corporation, and Borders, which is at least a division of a real corporation, Barnes & Noble.

The amazing thing about Blockbuster (0)

Anonymous Coward | about 9 months ago | (#45411953)

Is how it managed to survive until 2013. Its imminent demise had been forecasted by just about everyone for the past 20 years.

Re:The amazing thing about Blockbuster (0)

Anonymous Coward | about 9 months ago | (#45412063)

From memory in 1993 Blockbuster (and videos rental in general) was doing well.

Hell I still had an account in 2003 (10 years past).

They'll be alright (0)

Anonymous Coward | about 9 months ago | (#45411955)

They've already transitioned to making bloatware for new cellphones.

Fuck blockbuster.

Fond memories? (1)

CubicleZombie (2590497) | about 9 months ago | (#45411957)

Like being raped with late fees?

If Blockbuster had bought Netflix, I would have cancelled my account immediately.

Too soon (1)

Marrow (195242) | about 9 months ago | (#45411965)

Hey, its a little too soon to talk about Borders that way. Some of us are still in mourning.

Re:Too soon (1)

drinkypoo (153816) | about 9 months ago | (#45412207)

Why the fuck (insert pic of Patrick Stewart here) would you miss Borders, the worst of all chain bookstores? They never ever have anything but new releases and the most popular of older works. If I'm going to order something and wait for it to come in, I'm not going to involve a bookstore. I'm going to get it much cheaper from Amazon or eBay. Borders was worthless, and in every case of which I'm aware it displaced something the people would rather have had.

Re:Too soon (1)

TheRaven64 (641858) | about 9 months ago | (#45412341)

Was Borders a bookstore? They seemed to have about as many books as a newsagent. I'd always thought that their business model was selling coffee to people who liked to be near books, but didn't actually want to read them...

Re:Too soon (1)

Anonymous Coward | about 9 months ago | (#45412457)

Not at all my experience - the Borders in my town had a comparatively huge section of STEM (advanced topics, not just the popular science stuff) and computer books (healthy selection of Linux and O'Reilly books). Prior to Amazon's selection, it was Borders or the local competitor's selection of Windows for Dummies and the narrow, 1/4 shelf selection of Sagan, Gould, etc.

I have fond memories of Borders back then (mid-90's), but they missed the rise of online and failed to pivot or react until it was too late. Such is life.

Re:Too soon (1)

stdarg (456557) | about 9 months ago | (#45412589)

I generally prefer Barnes and Noble to Borders, but in the town I lived in a few years ago there was only a Borders and it was a fine bookstore.

Both companies really popularized the idea of a large bookstore with popular books, lots of open space, chairs, and a cafe. They didn't at all mind if you bought a drink and read an entire book. It was like a library with enough copies of popular books to go around plus a built-in coffee shop. Who doesn't like that? And contrary to popular belief (e.g. the movie You've Got Mail), I have always found employees at these big stores to be knowledgeable about books (umm, not the high schoolers staffing the cafe area, but the floor employees). There's usually a shelf dedicated to staff picks and I've found some really interesting books by perusing that.

I don't know why public libraries don't invite coffee houses to set up shop in the same building for a rental fee. They're always complaining about not having enough money and *readers* would really enjoy it I think. Well, I take that back, I do know -- unfortunately most of the public libraries have decided to turn into free internet cafes for poor people. To save money, some of the public libraries in my area have moved into strip malls and drastically reduced their sizes.. now they're over 50% (by floor area) computer lab full of loud kids doing "homework" (playing online games) and homeless people looking at porn, probably 40% kids books, and 10% books that nobody is interested in because all the popular books (old and new) are checked out and wait-listed.

Uh, because it was a nice place to go find a book (1)

Marrow (195242) | about 9 months ago | (#45412641)

to read. If you wanted to read old stuff, then you should have been shopping at a used bookstore. They are good for the older titles and often have a broad selection. But Borders was a nice place to find a new book to read.

Re:Uh, because it was a nice place to go find a bo (1)

drinkypoo (153816) | about 9 months ago | (#45412755)

My favorite used bookstore is also a better new bookstore than Borders. It's in Santa Cruz, where I no longer live, and it's called Logos. The Borders moved in within a stone's throw, but obviously was defeated.

Sadly, I can think of few other examples. Location, location, location...

Re:Too soon (1)

kannibal_klown (531544) | about 9 months ago | (#45412775)

I liked the Borders store *by me* more than the Barnes and Noble stores *by me*

They were better lit, organized better, and the shelves were maybe 1-row shorter so it didn't feel as claustrophobic in there. The layout was also a little nicer and more casual than the B&N near me. They usually had what I was looking for: tech books, books to help out in college courses, classic lit, sci-fi, fantasy, new, old. My tastes aren't that obscure.

That being said, at some point the B&N near me remodeled and looks / feels a lot nicer than it used; I actually enjoy sitting in there and flipping through some books. So I don't miss Borders much anymore.

But for a while there I preferred to do my browsing and shopping at either online at Amazon or in person at Borders.

Alaska will still have stores (1)

landofcleve (1959610) | about 9 months ago | (#45411975)

You Google it, like subby could have before making such claims.

Best Buy (4, Informative)

Danathar (267989) | about 9 months ago | (#45411983)

It's not dead yet.

http://blogs.wsj.com/moneybeat/2013/11/11/best-buy-sp-500s-best-performer-getting-still-more-praise/ [wsj.com]

They are not out of the woods, but things like price matching amazon have helped a lot. I've personally not bought from Best Buy in a long time, but recently after buying something on Amazon I checked how much it would of cost at Best Buy and realized for a little more I could of had it that day for about the same price.

Polaroid? Borders? That's old news.

Re:Best Buy (1)

Anonymous Coward | about 9 months ago | (#45412033)

It's not dead yet.

It never was. The current trend in private equity is to collude with management of public companies like Netflix, Best Buy, JC Penney and Dell: run the business into the ground and then take it private. It almost worked for Best Buy and Netflix but management couldn't take it private quickly enough and the stocks recovered spectacularly. Dell is out and JC Penney looks to be well on its way. Both of these companies will be vastly profitable for the private equity that buys them.

Re:Best Buy (0)

Anonymous Coward | about 9 months ago | (#45412173)

Dell was pulled private by the founder. I'm actually bullish on Dell until such time as Michael sells it to someone else or chokes to death on a pretzel or something. People on Wall Street underrate the importance of the founder still being part of the company because they like the idea that managers are interchangeable, but in tech firms especially you can see how many of them start a nosedive right when the founder leaves or dies. The founder has a non-monetary incentive to have the company perform long term, and you can't easily fake that with monetary compensation.

JC Penney may well be screwed, though.

As for Netflix; if Blockbuster bought them out, they would have screwed it up, someone else would have done it right, and Blockbuster would still be going broke.

Re:Best Buy (0)

Anonymous Coward | about 9 months ago | (#45412253)

Both of these companies will be vastly profitable for the private equity that buys them.

Aaahhhhh, but .... they're profitable for private equity for other reasons other than their business operations - like taking on obscene amounts of debt and using it to themselves their management "fees". It's called a bust out in the mafia. (See ""Goodfellas"" and the part where Pauly takes over the restaurant and they burn it down later. Pauly made a fortune on the bankrupt restaurant/bar. Same thing with private equity only they don't literally burn down the place.)

It almost worked for Best Buy and Netflix but management couldn't take it private quickly enough and the stocks recovered spectacularly

That had nothing to do with the viability of the underlying business operations: it was all speculation on Wall Street. They were hoping for a blow-out buyout price.

Re:Best Buy (1)

Lumpy (12016) | about 9 months ago | (#45412105)

I have been in Best buy 3 times in the past year, and each time was to look at an item, I left without buying it because their prices are too high and I don't like getting assaulted by know nothing sales people. Then they have the fricking Dish network people in store that pressure sell you about their crappy service.

So I looked at the item and bought it on newEgg from my phone on the way out of the store.

Re:Best Buy (1)

Danathar (267989) | about 9 months ago | (#45412181)

did you ask if they would match the newegg price?

Re:Best Buy (1)

oodaloop (1229816) | about 9 months ago | (#45412249)

I was the same way. But this last time, I bought a Samsung Galaxy Tab 3 7.0. I checked the price on Amazon while in the store, and it was the exactly the same with no shipping. Granted, I paid sales tax in Best Buy, but it sounds like pretty soon we'll be paying sales tax on Amazon too. The accessories, OTOH, were hideously overpriced, so I went home and ordered on Amazon.

Re:Best Buy (0)

Anonymous Coward | about 9 months ago | (#45412335)

I don't like getting assaulted by know nothing sales people

Least you could find people to help. The ones at my best buy are racist and do not like helping whitey (seen it in action at least 3 times). Had one turn off the 'you can check out here light' then when 3 blacks showed up the light went back on.

That and they have devoted nearly 1/4th of their sq footage for cell phones. I am sure that is awesome for sprint, at&t, verizion, and t-mobile. Not so much for me looking for boxed software or music or movies... All of which I can *easy* get on the internet. I rarely need a new cell phone. When I do I usually get a better deal out of the carrier websites...

The last thing keeping me out of the store? No PC software. Oh they have tons of square footage selling you computers. But no software. Walmart has a better selection... I am funny like that I still want to 'own' my software.

It is like they are doing the exact opposite to bring people in. Bringing in 1 time customers is boring. The guy you want is the one who goes every week... They are selling expensive razors and not bothering to sell the razor blades... Instead of making the razor blades more interesting to buy they make them harder to find and raised the prices to boot. Their music selection is pathetic and wildly overpriced compared to itunes/amazon.

Those 3 things are what keeps me out of their stores. I used to drop 10-20k a year. Now I think I used half of a 50 dollar gift card someone gave me.

Amazon is my goto store for all of this stuff now.

Re:Best Buy (1)

RoTNCoRE (744518) | about 9 months ago | (#45412553)

But for how long? Technology retailers and manufacturers have a huge money sink in the inventory required to support brick and mortar retail operations. One store sells out, another has 10 units that they can't move for whatever reason (demographics, poor location, the minimum wage employee couldn't be bothered to find it etc.). Amazon can consolidate all the supply in their warehouses, cross ship between them for little cost based on economies of scale in shipping, and all the inventory is available to all customers. Couple that with the fast life cycle of tech - laptops as an example are 3 lines annually - and consider that all the unsold stock needs to be cleared out. Discounts are challenged by the same inefficiencies in retail, BB and their ilk need to discount deeper to sell the outgoing stock to counter the inefficiencies, and further discount demo models and pay for signage changes, etc.

This is exactly why you are seeing manufacturers opening branded showroom stores - Apple, Microsoft, Sony, (Tesla in the car world) - because they can execute better than the traditional retailers/dealers, and most often aren't willing to invest in the same caliber of displays in stores like BB where they don't have full control. The retailers can't, because the margins are too tight. The multi-brand house bricks and mortar retailer for tech is being squeezed out as the middle man - matching Amazon pricing they will be losing money from all the background costs. Unless they can sell enough warranty extensions to cover the difference, they are circling the drain - and Apple squeezed them out there too!

Re:Best Buy (1)

Anonymous Coward | about 9 months ago | (#45412735)

The real problem with price matching is that Best Buy, despite their claims, won't actually do it.

You go to Best Buy and find a TV you want to buy. It's $800. It's model number 12345B. Then you look on Amazon, and find what appears to be the same TV for $650. It's model number 12345A. The difference between them is that one of them has a red power LED, and the other one has a blue power LED. Best Buy will not price-match. The model numbers are different, and there are physical differences between the products. <sarcasm>One of them is clearly worth $150 more than the other.</sarcasm>

But you'll never win, because Best Buy demands unique, exclusive model numbers from the manufacturers. They never sell the same product anyone else does. This is standard practice for appliances and large electronics.

That means that the only thing Best Buy is going to match Amazon's price on is the small commodity stuff that they were already pretty much competitive on anyway (because it's available across the street at Wal-Mart, too). At best, you can get a few bucks off of the latest frat-game du jour (Madden, CoD, Battlefield, Halo, whatever) when someone runs a sale.

Easily applied to any new/old tech pair (4, Insightful)

JoeMerchant (803320) | about 9 months ago | (#45412005)

How could Blockbuster have eaten Netflix's Breakfast, Lunch, and Dinner? Easy: take all the same risks Netflix took, invest more capital (which Blockbuster had at the time), and abandon their proven business models earlier than they did.

The buggy whip makers could have beaten AC/Delco to the punch if they only followed this same crystal ball strategy.

What everybody forgets is: Pets.com et. al. Sure, they look silly today, but there was a time that they attracted investment dollars that Netflix didn't get.

Re:Easily applied to any new/old tech pair (1)

drinkypoo (153816) | about 9 months ago | (#45412177)

What everybody forgets is that these changes usually are obvious, but most people willfully ignore them.

When cars showed up, it should have been obvious that buggy whips were going away. Likewise, when streaming video became a ubiquitous thing, it should have been obvious that video disc rental was going away. The whole DVD-by-mail thing was just Netflix figuring out how to profit from its death throes.

Re:Easily applied to any new/old tech pair (3, Insightful)

JoeMerchant (803320) | about 9 months ago | (#45412339)

But it's not entirely clear when streaming will "take off," speaking from 2005 perspective - is the bandwidth there? will regulation step in and make Netflix pay for their inordinate use of the backbone? (still unknown), what devices will people consume media on? will Netflix be able to get their red button on enough remote controls? Most of these things are clear now, but were not so clear 8 ot 10 years ago.

Those newfangled cars, where are you going to fill them up with petrol? There's grass to eat clear from New York City all the way to San Francisco, and if you need to bale up some hay to cross the mountains, you can do that easy enough on the prarie for free...

Going, going, not quite gone (2)

tepples (727027) | about 9 months ago | (#45412361)

Likewise, when streaming video became a ubiquitous thing, it should have been obvious that video disc rental was going away.

Going away, not quite gone away. Streaming releases on Netflix, as I understand it, happen several months after the DVD release. Streaming is still impractical among people who can't yet move out of an area where nobody offers cable or fiber Internet. And how well is streaming doing in Europe and Australia/New Zealand, which have fewer potential customers per country and per language market than anglophone North America?

Re:Easily applied to any new/old tech pair (0)

Anonymous Coward | about 9 months ago | (#45412391)

What everybody forgets is that these changes usually are obvious, but most people willfully ignore them.

When cars showed up, it should have been obvious that buggy whips were going away. Likewise, when streaming video became a ubiquitous thing, it should have been obvious that video disc rental was going away. The whole DVD-by-mail thing was just Netflix figuring out how to profit from its death throes.

Every successful strategy is obvious in hindsight.

If you think they're obvious beforehand, I challenge you to go find the next obvious success and buy up shares. You'll make a killing.

Best Buy (2)

TWX (665546) | about 9 months ago | (#45412009)

"I'm not dead."

"What?"

"Nothing. There's your ninepence."

"I'm not dead."

"'Ere, he says he's not dead."

"Yes he is."

"I'm not."

"He isn't."

"Well, he will be soon, he's very ill."

"I'm getting better."

"No you're not, you'll be stone dead in a moment."

...

"I feel fine!"

Re:Best Buy (0)

bmorency (1221186) | about 9 months ago | (#45412661)

This reminds me of an old Monty Python clip where a couple guys are pushing a cart and asking people to bring out their dead. A guy comes out and is carrying a guy on his shoulder and says this guy is dead but the guy on his should replied I am not dead. http://www.youtube.com/watch?v=dGFXGwHsD_A [youtube.com]

BestBuy? (0)

Anonymous Coward | about 9 months ago | (#45412013)

Interesting that BestBuy is included on that list as they're "not dead yet".

Granted, they've been showing losses for some time now, but it seems every Christmas season, when I walk into Best Buy, that place is packed.

As for the others:
Polaroid - Had a niche that even other camera makers didn't fill. How were they supposed to adapt? Put a little printer in each machine? Their tech was an oddity when it existed and most people used normal film for their pictures (Kodak would've been a much better entry on this list).

Borders - Borders died because we live in a world where Amazon exists. If I can go into a book store and buy a book at cover price or I can wait a few days for the book to arrive, but at half-price, I'm going to get the book the slow way. Reading is not exactly a lightning fast activity anyway. And when you actually want to go to a store, you've also got Barnes and Nobles which caters to the "sitting around all day" crowd.

Blockbuster - Yeah. Not really sure what they could have done. Personally, I don't "get" the benefits of NetFlix. I can wait days to get a movie delivered to me or I can go to a physical building and see if there's something that I want to see. Unlimited streaming is where NetFlix had the advantage and I suppose that would've been something that Blockbuster could've gotten from acquiring NetFlix... but then, who's to say that would've happened anyway.

Re:BestBuy? (1)

gl4ss (559668) | about 9 months ago | (#45412383)

about polaroid....

fuji still makes a bundle selling instax. seen it in shops in the past year(in asia, in eu had to order from ebay).

(my sister wanted an instant camera for her wedding.. so bought the instax, since per picture cost with it was much much more sensible than what the cost would have been with the repro polaroids).

fond memories, LOL (0)

Anonymous Coward | about 9 months ago | (#45412017)

crazy late fees for one.

but let's dive in here... if blockbuster had bought netflix, we don't know that it would be the awesome thing it is today. Imagine if Yahoo! had bought it. it'd probably be dead by now. Same thing holds true with Blockbuster, it could very well have died because blockbuster bought it.

Blockbuster always sucked. (1)

PvtVoid (1252388) | about 9 months ago | (#45412031)

It was Mom-n-Pop video stores that were the shiznit, The king of them all was Kim's Mediapolis in Morningside Heights in NYC, which arranged films by director. Blockbuster was never more than an annoying lowest-common-denominator experience designed by mediocre MBAs. May they rot in hell.

Re:Blockbuster always sucked. (0)

Anonymous Coward | about 9 months ago | (#45412203)

save us from the ghosts of hipster past

Comcast, ATT&T, Wells Fargo, U.S. Congress (1)

Bob_Who (926234) | about 9 months ago | (#45412043)

....Just wishful thinking. I can't wait...

Blockbuster would have dragged them down (5, Insightful)

TechHSV (864317) | about 9 months ago | (#45412055)

If Blockbuster had purchased them, they never would have made the leap to delivering over the Internet.

Re:Blockbuster would have dragged them down (0)

Anonymous Coward | about 9 months ago | (#45412465)

Maybe not. If Blockbuster was smart enough to recognize Netflix as the future then they would probably be smart enough to recognize Internet delivery as the next step. As we know now, Blockbuster was not that smart so didn't take any steps.

Re:Blockbuster would have dragged them down (1)

PseudoCoder (1642383) | about 9 months ago | (#45412599)

Yes, they would have. Maybe not in the same fashion, but Blockbuster was one of the companies that was in bed with Enron when Enron was getting into the broadband bandwidth trading business. Interesting that both are now history.

http://www.forbes.com/2000/07/20/mu4.html [forbes.com]

Ignorance is bliss (1)

Anonymous Coward | about 9 months ago | (#45412057)

Your age probably determines whether you think of Blockbuster Video as a fond memory or a dinosaur predestined for extinction

Does it? Does it really, schnell?

You must live in a very simple world where everyone 30 and up are useless has-beens who should just hurry up and die while the teens are the master race of digital natives. I wish my world was quite that simple.

This type of drek belongs on reddit.

Blockbuster failure sits at the CEO's feet (4, Informative)

Lumpy (12016) | about 9 months ago | (#45412077)

They could have killed/bought redbox and netflix easily. But the Executives at Blockbuster are still too stupid to realize that they had to change models. I guarantee they still deny they did anything wrong.

If you are only looking at next quarter, then as an executive you are a complete and utter moron.

Blockbuster died... (4, Informative)

Bartles (1198017) | about 9 months ago | (#45412101)

...for me when they claimed they could not stop the computer from charging a fine to my credit card when I returned a movie 2 hours late. I cut my BB card in half in front of the cashier. Circa 2002.

Re:Blockbuster died... (0)

Anonymous Coward | about 9 months ago | (#45412389)

I cut my BB card in half in front of the cashier. Circa 2002.

That's like stomping on your McRib in front of the McDonald's cashier. Like they give a shit.

Re:Blockbuster died... (0)

Anonymous Coward | about 9 months ago | (#45412565)

Yeah, if you can't see why that's a worthless analogy then I pity you.

Re:Blockbuster died... (1)

wezeldog (982156) | about 9 months ago | (#45412585)

Except now Blockbuster is gone, so not like stomping on a McRib. The difference being that everyone loves McRibs. No one misses BB, except the people that lost their livelihood. So, I guess if they were still around, they could give a shit?

Re:Blockbuster died... (0)

Anonymous Coward | about 9 months ago | (#45412653)

It is funny how few cuts it actually takes to kill a big business.
It is the only real power you have.

Medical (0)

Anonymous Coward | about 9 months ago | (#45412109)

I wish the entire medical industry would go to the ash heap.

The pricing is obfuscated which makes it impossible for a consumer to make informed decisions.

I think it should be more like how Dentists operate. You walk into a dentist, they exactly what the insurance will pay for and how much will be out of pocket - AND they give you a figure.

And I think it would help for people to see how much their lifestyle is costing them. Smoker? Drunk? Obese? Eat fast food ten times a week?

Or when my grandfather was in the hospital - my 92 year old grandfather - they were treating him left and right and pulled hundreds of thousands of dollars in revenues. He died six months later of something completely unrelated - and another few hundred thousand dollars in revenues for the hospital, labs and doctors.

I think we as a society need to realize that we're mortal and there's a time when enough is enough. I'm trying to find the graph that shows 90% of our healthcare expenses are incurred during our last month of life and if you're on Medicare, guess who picks that up.

Blockbuster failed like Sears (1)

Eristone (146133) | about 9 months ago | (#45412135)

Blockbuster fell into the same myopic hole as Sears did in the 90s. At the start of the Internet boom, Sears had everything in place to be what Amazon is - they already had a full catalog service that delivered by mail and also had in-store pickup. A simple "order from" website would have been all that was needed as the rest of the infrastructure was already in place. Instead, Amazon owned that space and Sears is struggling to remain relevant.

Re:Blockbuster failed like Sears (0)

Anonymous Coward | about 9 months ago | (#45412467)

It is pretty mind-boggling that a company whose entire existence was based on mail-order catalogs could fail to be the bell-cow in online fullfillment.

borders is already dead (0)

Anonymous Coward | about 9 months ago | (#45412139)

I bought a bunch of stuff when it was 70% off

I won't miss Best Buy much. Polaroid has a future, have you seen their tablets?

Re:borders is already dead (1)

Shadowmist (57488) | about 9 months ago | (#45412201)

I bought a bunch of stuff when it was 70% off

I won't miss Best Buy much. Polaroid has a future, have you seen their tablets?

The company that Ed Land created ceased to exist years ago. The only thing of i that remains is the brand name, just like Commedore. Speaking of which the latest holder of that, Commedore USA purveyer of curren tech in redressed old boxes seems to have gone dark.

Re:borders is already dead (0)

Anonymous Coward | about 9 months ago | (#45412381)

Ah yes, I remember my Commedore Amigo. I had it plugged into my Panaphonic TV.

What I think of Blockbuster? (0)

Anonymous Coward | about 9 months ago | (#45412161)

I see Blockbuster as the company the pushed out the mom/pop video rental stores and made many grocery stores stop renting videos and charged me more money in the process. What does that say about my age? Well at least we came full circle and can now rent videos at the grocery store again, albeit from a big red kiosk outside the grocery store.

Disaster (2)

MyLongNickName (822545) | about 9 months ago | (#45412179)

Folks automatically assume that if Blockbuster bought Netflix that Blockbuster would be sitting on top of the streaming video world. More likely Blockbuster would have either killed the business either intentionally or through incompetence. When you have an entrenched management team that only understands one way of doing business and whose careers are based on a traditional distribution model, you will find that they don't adapt well to a new distribution model. My bet is that a new competitor would have eaten Blockbuster/Netflix' lunch.

Odds are Blockbuster was better off not making the purchase.

Game Stores (3)

Phoenix666 (184391) | about 9 months ago | (#45412261)

The next retail model to go belly up are GameStops and the like. When Steam is fully up and running there will be no reason to buy your own copy any more, which means the lucrative secondary market many game stores rely on for profit margins will go away.

Incidentally when Steam is fully transitioned to Linux it will have an effect on prevalence of MS in the home, too.

Re:Game Stores (1, Troll)

east coast (590680) | about 9 months ago | (#45412409)

Steam has been up and running for years...

Oh, I see the problem...

Incidentally when Steam is fully transitioned to Linux it will have an effect on prevalence of MS in the home, too.

You're living in a fantasy land.

Re:Game Stores (1)

spire3661 (1038968) | about 9 months ago | (#45412569)

IN a fully realized system, you will have one big Steam Machine running Win/Mac/Linux and little linux based streamers to each TV.

Re:Game Stores (0)

Anonymous Coward | about 9 months ago | (#45412611)

Yea who wants to own stuff. Go DRM!

More insight from the Slashdrones? (-1)

Anonymous Coward | about 9 months ago | (#45412311)

As I recall there was a lot of talk about how Netflix was a failed model years ago from the same people who'll probably be hawking on that BlockBuster was shortsighted...
 
As usual, Slashdotters act like they knew the future all along as they sit in their mother's basement eating the pizza that they didn't deliver last night while the ex-movers-and-shakers of Blockbuster are flying off to their own private islands in the Caribbean to sip on 20 dollar martinis while perched on the deck of their multimillion dollar yachts.
 
But, hey, I guess the peanut gallery here could have done it if they really wanted to, right? You know, after the next raid on Unrest or the next round of Counterstrike?
 
Your insight isn't for crap if you're not moving on it. Given the climate here I think that kind of laziness is actually saving a lot of people some serious heartache.
 
At least I'll be honest enough to say that I don't have such clear "foresight" into these matters.

Re:More insight from the Slashdrones? (1)

EvanTaylor (532101) | about 9 months ago | (#45412545)

Not participating in a change directly does not preclude one from anticipating its inevitability.

Old "failed to take seriously" argument (5, Insightful)

T.E.D. (34228) | about 9 months ago | (#45412349)

I hear this argument every time for companies that fail to shift to a new market reality. Examples are Xerox (with their PARC stuff), Polariod, Blackberry, IBM back in the day, record companies, etc. That's a complete misreading of the issue. It isn't about having some misguided sense of humor, its about fear.

The problem entrenched companies have is that while they have a market that they dominate that is acting as the company gravy-train, all the incentives in the world are acting upon them to protect that gravy train. This works well for them with normal competitors, but if someone finds a way to undermine the entire system (eg: online distribution for music), no matter how inevitable the coming change may be, it is a direct attack on their gravy train, and they will attack it back. If they tried to do the same thing themselves, at best they'd only cannibalize their own sales. What good is that?

Yes, it may be short-sighted. But we are a short-sighted species. A company's employees don't take their salary "in the long run", and their families don't eat "in the long run" either.

Best Buy is still around, unlike Circuit City (1)

neo-mkrey (948389) | about 9 months ago | (#45412473)

Divx was the beginning of the end for CC.

Re:Best Buy is still around, unlike Circuit City (1)

spire3661 (1038968) | about 9 months ago | (#45412583)

Getting rid of their commissioned sales force is what killed them.

Re:Best Buy is still around, unlike Circuit City (1)

CCarrot (1562079) | about 9 months ago | (#45412623)

Divx was the beginning of the end for CC.

Hmm, funny. Both are still going strong up here in the great white north...if you catch them on sales they're actually both pretty competitive.

My last laptop was purchased at Best Buy, and my friend's laptop came from Circuit City (aka Radio Shack) last year. And Circuit City does have slightly different stock than do the big twins (Best Buy and Future Shop), so if you're looking for a specific model, it's definitely worth checking out.

Netflix didn't kill blockbuster (1)

Stan92057 (737634) | about 9 months ago | (#45412477)

Netflix didn't kill blockbuster, broadband cable internet did. Cable internet was the death nail for AOL too and all dialup ISPs.

Then again, who cares? (1)

timeOday (582209) | about 9 months ago | (#45412479)

The premise of this story is that Netflix could have been bought by Blockbuster, and that Blockbuster would then have operated Netflix pretty much as it is operating now. Under this assumption of more dynamic Blockbuster management, they would have been shutting down the retail stores about now anyways, since they are not profitable any more.

In other words, the world would be just like it is now, but with a different brand name on a website. No more or less movies would be available to consumer, and there would be no more or less net jobs.

I can't think of one meaningful thing it would have actually changed.

Re:Then again, who cares? (1)

jythie (914043) | about 9 months ago | (#45412551)

Actually, it probably would have killed Netflix.

While people like to focus on Blockbuster's strategic decisions, they tend to do this from a bit of a tech fetish perspective and forget that retail rental was pretty profitable until pretty reciently. What really killed Blockbuster was being spun off from its parent company with around a billion dollars in someone else's debt, which meant much of its profits went into loan payments.

Sadly, if your lawyer is good, it is perfectly legal to buy a company, take a loan out, keep the money, transfer the loan to the company, then spin them back off. That is what killed Blockbuster and if they had bought Netflix they probably would have crippled them.

Walmart is next (2)

RevWaldo (1186281) | about 9 months ago | (#45412573)

No, I don't know how. But then again, neither do they. They won't even see it coming.

.

It's business (1)

countach44 (790998) | about 9 months ago | (#45412591)

"Your age probably determines whether you think of Blockbuster Video as a fond memory or a dinosaur predestined for extinction."

How about neither? When they came into town, the locally owned ma & pop video rental that had been around since the dawn of home video rentals closed almost immediately.

Best Buy isn't Going Away (4, Interesting)

Kagato (116051) | about 9 months ago | (#45412723)

Best Buy got rid of the C level staff that were associated with the old CEO/founder. The new CEO made a number of hard choices and focused on the fundamentals. That has lead to a significant recovery. The stock price has more than tripled and they are one of the best performing companies on the S&P500 right now.

Major point, the online pick-up is now part of check out area and not customer service. For years I hated using online pick-up because without fail I would be stuck waiting behind someone making the financial transaction of the century. I used to use Circuit City pick-up all the time because it was always ready when I got their. I found it less frustrating to use Amazon and wait the extra day instead of waiting in line. So it's a great change.

They making some good changes to the loyalty program. It's one of the easier ways of getting money back on purchasing rarely discounted Apple Hardware.

They got out of some really badly done deals internationally. The Cellphone Warehouse deal for UK expansion gave Cellphone Warehouse a cut of BB's US cell sales.

Certainly there is risk for them. If all the changes don't turn into great numbers for the holidays it could spell disaster. We'll know in a couple months.

Netflix didn't kill Blockbuster (0)

Anonymous Coward | about 9 months ago | (#45412739)

That is a common misconception. Blockbuster killed Blockbuster. Their movie rental prices were too high, the late fees were atrocious, their game rental prices skyrocketed...if Blockbuster had fair prices, pushed their used movie/game sales harder after they weren't as popular, and didn't pillage their customers on late fees, they would have been fine.

Netflix nor Redbox has the movie selection Blockbuster did, nor do they have the massive video game selection. People only went to those options because they were so much cheaper than what Blockbuster was offering. Blockbuster was too greedy and they killed themselves.

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