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A Look Back at Why Blockbuster Really Failed and Why It Didn't Have To (2014)

forbes.com

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Re: A Look Back at Why Blockbuster Really Failed and Why It Didn't Have To (2014)

#3

Post by schnevets »

In the same year that Reed Hastings was laughed out of the conference room, Blockbuster announced a partnership with Enron for Videos on Demand. https://www.forbes.com/2000/07/20/mu4.html#545092873541

The partnership lasted a single year. I wonder which event happened first? If they met with Enron first, it seems the morale is to move fast and never underestimate what the future holds. If they met with Netflix first, I'd say it's don't be as skeptical to the big guys as you are to the startup.

Re: A Look Back at Why Blockbuster Really Failed and Why It Didn't Have To (2014)

#4

Post by forkLding »

Article is a bit vague and oversimplified. So Netflix won because of network effects? and Blockbuster didn't have network effects? Blockbuster is bigger than Netflix when Netflix was a startup and simple ripples in Blockbuster could have generated a much bigger effect than Netflix in terms of Facebook posts or Twitter messages.

Network effects don't happen because people want them to happen, network effects benefit in marketing is really just really good service that turns into lots of word-of-mouth that is spread super-fast throughout the internet whereas traditionally it would just spread in your traditional community. You can build for network effects but that doesn't mean you can get that effect.

Re: A Look Back at Why Blockbuster Really Failed and Why It Didn't Have To (2014)

#5

Post by pmoriarty »

Blockbuster used to have a really crappy selection of mostly mainstream movies, but often it was one of the closest video rental stores around, as they seemed to be everywhere. They also censored and cut their movies, which was really annoying. I don't know what their agenda was on that front, and why they couldn't just let mature adults watch the full films.

My friends and I used to much prefer going to independent video rental stores, which had a much better selection and did not cut or censor their films, but we'd often have to go pretty far to reach them.

Then Netflix DVD came around, and that had a pretty good selection.. maybe not as good as some of the best independent movie rental stores, but wider in some ways, and overall good enough so that the added convenience of getting DVDs delivered to my door and being able to return them by merely dropping them in the mailbox whenever I felt like it made me stick with Netflix and never step foot in a brick and mortar movie rental store again. I had meant to try Greencine, as it supposedly had an even better selection of obscure movies, but I never got around to it, and then it went out of business.

Then came Netflix streaming, with a crappy selection comparable to the crappy selection Blockbuster had in the bad old days.

I've stayed with Netflix DVD service because of their far better selection, but most people these days don't seem to know that Netflix even has a DVD service (not very surprising as Netflix doesn't even advertise its presence on netflix.com and you have to go to dvd.netflix.com to reach it).

Many of them rarely realize how crappy the selection of Netflix streaming is, as they've been brought up on a diet of crap, and are only vaguely aware that there's a whole world of fantastic movies out there beyond Hollywood blockbusters and TV shows.

Re: A Look Back at Why Blockbuster Really Failed and Why It Didn't Have To (2014)

#8

Post by ghaff »

pmoriarty wrote: post #5

Blockbuster used to have a really crappy selection of mostly mainstream movies, but often it was one of the closest video rental stores around, as they seemed to be everywhere. They also censored and cut their movies, which was really annoying. I don't know what their agenda was on that front, and why they couldn't just let mature adults watch the full films. My friends and I used to much prefer going to independent…

Unfortunately, Netflix' DVD strategy seems to be to let the back catalog more or less literally rot away. More and more films aren't available at all or have very long waits.

In all fairness, a lot of movies are available to rent digitally on Amazon. I suspect a lot of people supplement Netflix' crappy movie streaming offerings with purchases/rentals on Amazon or Apple. (Or Redbox for recent films.)

But, yeah, I've definitely had people look at me funny when I admit to still having a Netflix DVD subscription and even buying a DVD once in a while.

Re: A Look Back at Why Blockbuster Really Failed and Why It Didn't Have To (2014)

#9

Post by beamatronic »

Animats wrote: post #2

The author harps on "networks" too much. In general, brick and mortar retail sectors which can be done better on line have tanked. From Sears to Radio Shack to Toys-R-Us, that's happened. Malls in general are hurting badly.

Oddly one of the big San Jose malls (Valley Fair) is currently undergoing a huge renovation and expansion.

Re: A Look Back at Why Blockbuster Really Failed and Why It Didn't Have To (2014)

#10

Post by ghaff »

forkLding wrote: post #4

Article is a bit vague and oversimplified. So Netflix won because of network effects? and Blockbuster didn't have network effects? Blockbuster is bigger than Netflix when Netflix was a startup and simple ripples in Blockbuster could have generated a much bigger effect than Netflix in terms of Facebook posts or Twitter messages. Network effects don't happen because people want them to happen, network effects benefit i…

There are different network effects/economies of scale that end up getting conflated.

There are often benefits to size like brand recognition, better pricing from suppliers, amortization of R&D, etc. Apple is a poster child.

There are network effects where having more users actually helps to make a better product through increased data etc. (This is increasingly true with products that rely on ML and large data sets in various ways.)

And then there are the eBay-type (or telephone system historically) network effects. If your auction site only has a handful of sellers (or a handful of buyers), it's more or less useless no matter how wonderful it is by other metrics.

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