I have copied a fellow classmate blog post. Please respond to the post with a minimum of 200 words.
There is no industry that was affected more by technology than the video rental industry. Block Buster was the king of the industry for two decades! Today, just one store remains in Bend, Oregon (Olito, 2020). David Cook had an innovative idea and was able to offer more movies to his customer base. The company’s management failed to foresee the future a little over a decade later when the internet competitor Netflix and the pop-up kiosks like Red-Box entered the market. Blockbuster failed to recognize the future of the internet and refused to buy Netflix in 2000 for fifty million dollars (Olito, 2020). Blockbuster knew what the competitors ere doing, evident by the opportunity to buy Netflix, but failed to adapt to the imposing threats. Both Netflix and Redbox did not have the high overhead costs of many large brick and mortar locations. Blockbuster’s competitors were making decisions that translate their lower overhead costs into lower prices (Parnell, 2014).
Once Blockbuster acknowledged that the changes were inevitable they were already years behind their competition. What was a blown opportunity, by not purchasing Netflix, would cost them two hundred million dollars to start the venture to compete with the company they failed to purchase (Olito, 2020). The rise of streaming and online rentals forced Blockbuster into bankruptcy in 2010 and saw the closing of all but one store in 2013 (Olito,2020). There is no other industry in my opinion that has been affected by the internet than that of the movie rental industry.
As far as the future outlook goes, the internet movie streaming is taking on the physical movie theatres. With Disney releasing their movies on their platform for a premium, and other movies having exclusive releases on other platforms the physical theatres are struggling. Unless theatres find a way to supplement revenue, they may also become extinct. I am interested in seeing how the movie industry as a whole progresses.
References:
Olito, Frank (2020). The rise and fall of Blockbuster. Retrieved from: https://www.businessinsider.com/rise-and-fall-of-blockbuster
Parnell, J. (2014). The external environment: social and technological forces. In Strategic management (pp. 78-115). SAGE Publications, Ltd, https://www-doi-org.ezproxy.lsus.edu/10.4135/9781506374598.n4
