Tuesday, April 26, 2005

Blockbusted by New Technology

Blockbuster has consolidated a huge portion of the video, DVD, and gam rental business. They have taken control of most of the neighborhood business in the country. Who could compete with them?

... Technology competes with them every day. Why should a customer drive to the Blockbuster store and search the shelves for a specific movie, only to discover that the 10 copies owned by the store are rented out and the customer has to take the "The Land Before Time XXXI"?

A movie is a piece of information just like a document, photo, or music file. Broadband Internet into the home will do to movie sales and rentals what Napster and MP3's have done to the music industry.

Defending Blockbuster's business required mastering new technology and escaping from the old mindset that the movie is the DVD.

Broadband + Encryption + Digital Rights + Set-to-device = access to every movie ever made.

Who is a great competitor in this space? Tivo.

There is no reason the Tivo device and service have to be limited to programmed television. Imagine a library of encrypted digital movies that Tivo can stream into your home when you want them - not when Blockbuster decides that they will let you have one of their rare DVD's.

Web Reference: The Turning Point for Blockbuster - CFO Magazine - April Issue 2005 - CFO.com


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