Blockbuster has went bankrupt in US people in the industry keep saying that DVD-rental company just lost a competition to NetFlix. Who came into market with better business model of flat-fee unlimited rentals without due dates, late fees, shipping or handling fees, or per title rental fees.
Netflix is still on top of DVD-rental business in US and in October 2011 it announced it was announced that Netflix would be launching in the UK and Ireland in early 2012.
Netflix was officially launched as a streaming-only service in the United Kingdom and Ireland on January 9, 2012. On August 20, 2012 Netflix announced it had reached the one million member milestone in the UK and Ireland.
While Netflix is expanding Blockbuster keeps shutting it’s stores. But Netflix is not the only player on market and Blockbuster is loosing to all of its competitors.
People don’t want to go into a dodgy store in the next block, they want to get movies without going out there homes or even without getting up the sofa.
Blockbuster couldn’t keep up with people’s demand and that is one of the reasons of it’s failure. There can be distinguished three(legal) areas of competition for the company:
• In-store rentals and sales
• Online rentals
• Online viewing
Online rental by post has been the major winner, where in the US Netflix now has more than 10 million subscribers and Lovefilm in the UK now controls a greater share of the DVD rental market than Blockbuster with more than 1million people subscribing to their service.
Another major competition comes from video-on-demand service, which allows you to watch movies on your TV. Such companies as Sky, Virgin and BT control this sector.
In the end of 2010 4.3m British Households were equipped to receive true video-on-demand services via a TV-based set-top box.
And why would you go to Blockbuster when you can get your movies instantly without connecting your bank account to another membership?
If you will visit Blockbuster website you’ll find out that they do have a rent-by-post service, but the research has showed that most people are aware of such service of Lovefilm, but no one heard that Blockbuster does the same (even members and people who come there quite often).
University/College: University of Chicago
Type of paper: Thesis/Dissertation Chapter
Date: 24 December 2016
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