Why Blockbuster Has Gone Bust
In the Perth suburb Morley, the second to last Blockbuster store in the world has just closed its doors. Now, there is just one Blockbuster standing in Bend, Oregon in the United States.
While Blockbuster has had over 9,000 stores during its prime, popular stream services such as Netflix and Hulu have dismantled and disrupted the business of home video rental stores. Not only did Blockbuster suffer, but as of 2016 in the United States, eight-six percent of the 15,300 at home video rental stores have since closed.
While Netflix is the powerhouse it is today — with 139 million subscribers across the globe as of January 2019 — Blockbuster actually once had the opportunity to purchase the company from Netflix CEO Reed Hastings in the early 2000s for 50 million dollars. Instead, Netflix has seen its company worth reach 159.9 billion dollars as of March 2019, while Blockbuster had to file for bankruptcy protection in the United States in 2010.
So what happened to Blockbuster?
Simply put, they never understood how the internet could play a factor in renting and producing movies and shows. Netflix, Hulu, and Amazon have all found success in not only providing content to their subscribers, but also producing original content as well. In 2018, Netflix spent 8 billion dollars on original content including TV shows and films with around 1,000 originals produced on their platform. In particular, more than 90 percent of their subscribers watch Netflix original content, which includes shows such as Orange Is The New Black, House of Cards, and Ozark.
Netflix has been utilizing their revenue by hiring award-winning filmmakers to produce original content. “Roma”, directed by Academy Award winner Alfonso Cuarón, was released on Netflix and recently won 3 Academy Awards, including Best Foreign Language Film. Along with Cuarón, Academy Award winners such as the Coen brothers, Martin Scorsese, and Steven Soderbergh have worked with Netflix to release movies as well. Netflix isn’t scared to spend money either to compete with Hollywood; for example, they provided Scorsese with a budget of 140 million dollars for his upcoming movie “The Irishman”, which will be his most expensive movie to date.
But, we can all take a trip down memory lane reminiscing about all of the memories we have parading down the aisles of Blockbuster, nagging our parents about which DVDs we could or couldn’t rent. All of the nights we arrived at the store front to glimpse at the gigantic yellow letters of ‘Blockbuster’ with the fluorescent bright blue background are memories that are forever ingrained in our heads.
However, film culture is still rapidly changing as movie theatres are now experiencing a decline in attendance, as 2017 was the lowest it has ever been in the past twenty four years. Movie tickets are becoming expensive and with streaming services expanding at the rate they are, more people will decide to wait till their favorite movies are available to them at home — rather than burn a hole in their wallet heading out to theatres.
This begs the question: as a modern viewer, would you rather stay home for your film/TV fix or seek out the novelty of the cinema?'