Of all the industries that have been hit hard by the digital revolution, the music/video industries are some of the hardest hit. With both formats relying heavily on physical media for income, now that many are pushing away from such formats, the companies involved are feeling the pinch. On the video front, Blockbuster is taking a beating. Just look at their recent 4th quarter results in which they lost over $400 million — $400 million!. Even more telling however is that this staggering loss comes at a time when Blockbuster has in years past done very well. Simply put, it’s a failure to adapt.
Adapt to the changing times, to the move to smaller and more efficient media, or just to digital altogether. Recent trials of SD movie rentals may have seemed pretty decent on paper, but in truth it’s a terrible idea. Who is going to drive into town to pick up a digital file when it’s exponentially easier and more convenient to just download it? That fact alone coupled with Blockbuster not really having any viable digital rental/purchase options are literally killing the company.
Blockbuster CEO Jim Keyes knows this, stating that though his “company’s future is bright, the next 12 to 18 months will remain challenging.” Looking at it from the outside, it’s going to be very challenging. Does anyone feel or think Blockbuster can right their sinking ship or is it too far gone to save?