What happened to Blockbuster?

Does the end of Blockbuster mark the end of something more?

CC photo courtesy of Tim@SW2008 on Flickr

CC photo courtesy of [email protected] on Flickr

On October 29th the DVD rental chain Blockbuster, along with high street shoe chain Barratts, both went into administration, putting thousands of jobs at risk before Christmas. Restructuring firm Moorfields Corporate Recovery has been appointed administrator of TS Operations, which trades as Blockbuster. This is the second time that Blockbuster has gone into administration and the third time for Barratts. Two high street chains falling into administration is a double blow to the struggling British high street, which has been in a sorry state for years now. The contrast in Blockbusters situation is staggering; it is only less than a decade since Blockbuster was a thriving retailer.

The end of all Blockbuster stores in the United States has already been announced, with all stores closing by the end of the year. On the 14th November it was announced that 72 of Blockbuster’s 264 UK stores will also close, with 452 jobs cut. Fittingly, the last movie rented from any of its stores was the film This Is The End.

However, unlike like many other high street chains which have struggled or even closed completely over the last few years, Blockbuster’s end is one many could predict with ease. The downfall of Blockbuster arguably began a decade ago with the rise of Netflix’s DVD-by-mail service, followed by the introduction of a subscription service that streams video over high-speed internet connections. Netflix’s provision of media via streaming offered a level of convenience to consumers that Blockbuster could not possibly equal.

Netflix is, however, merely a part of a technological and consumer transformation that gradually but inevitably undermined Blockbuster as a viable business. It is technology that has dealt the critical blow to Blockbuster, reshaping the film and DVD industry in a way and speed that Blockbuster could not adapt to. This is due to the nature of Blockbuster, as a film and video game rental store, which makes it vulnerable to changes in technology and shopping habits.

This technological transformation includes the development of the internet as a more convenient avenue for people to rent and purchase films and television programs, removing the need to travel to stores like Blockbuster. The online world is now driving a large amount of sales today, a trend that will almost certainly continue. Netflix, along with other internet film rental services like iTunes and Lovefilm, form part of this world. Blockbuster was simply overtaken by a move towards streaming and downloading videos online, unable to adapt or integrate into this. Blockbuster has failed to focus on the customer experience, stuck in a business format that belongs in the nineties, entrenched in the past.

At the time of writing, it appears likely that Blockbuster will continue to march on, probably in a different, and smaller, format. But two collapses into administration indicate that this once mighty retail chain is meeting the end of its life as a viable business. Blockbuster belongs to a different era of commerce, and far more viable retail chains have disappeared from British high streets in the last few years. The fact it has lasted this long in a rapidly transforming retail world is truly staggering, but its basic business format has been undone by technological and commercial change, leaving the chain at a dead end.


  1. I don’t even think it is so much Netflix or other services, it is just the internet in general.

    Why pay ridiculous prices to go out, get a film, watch it and bring it back before facing hefty fines when I can just google ‘watch [film] online.’

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  2. I am still the lizard king and still require blockbuster because the internet is a mystery to me!

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  3. Too many typos in this article. I hope no one got paid to write it.

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  4. It’s only logical that people who don’t have enough time to make choosing a film to watch an event, a special family activity are more comfortable with streaming. But there are still fans of doing it the way they used to years ago, and who have nice memories about it. There are other, smaller stores besides Blockbuster. I agree that it’s the Internet in general, not the movie streaming sites making the change. Life is getting more busy, so the Internet is offering us options of spending less time on certain activities, with online shopping, online movies and online communication, but if those are more enjoyable is a tricky question.

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  5. This second administration has seen the DVD Post service close, as well as the Warehouse/distribution in Milton Keynes. More shops (which stayed open 1st time) are now closing. (Abingdon in Oxfordshire has 3 days left!!). I wonder if this time it will be for good. May not see my membership transfer to another company…

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