The Fall of Blockbuster

The Fall of Blockbuster Video

Name

Wilmington University

Abstract

In 1985 Blockbuster was founded by David Cook decided to go into the movie rental business. He opened his first store opened in Dallas, Texas with more than 8,000 tapes in 6,500 titles. In 1997, Netflix a rent-by-mail service that allowed customers to rent DVDs that were mailed to their home. In 2004, Redbox offered movie rentals for a dollar per day through kiosk rental. The CEO James Keyes expressed that he was not worried about the growth of Netflix saying "I've been frankly confused by this fascination that everybody has with Netflix. Netflix doesn't really have or do anything that we can't or don't already do ourselves." After many failed attempts to branch out with other services Blockbuster files for bankruptcy and is purchased by Dish Network, only to close the remaining stores. If it wasn’t for denial and poor communication they might have been able to succeed and grow with technology.

It’s a Friday night and you really want to watch a movie, but don’t want to spend the extra money going to the movie theater. Perhaps you don’t have time to find a babysitter, or you just missed that window of opportunity to watch the movie in the movie theaters. On the way home you spot a Blue and Gold movie ticket sign offering video rentals for one night, it is the company that introduced Americans to stay-home movie nights, Blockbuster.

In 1985 Blockbuster was founded by David Cook when Cooks Data Services, an oil company, hit rough times and he decided to go into the movie rental business. The first store opened in Dallas, Texas with more than 8,000 tapes in 6,500 titles. When his movie rental business took off he changed the name to Blockbuster Entertainment (Marcus & Schaefer, 2011).

In early 1987, Cook sold a portion of the company to a group of investors that included Wayne Huizenga, a former Waste Management executive. Later that same year Cook left the company, leaving...