# Why wasn't Blockbuster prepared for online movie streaming? **URL:** \ **Category:** Factual Questions\ **Created:** [June 5, 2018, 3:54pm UTC](https://boards.straightdope.com/t/why-wasnt-blockbuster-prepared-for-online-movie-streaming/815470 "2018-06-05T15:54:41Z")\ **Posts on this page:** 20\ **Page:** 6
**Author:** ![TSBG](https://avatars.discourse-cdn.com/v4/letter/t/77aa72/32.png) [@TSBG](https://boards.straightdope.com/u/TSBG)\ **Post date:** [June 7, 2018, 2:59am UTC](https://boards.straightdope.com/t/why-wasnt-blockbuster-prepared-for-online-movie-streaming/815470/101 "2018-06-07T02:59:19Z")
I worked for AOL in 1994-1995. They were always promising streaming vide was around the corner but it wasn’t, except for postage-stamp-sized 10fps experiments. I assumed it would never happen. Imagine my surprise when years later I discovered YouTube. I knew then the jig was up for a lot of companies, including video stores; the dominoes are continuing to fall. However I am not smart or active enough to have profited off this insight. By the way, for those seeking streaming movies and TV shows, the app JustWatch is useful though not the final word on where you can find stuff. And for real classics, the Criterion Collection has moved around but is now available through a service called Filmstruck. ---
**Author:** ![Colophon](https://avatars.discourse-cdn.com/v4/letter/c/f05b48/32.png) [@Colophon](https://boards.straightdope.com/u/Colophon)\ **Post date:** [June 7, 2018, 7:39pm UTC](https://boards.straightdope.com/t/why-wasnt-blockbuster-prepared-for-online-movie-streaming/815470/102 "2018-06-07T19:39:34Z")
> [@dolphinboy](#): > > Kodak went down the same path at Blockbuster. They actually had a digital camera ready to go but wanted to keep their film business going as along as possible. They completely missed the boat on purpose. Not just “ready to go”, they sold them pretty early on. I had (still have, somewhere) a Kodak digital camera, which I won in a competition in about 2000. ---
**Author:** ![Tom\_Tildrum](https://avatars.discourse-cdn.com/v4/letter/t/e95f7d/32.png) [@Tom\_Tildrum](https://boards.straightdope.com/u/Tom_Tildrum)\ **Post date:** [June 7, 2018, 8:01pm UTC](https://boards.straightdope.com/t/why-wasnt-blockbuster-prepared-for-online-movie-streaming/815470/104 "2018-06-07T20:01:14Z")
> [@E-DUB](#): > > Tripolar mentioned Sears. With their history of the “Sears Catalog” making their customers used to ordering by mail, they could have been Amazon. Sears’ shift from a mail-order business to a network of physical stores in the early 20th century is one of the great examples of a corporation completely retooling its business model successfully. It just couldn’t reverse the process to compete with Amazon. ---
**Author:** ![Dewey\_Finn](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/dewey_finn/32/4222_2.png) [@Dewey\_Finn](https://boards.straightdope.com/u/Dewey_Finn)\ **Post date:** [June 7, 2018, 9:24pm UTC](https://boards.straightdope.com/t/why-wasnt-blockbuster-prepared-for-online-movie-streaming/815470/105 "2018-06-07T21:24:49Z")
> [@voltaire](#): > > The Kodak example of them shelving the first digital camera is true, but that was in the 1970’s, so it was quite premature then, since there were hardly any computers to make digital photography practical. And the quality was .01 megapixels, which is 10,000 pixels, which is 100x100 resolution - yeah, that belonged on the shelf. They came out with the DC-40 in 1995, which was ahead of quite a few of their competitors, and just about the right time for the market to start maturing. And in a partnership with Apple, it was also sold as the Apple Quicktake. > > In fact, my first digital camera, which was one whole megapixel, was a Kodak and although it was kind of ugly, it had nice features compared to everything else available at that price point. > > [Here’s Wiki’s take:](https://en.wikipedia.org/wiki/Kodak#Shift_to_digital) (bolding mine) > > - Although Kodak developed a digital camera in 1975, the first of its kind, the product was dropped for fear it would threaten Kodak’s photographic film business. **In the 1990s, Kodak planned a decade-long journey to move to digital technology.** CEO George M. C. Fisher reached out to Microsoft and other new consumer merchandisers. Apple’s pioneering QuickTake consumer digital cameras, introduced in 1994, had the Apple label but were produced by Kodak. The DC-20 and DC-25 launched in 1996. Overall, though, there was little implementation of the new digital strategy. Kodak’s core business faced no pressure from competing technologies, and as Kodak executives could not fathom a world without traditional film there was little incentive to deviate from that course. Consumers gradually switched to the digital offering from companies such as Sony. In 2001 film sales dropped, which was attributed by Kodak to the financial shocks caused by the September 11 attacks. Executives hoped that Kodak might be able to slow the shift to digital through aggressive marketing. > Under Daniel Carp, Fisher’s successor as CEO, Kodak made its move in the digital camera market, with its EasyShare family of digital cameras. Kodak spent tremendous resources studying customer behavior, finding out that women in particular loved taking digital photos but were frustrated in moving them to their computers. This key unmet consumer need became a major opportunity. Once Kodak got its product development machine started, it released a wide range of products which made it easy to share photos via PCs. One of their key innovations was a printer dock, where consumers could insert their cameras into this compact device, press a button, and watch their photos roll out. **By 2005, Kodak ranked No. 1 in the U.S. in digital camera sales that surged 40% to $5.7 billion.** > \*\* Despite the high growth, Kodak failed to anticipate how fast digital cameras became commodities, with low profit margins, as more companies entered the market in the mid-2000s. **In 2001 Kodak held the No. 2 spot in U.S. digital camera sales** (behind Sony) but it lost $60 on every camera sold, while there was also a dispute between employees from its digital and film divisions. The film business, where Kodak enjoyed high profit margins, fell 18% in 2005. The combination of these two factors resulted in disappointing profits overall. Its digital cameras soon became undercut by Asian competitors that could produce their offerings more cheaply. **Kodak had a 27% market-leading share in 1999, that dwindled to 15% by 2003. In 2007 Kodak was No. 4 in U.S. digital camera sales with a 9.6% share, and by 2010 it held 7% in seventh place behind Canon, Sony, Nikon and others, according to research firm IDC.** Also an ever-smaller percentage of digital pictures were being taken on dedicated digital cameras, being gradually displaced in the late 2000s by cameras on cellphones, smartphones, and tablets.\* > > So it wasn’t that they never tried, it was just that the new market disrupted things enough that they lost their advantage. One of the famous business school gurus has a theory about “core competencies” and how companies succeed when they stick to those things they’re good at. So, for example, Honda makes great cars, motorcycles, lawnmowers, etc. because their core competency is actually in making IC engines. So they’d be foolish to get into, say, making toaster ovens. Kodak’s core competency was in chemicals and film. (A Kodak spinoff called Eastman Chemical has 15,000 employees and $9.6 billion in revenues.) So when the market moved to digital cameras, the companies with consumer electronics expertise did better. ---
**Author:** ![filmore](https://avatars.discourse-cdn.com/v4/letter/f/7993a0/32.png) [@filmore](https://boards.straightdope.com/u/filmore)\ **Post date:** [June 8, 2018, 2:31pm UTC](https://boards.straightdope.com/t/why-wasnt-blockbuster-prepared-for-online-movie-streaming/815470/106 "2018-06-08T14:31:15Z")
How did streaming to the TV first come about? Was it with Roku boxes? That’s how I first watched streaming Netflix. What enticed manufactures to make standalone devices which could stream to the TV back when there wasn’t a lot of streaming demand? ---
**Author:** ![Pantastic](https://avatars.discourse-cdn.com/v4/letter/p/3bc359/32.png) [@Pantastic](https://boards.straightdope.com/u/Pantastic)\ **Post date:** [June 8, 2018, 2:42pm UTC](https://boards.straightdope.com/t/why-wasnt-blockbuster-prepared-for-online-movie-streaming/815470/107 "2018-06-08T14:42:26Z")
> [@filmore](#): > > How did streaming to the TV first come about? Was it with Roku boxes? That’s how I first watched streaming Netflix. What enticed manufactures to make standalone devices which could stream to the TV back when there wasn’t a lot of streaming demand? Streaming on TV first came from running computer output to TV, which was easy with HDMI TVs and wasn’t that uncommon with older interfaces. Then people started adding streaming apps to other devices that were already connected, like the PS3 which came out in 2006 (two years before Roku). ---
**Author:** ![Johnny\_Bravo](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/johnny_bravo/32/493_2.png) [@Johnny\_Bravo](https://boards.straightdope.com/u/Johnny_Bravo)\ **Post date:** [June 8, 2018, 2:43pm UTC](https://boards.straightdope.com/t/why-wasnt-blockbuster-prepared-for-online-movie-streaming/815470/108 "2018-06-08T14:43:16Z")
> [@filmore](#): > > How did streaming to the TV first come about? Was it with Roku boxes? That’s how I first watched streaming Netflix. What enticed manufactures to make standalone devices which could stream to the TV back when there wasn’t a lot of streaming demand? They started as audio only. Remember the early days of internet radio? You could get devices that would stream music to your television. Wikipedia says that was way back in [2000.](https://en.wikipedia.org/wiki/Digital_media_player) Netflix launched in 1997 but didn’t begin streaming until 2007, so digital media players had been around for a long time by that point. ---
**Author:** ![Wesley\_Clark](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/wesley_clark/32/20581_2.png) [@Wesley\_Clark](https://boards.straightdope.com/u/Wesley_Clark)\ **Post date:** [June 8, 2018, 2:48pm UTC](https://boards.straightdope.com/t/why-wasnt-blockbuster-prepared-for-online-movie-streaming/815470/109 "2018-06-08T14:48:17Z")
As someone who was there, here is my rememberance. At first, netflix streaming sucked (about 10 years ago). It was all foreign films and B movies and they were horrible. The real benefit of Netflix was that you could rent DVDs by mail. I forget when netflix stream became good enough to actually be worth it on its own, maybe 2010? Blockbuster did try to combat this issue by creating their own DVD by mail service, which had the added benefit of instead of mailing the DVDs back, you just took them into blockbuster and exchanged them for new movies. So I’d get 3 DVDs via mail from blockbuster, then after watching them I’d exchange them at the blockbuster for 3 physical DVDs. Then return those, then order 3 more by mail. It was actually a pretty nice system. I think this happened around ~2007 when this system was in place. But the online streaming catalogs kept getting better, and blockbuster never really took online streaming seriously and here we are. FWIW, Family Video is still doing great. There are tons of those still around. Redbox is also common. So the physical video store isn’t gone, because Family Video and Redbox are easy to find where I’m at. There are serious limitations to streaming. A lot of movies aren’t available, and it takes a while before new releases are affordable ($5 to stream a new movie vs $2 at redbox). Movie Gallery, Blockbuster and all the independent video stores are gone. But Family video and Redbox still exist. ---
**Author:** ![filmore](https://avatars.discourse-cdn.com/v4/letter/f/7993a0/32.png) [@filmore](https://boards.straightdope.com/u/filmore)\ **Post date:** [June 8, 2018, 3:16pm UTC](https://boards.straightdope.com/t/why-wasnt-blockbuster-prepared-for-online-movie-streaming/815470/110 "2018-06-08T15:16:39Z")
Actually, I think Tivo is how I first started streaming to the TV. I remember renting movies from Amazon. Back then, the movies were not streamed as you watched them. The whole movie was downloaded to the Tivo, and then you would watch from there. That was beneficial back when most internet was slower than today, but you might have to wait a while for enough of the movie to be downloaded before you could start watching. ---
**Author:** ![Jophiel](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/jophiel/32/66_2.png) [@Jophiel](https://boards.straightdope.com/u/Jophiel)\ **Post date:** [June 8, 2018, 3:26pm UTC](https://boards.straightdope.com/t/why-wasnt-blockbuster-prepared-for-online-movie-streaming/815470/111 "2018-06-08T15:26:33Z")
> [@Pantastic](#): > > Streaming on TV first came from running computer output to TV, which was easy with HDMI TVs and wasn’t that uncommon with older interfaces. Yeah, my old TV had a VGA port on it and an audio-in jack. So even without an HDMI connection, you could output video & sound to it and watch stuff from the couch on the “big screen” (well, bigger than my monitor at least). Of course, this required you to have a computer near the TV but early adoption isn’t always elegant. I suspect a number of techie-type movie fans were already connecting their computers to televisions and watching catalogs of downloaded/ripped movies so it was no great shakes to try streaming the same way. ---
**Author:** ![iamthewalrus\_3](https://avatars.discourse-cdn.com/v4/letter/i/258eb7/32.png) [@iamthewalrus\_3](https://boards.straightdope.com/u/iamthewalrus_3)\ **Post date:** [June 8, 2018, 4:31pm UTC](https://boards.straightdope.com/t/why-wasnt-blockbuster-prepared-for-online-movie-streaming/815470/112 "2018-06-08T16:31:56Z")
> [@Wesley\_Clark](#): > > At first, netflix streaming sucked (about 10 years ago). It was all foreign films and B movies and they were horrible. The real benefit of Netflix was that you could rent DVDs by mail. I forget when netflix stream became good enough to actually be worth it on its own, maybe 2010? It was in [2008, when Netflix made a 4-year deal with Starz to license their content for streaming.](https://www.digitaltrends.com/movies/starz-ceo-netflix-terrible/) It included 2,500 titles, more than twice what Netflix had at the time, and higher quality. Not all A-list first-run stuff, but enough that Netflix streaming was a real contender. Starz had streaming rights and no streaming service, so it made a few tens of millions off them. 3 years later, Netflix streaming subscribers were up by a factor of 2.5, and Starz turned down (estimated) 10x as much money to extend the agreement. So, they seriously underpriced it originally. Widely considered a major strategic blunder by Starz ---
**Author:** ![dalej42](https://avatars.discourse-cdn.com/v4/letter/d/67e7ee/32.png) [@dalej42](https://boards.straightdope.com/u/dalej42)\ **Post date:** [June 8, 2018, 7:18pm UTC](https://boards.straightdope.com/t/why-wasnt-blockbuster-prepared-for-online-movie-streaming/815470/113 "2018-06-08T19:18:12Z")
Since this thread has turned into mostly anecdotes, I’ll share mine. My first job was working at a small local video rental place, I worked there with another guy from high school. We both had a pretty decent knowledge of movies, far more than you’d expect from the average 18 year old. However, the manager decided that the best way to increase sales was to fire all the male employees and replace them with attractive women that couldn’t get hired at Hooters. I was so happy when that placed closed. I’m annoyed by Netflix’s turn towards streaming and ‘original content.’ I don’t have time to take on more TV series, there’s plenty of times I just want to watch a movie for 90 minutes or so. I don’t want to binge watch something with a weekend long time commitment. I still keep my subscription, but I seriously consider suspending it during summer when the weather is nice and I want to be outside. I use Redbox for new releases, there’s one across the street and I’d rather see a new release in blu ray quality. They’re always sending me promo codes, and I’m quite sure I couldn’t rent from Blockbuster for one US dollar, even in the 1990s. Amazon streaming works for most films, but I do miss the days of the Netflix DVD queue. Netflix hurt themselves by being so focused on throttling, and the elimination of Saturday service. Too bad, that could be a small, but profitable niche for them as I’d still rather watch a DVD than a streaming film. ---
**Author:** ![Voyager](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/voyager/32/133_2.png) [@Voyager](https://boards.straightdope.com/u/Voyager)\ **Post date:** [June 9, 2018, 12:06am UTC](https://boards.straightdope.com/t/why-wasnt-blockbuster-prepared-for-online-movie-streaming/815470/114 "2018-06-09T00:06:06Z")
> [@dalej42](#): > > Amazon streaming works for most films, but I do miss the days of the Netflix DVD queue. Netflix hurt themselves by being so focused on throttling, and the elimination of Saturday service. Too bad, that could be a small, but profitable niche for them as I’d still rather watch a DVD than a streaming film. Netflix still has a DVD queue. Few of the old movies I want to watch are on streaming, and I find that having the envelope there encourages me to spend the time to watch the movie. I don’t think Redbox or any streaming has the original 1922 Lost World - which is fantastic, by the way. ---
**Author:** ![nightshadea](https://avatars.discourse-cdn.com/v4/letter/n/7ba0ec/32.png) [@nightshadea](https://boards.straightdope.com/u/nightshadea)\ **Post date:** [June 9, 2018, 12:47am UTC](https://boards.straightdope.com/t/why-wasnt-blockbuster-prepared-for-online-movie-streaming/815470/115 "2018-06-09T00:47:15Z")
Also Netflix hit upon something at exactly the right time … The sudden nostalgia for TV shows …a lot of the TV shows that were on 24/7 weren’t on anymore and people missed them (I admit to binging the incredible hulk knight rider airwolf and the a team) Columbia house started it but huge DVD/vcr sets turned people off and like described above even getting them through the DVD service was a crapshoot Then Netflix picked them up cheap and started the whole seasons/series of TV shows which is what 75-90 % of people watch Netflix for I think if they hadn’t hit upon that streaming would still be a niche thing ---
**Author:** ![nearwildheaven](https://avatars.discourse-cdn.com/v4/letter/n/90db22/32.png) [@nearwildheaven](https://boards.straightdope.com/u/nearwildheaven)\ **Post date:** [June 9, 2018, 3:38am UTC](https://boards.straightdope.com/t/why-wasnt-blockbuster-prepared-for-online-movie-streaming/815470/116 "2018-06-09T03:38:27Z")
> [@TSBG](#): > > I worked for AOL in 1994-1995. They were always promising streaming vide was around the corner but it wasn’t, except for postage-stamp-sized 10fps experiments. I assumed it would never happen. Imagine my surprise when years later I discovered YouTube. I knew then the jig was up for a lot of companies, including video stores; the dominoes are continuing to fall. However I am not smart or active enough to have profited off this insight. > > By the way, for those seeking streaming movies and TV shows, the app JustWatch is useful though not the final word on where you can find stuff. And for real classics, the Criterion Collection has moved around but is now available through a service called Filmstruck. For the first few years, You Tube videos were limited to 10 minutes at a time, so anything longer than that had to be split up. Now, there’s no time limit so anything goes as long as there aren’t copyright issues. And I still have my Netflix queue. It’s no longer capped at 500. ---
**Author:** ![Asuka](https://avatars.discourse-cdn.com/v4/letter/a/dec6dc/32.png) [@Asuka](https://boards.straightdope.com/u/Asuka)\ **Post date:** [June 9, 2018, 4:20am UTC](https://boards.straightdope.com/t/why-wasnt-blockbuster-prepared-for-online-movie-streaming/815470/117 "2018-06-09T04:20:02Z")
> [@dalej42](#): > > . > I use Redbox for new releases, there’s one across the street and I’d rather see a new release in blu ray quality. They’re always sending me promo codes, and I’m quite sure I couldn’t rent from Blockbuster for one US dollar, even in the 1990s. It was either Hollywood video or Blockbuster who had a few select 99 cent rentals and they called it their “Classic Cinema Collection” where for a two day rental you could watch stuff like Gone With The Wind or The Sound of Music on VHS. Somebody must have been subsidizing them for that to happen, wouldn’t be surprised if some studio gave it to them in bulk in exchange for putting a bunch of ads before the video started ---
**Author:** ![Dewey\_Finn](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/dewey_finn/32/4222_2.png) [@Dewey\_Finn](https://boards.straightdope.com/u/Dewey_Finn)\ **Post date:** [June 9, 2018, 4:29am UTC](https://boards.straightdope.com/t/why-wasnt-blockbuster-prepared-for-online-movie-streaming/815470/118 "2018-06-09T04:29:04Z")
Why do you think it was necessary for those rentals be subsidized? This is stuff that probably few people were renting (as opposed to the new releases) and the stuff was cheap. ---
**Author:** ![Asuka](https://avatars.discourse-cdn.com/v4/letter/a/dec6dc/32.png) [@Asuka](https://boards.straightdope.com/u/Asuka)\ **Post date:** [June 9, 2018, 9:38am UTC](https://boards.straightdope.com/t/why-wasnt-blockbuster-prepared-for-online-movie-streaming/815470/119 "2018-06-09T09:38:23Z")
> [@Dewey\_Finn](#): > > Why do you think it was necessary for those rentals be subsidized? This is stuff that probably few people were renting (as opposed to the new releases) and the stuff was cheap. Mainly because it was specifically those well known classic movies and not others. ---
**Author:** ![nearwildheaven](https://avatars.discourse-cdn.com/v4/letter/n/90db22/32.png) [@nearwildheaven](https://boards.straightdope.com/u/nearwildheaven)\ **Post date:** [June 9, 2018, 9:40pm UTC](https://boards.straightdope.com/t/why-wasnt-blockbuster-prepared-for-online-movie-streaming/815470/120 "2018-06-09T21:40:45Z")
My guess is that those movies were being rented often enough that giving them shelf space was profitable. ---
**Author:** ![steadicam](https://avatars.discourse-cdn.com/v4/letter/s/d6d6ee/32.png) [@steadicam](https://boards.straightdope.com/u/steadicam)\ **Post date:** [June 10, 2018, 7:24am UTC](https://boards.straightdope.com/t/why-wasnt-blockbuster-prepared-for-online-movie-streaming/815470/121 "2018-06-10T07:24:55Z")
> [@kanicbird](#): > > Actually at the time 1.5 Mbs was enough as HDTV was just a glean in the super rich’s eye, everyone else sported standard definition, with compression would be deliverable at that rate or slower. At the worst some buffering. I watch HD Netflix all the time with 1.5Mbs connection all the time… Rarely needs buffering. [Previous page](https://boards.straightdope.com/t/why-wasnt-blockbuster-prepared-for-online-movie-streaming/815470.md?page=5) [Next page](https://boards.straightdope.com/t/why-wasnt-blockbuster-prepared-for-online-movie-streaming/815470.md?page=7)