Jan 18, 2013 - startup    No Comments

Why HMV and Blockbuster went into administration

The way we consume music and movies have changed so much since the days HMV and Blockbuster started. New generations, new ways of consuming media.

administration

It’s unfortunate that companies fail to view this and adapt to the changing ways of media consumption. Perhaps the CEO who are expected to set the vision are to be blamed for failing to set the companies in the right direction amidst changing surroundings.

Failure to change their strategy caused both companies to go down. HMV went down because of: iTunes, Spotify, Amazon as well as illegal downloads who represent the new way people or shall we say the new generation are consuming media. They did not adapt and have paid the price for it. If they had evolved with an online download service of their own, their fate would have most probably been different.

Same goes for Blockbuster, online services like Netflix, Lovefilm, and iTunes have taken over, of course with the illegal streaming services upsetting the legal consumption channel as well.

Take a look at PCWorld they have a cloud backup service, they are evolving which is good. New ways of doing business, new revenue streams, etc. Of course they have competitors like box, Dropbox, etc. but they are not missing new opportunities in the digital world. Game now offers downloads for games. Steam in the game arena is a big player.

The bottom line is the internet has become so powerful and accessible that these are new ways of consuming media. People want media and they want it now. They do not want to wait 2 days to get it by post or go to the shopping centre to get it when they can get it all via internet.

This is what these companies have failed to understand unfortunately.