The truth about Blockbuster. Dismantling the example of no matter what you hate

The truth about Blockbuster Is there something you hate about your life and the world you live in? The heteropatriarchy? Communism? The carrots? You just have to do like the frayed film directors or some militants whose ideological knowledge comes from Rincón del Vago. Blame him for closing Blockbuster.

It does not matter that from its founder to the main analysts of the industry have gotten tired of showing that the only ones to blame for the closure of this gigantic chain of video stores be your own shareholders. The unsubstantiated explanations are still alive.

A clarification to avoid sterile discussions. Although the tweet that gave rise to this article is from an anti-capitalist, I am not writing against any political tendency. The lightness of the theoretical training is not the patrimony of any of them. Is the result of the shortcomings of an educational system that in my generation it is based on the photocopies of chapters rather than on the reading and analysis of complete books. For the next one there were already summary sites such as Rincón del Vago and Wikipedia and currently YouTube and social networks.

What was Blockbuster?

Every time a technology produces a change in customs, those who are subjected to competition sThey feel threatened and ask for protection by taking refuge in sources of work that generate. One particularly curious case is that of London horse drivers who did not look favorably on the manufacture of umbrellas.

But, it also happened with:

  • Theater entrepreneurs with the appearance of cinema.
  • The editors of newspapers with the appearance of the radio.
  • The owners of cinema with the appearance of television.
  • Radio stations with the emergence of television.

In 1975, when Sony introduced its video recording technology, history repeated itself again. The owners of the cinemas clamored for the closing of the cinemas. Advertising agencies complained about the possibility of skipping advertisements. The ideal villain "piracy" and unsuccessful attempts to combat it appeared at this time.

If you paid attention to the list above, you will have seen that none of the forms of content distribution disappeared. The one that is not there anymore is that of the video stores.

Video stores (as they were called in Argentina) or video stores, they were locals that rented you a video cassette (or dvd in its last days) with a movie for a limited time. To run a video store legally you needed a strong capital investment  to not only have an extensive catalog of movies constantly updated, but also to replace titles with deteriorated hardware.

Being an international chain, Blockbuster the market was eating away at the small neighborhood video stores. To begin with, I had much more capital to invest in titleyou. You no longer had to wait months to see that movie that everyone was interested in. And the quality of the image. as the support medium was renewed more often, it was better. An added bonus was that right there could you buy something to eat and drink to accompany the movie.

The great advantage of streaming services over Blockbuster is that they open the game to another type of cinematography (and people work in the production of those films) At least in Argentina, the supply of content was dominated by the North American industry. On Netflix I was able to watch independent cinema and movies from countries like India, Korea, China or Israel. None of that was achieved at Blockbuster.

And in the sector of the provision of Internet services, people also work. Installers, administrative, software specialists, technical support. In all political systems one technology replaces another and sources of work are modified. The USSR in 1970 was not the same as in 1917.

The Truth About Blockbuster: Why It Closed

According to specialists, the reasons for the closure of Blockbuster are:

  • Inability to generate profitability: From 1996 to 2010, Blockbuster was only profitable for two years. And between 2002 and 2006, it lost about $ 4.400 billion.
  • Lower prices for DVDs:  Comparatively, it was more business to buy the DVD of the movie you liked than to rent it from Blockbuster.
  • Indebtedness: The company asked for a loan to pay its controlling company Viacom and be able to become independent. Experts believe that the payment of that debt was one of the causes of its end.
  • Indiscriminate opening of new premises without thinking about the ability to produce profitability
  • Excessive late fees on the return.
  • Competition: Retailers like WalMart or BestBuy and smaller, more efficient video chains entered the market with lower rent.

The truth is that technological advancement and change in living conditions is asomething associated with human beings regardless of economic systems. In fact, some of us we are in a post Netflix stage.

Of course the future of work it is a discussion that we have to give urgently. But cry for inefficient companies and anachronistic services, It is not the way.


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  1.   Leo said

    I give you an example. Uber vs taxis. Here in Colombia, taxis are a mafia that relies on the same excuses set out in your article.
    They also become expensive and inefficient with respect to a new and better service as well as better technology such as Uber. They took Uber out of circulation this year but even with the mafia move they will not be able to avoid the inevitable and that is that the competition will one day eat them up no matter how many barriers they put up.

  2.   Danny O said

    anti-capitalist communists talking about economics on twitter, XD who needs memes with such luminaries.

  3.   01101001b said

    Sep, "everything that has a beginning, has an end." The times change.

    Jobs do not exist because there are people to feed. They are because someone has a problem (the one who offers the job) and needs someone else to solve it (an employee), and x that solution that provides (work), receives remuneration (salary).

    When the original problem disappears, the need for that transitory "solution" also disappears.

    What are these political charlatans up to? Inventing problems that nobody needs to pay for a solution that is not necessary? Let them give away their money to the people who need it. They won't. Xq are desolate without sense that they go x life claiming rights that do not exist (as others have the obligation to resolve their lives).

  4.   G said

    The tweet is so ambiguous that it is even right and does not conflict with this article.

    Blockbuster went bankrupt due to being obsolete as well described in this article and Netflix did not appear to have the intention or direct blame for its downfall. Just as it could be Netflix it could be another. Now Netflix we will see if it is out of the market thanks to the mega corporations of Disney, Amazon and HBO. And of course, this is the capitalist jungle. The largest eats the smallest and the most adapted eats the misfit.

    What the tweet says is that because blockbuster went bankrupt, thousands of workers who worked there were unemployed. And that is true. He then says that with Netflix, only Netflix benefits, and that is also true. Blockbuster also benefited blockbuster, but salaries were also paid. And finally he says that these are the "benefits" of capitalism. And again, it is also true. Technological innovation is valued according to the generation of wealth not for workers or consumers but for capitalists. In this case, distributing audiovisual content is more efficient and scalable with the internet and that makes the employees of the video stores become obsolete for the labor market. It is an excellent example of how capitalism generates wealth for the few at the expense of the working class, which is increasingly obsolete economically speaking.

    The tweet at no point says anything false or misleading. Perhaps what can be seen is that the author of this article feels impelled by this anti-capitalist tweet to write a response that puts it as an example of "lightness of theoretical training" and it seems that his purpose comes to be to defend capitalism from this invalid attack.

    But at no time did the author refute or confirm the tweet and even this article complements what the tweet says and proves his point: capitalism is a disaster that generates human crises while promoting technological advance by and for capital.

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