8/19/2023 0 Comments Sites like shushLike the executives at Blockbuster, the executives at Britannica eventually recognized the threat of digital technology but couldn’t see their way to abandoning their old business model and their old production standards and the reliable profits that came with large sets of big books. They were revolted by the thought of their masterpiece reduced to an inexpensive plastic bolt-on to a larger piece of software for gimmicky home computers. The Britannica people told Gates to get stuffed. He believed that the availability of a CD-ROM encyclopedia would encourage people to adopt Microsoft’s Windows operating system. He didn’t want to go into the reference book business. Just as the glorious fifteenth edition was going to press, Bill Gates tried to buy Encyclopedia Britannica. It was sold door-to-door in the US by a sales force of 5,000. It was the greatest encyclopedia ever published and probably the greatest reference tool to that time. By the time of its fifteenth edition in 1989, the continuously revised Britannica was comprehensive, reliable, scholarly, and readable, with 43 million words and 25,000 illustrations on a half million topics published over 32,640 pages in thirty-two beautifully designed Morocco-leather-bound volumes. The star of Garfield’s show, naturally, is Encyclopedia Britannica, which dominated the field through the nineteenth and twentieth centuries. It’s an entertaining history of efforts to capture all that we know between covers, starting two thousand years ago with Pliny the Elder. I remembered all this while reading Simon Garfield’s wonderful new book, All the Knowledge in the World: The Extraordinary History of the Encyclopedia. It was only three years from Keyes’ hiring to bankruptcy proceedings. The idea was that Netflix was a distraction and Blockbuster needed to sell more Milk Duds to people who were still leaving their homes to rent movies. Keyes shut down Antioco’s digital innovations and doubled-down on protecting Blockbuster’s investment in its 9,000 stores. He thought he knew better than Antioco how to run Blockbuster, pushed him out, and replaced him in 2007 with James Keyes, who used to run the 7-Eleven retail chain. Every time Antioco ran another cycle of advertising for Blockbuster Online, Netflix CEO Reed Hastings could feel the promise leaking out of his business.īlockbuster might have killed Netflix in the cradle but for the activist investor/corporate raider Carl Icahn. It’s easy to see why: Blockbuster had deep pockets, existing relationships with tens of millions of customers, a fantastic brand, great relationships with the movie studios, and 9,000 stores out of which to market its new service. All the business ran through those stores.Īntioco wasn’t a perfect CEO: he blew a chance to acquire Netflix for $50 million in 2000, saying “the dot.com hysteria is completely overblown.” But his digital subscription service, launched in 2004, was effective enough that Netflix saw its life flash before its eyes. Blockbuster was huge at the time: 9,000 outlets, revenues of $6 billion, $800 million of that in late fees. ![]() Blockbuster CEO John Antioco started his own online DVD subscription rental business-Blockbuster Online-and put his best people to work on building a streaming service, much to the consternation of some of his staff and investors who believed Blockbuster’s strength and future resided in its bricks-and-mortar stores. I was fascinated to learn that senior management at Blockbuster figured out early that Netflix was a problem, even back when Netflix was distributing its movies in DVD format through the mails (a service, astonishingly, it discontinued only this week). Despite its title, it is as much about the downfall of the Blockbuster video chain as it is the rise of a digital streaming service. One of my favorites is Gina Keating’s Netflixed: The Epic Battle for America’s Eyeballs (2012). There are a lot of good books about the rise of the internet and its destruction of conventional media.
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