Hundreds of video rental stores to close in US

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Hundreds of video rental stores to close in US

The small video rental shop dealt another blow with news of 300 Blockbuster shops to close in US.

A plan to close another 300 Blockbuster video rental stores in the US and the decision to put the company's UK operations into administration (with the closure of 150 stores) is another sign that the traditional video rental market is in trouble.

Presumably the stores being closed are company owned rather than franchised outlets, but it would appear that the writing is on the wall for video stores generally.
The problem for the operators is largely that technology has shifted the market online. It seems that people who still want to rent physical discs regularly have tended to move to web-based services - you set up a 'want list', the first disc(s) is sent to you, and then next available title is dispatched when you return it. Fine for the big companies, but it doesn't help their franchisees.
Movie streaming services are growing in popularity, especially in the US where monthly download quotas imposed by ISPs are still the exception rather than the rule. Blockbuster and Netflix play in this market, along with others such as Apple's iTunes service.
ISP charges and connection speeds mean streaming isn't hugely popular in Australia yet (though the NBN should take care of the latter issue), but Foxtel is in around one-third of Australian households with a relatively short term target of 50 percent, and offers pay-per-view movies.
The moral of the story for anyone running their own business - independent or franchised - is that they need to think carefully about what business they are in, and keep an eye open for technological changes that may affect that business.


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