The death of the media

giants

With media streaming quickly being adopted, what will become of their predecessors?

By TK Kwon

he year is 1997, there is a VCR in almost
every home and new to the scene is the

highly sought after DVD. After the failure
of Laserdisc in the 80’s, the prominent rise of the
next generation of compact media starts to make
waves in the hierarchy of social extravagance, for
DVDs and their subsequent players come at a high
price. The mass adoption of the DVD as well as
the continuing lifeline of the VHS gives new life
to already monolithic media rental giants such
as Blockbuster and Hollywood Video, who are
ferociously competing amongst each other to claim
monopolistic dominance. There are no such things
as plasma televisions or Blu-Ray and the lexicon
“high-definition” and “YouTube” mean nothing. At
least not yet.

In its infancy, society would have never
thought of the social control and dominance that
the internet would have worldwide. No matter
where one looks, something is regulated by the
internet, whether it be advertisements or local news.
However, no one seems to mind, for it has become
a social norm to interact regularly with the internet,
whether it be vicariously living through videogames
like World of Warcraft or sharing a pirated movie
through an ad nauseam list of Peer-2-Peer networks
with the likes of LimeWire and BitTorrent.

At first, the giants thought nothing of it, for
as long as they could nip the problem in the bud
by working with the federal police they could end
the rampant explosion of piracy. By utilizing fear
mongering they hoped to put an end to the thorn at
their side. In hindsight, not only was this a fruitless
tactic, the corporations also failed to see possible
market implementations opportunities that were
worth nurturing. So the internet snowball continued
to roll, unknown to the media giants, what awaited
them below would be an unstoppable avalanche.

Enter Netflix. Unlike Blockbuster, they
took a different approach to media rentals. They
figured out that one of the causes of piracy was
convenience, so they ran with it and started to
offer home deliveries for their rentals, which was
unheard of at that time. But it didn’t stop there,
Netflix also decided that they would discard —
the concept of late fees, but rather implement a
maximum rental limit to encourage prompt returns.
Blockbuster chuckled, then scoffed, and then
started to sweat. Other entrepreneurs caught onto
Netflix business model, and from it rose Gamefly,

a subscription-based videogame rental service. The .

media giants, already hindered by the decline of —
VHS and the transition into the Blu-Ray/HD-DVD
fray, found themselves between a rock and a hard

While these fledgling companies saw

 

promising growth, the internet itself was
experiencing an evolution of its own. The clunky
operation of dial-up was quickly abolished and a
much more effective replacement came in the form
of DSL and broadband. These new internet modes
filled more homes and made the internet hassle-free
and breakneck fast.

Aside from downloading, the trend started to
lean towards internet streaming, which was made
possible by the now faster and stable internet.
Netflix caught on to this new trend, Blockbuster,
which by now had acquired Hollywood Video, did
not. Netflix saw their competition flounder with
their traditional business model and decided it was
time to deal the final blow. Netflix then announced
their new subscription service, unlimited movies via

Qi vaios

internet streaming at an affordable price point.

The Blockbuster franchises saw their imminent
doom, and in a last ditch effort began to offer a
similar program in hopes that their brand-name
would give them an upper hand. It didn’t. They
delivered too little, too late. On September 23",
2010 Blockbuster filed for bankruptcy and thus
began to liquidate their assets.

From the ashes of their predecessors the new

‘media giants exhibit their newly found market

dominance. But let these companies beware, not to
follow the same road as their forerunners, because
for every Netflix there is a YouTube Rentals and for
Gamefly an OnLive. In this questionable economy
with consumers glued to the internet, there’s no way
of knowing exactly how the dice will roll.

 

 

 

 

 
 
  

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