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  • Writer's pictureRightek

Netflix - The New Blockbuster?

Updated: Jul 3, 2023

Netflix has lost 60 percent of its stock value since November. Can they stop the bleeding, or will they end up like Blockbuster? This is Netflix vs Blockbuster.


The Netflix building showing the road below with a sunset.


How Did It Start?


Movies took place in movie theatres long before there was Netflix or even the internet. People went to the theatres every day in the late 1920s and early 1930s, and they virtually always saw the same pictures. That all changed with the release of The Jazz Singer, the motion picture industry's first "talkie." This 1927 film was the first to use a microphone, and its soundtrack — which contained the world's first musical number —completely transformed the way people viewed movies forever.

Blockbuster Video


There have been significant changes in the industry since then. Movies were increasingly popular, and with everyone having a way to watch movies at home, Blockbuster was the inevitable next step in entertainment. The massive video rental chain commanded the industry, rapidly acquiring additional outlets and smashing any firm that stood in its way. However, something extraordinary happened in the 2000s: Blockbuster began to lose consumers. The company's answer was to focus even more on its core business, investing millions of dollars but ultimately closing hundreds of storefronts around North America.


Netflix


When did Netflix get its start? Reed Hastings and Marc Randolph, two college buddies, sought to develop a way to rent movies without having to drive to a video rental establishment. In early 2000, Hastings and Randolph offered to sell their company, Netflix, to Blockbuster for $50 million. Blockbuster turned them down. Hastings and Randolph didn’t give up so easily, however. They decided to take their company online, and over the next decade, Netflix revolutionized the movie rental industry. They decided to move their company online, and Netflix changed the movie renting industry over the next decade. The company's original content, which featured award-winning films such as Mudbound and The Hurt Locker, helped to create the online streaming market and changed the way people watched television. Netflix eventually faced up against HBO and triumphed, pushing the entertainment sector to adapt to a new way of consuming media.


History Repeats


Today, Netflix is in trouble. The quality of the company's original material has dropped in recent years, and its streaming service is significantly less inventive than it once was. As a result, Netflix is in the midst of an unparalleled crisis. The company's stock is down more than 65 percent from its all-time high in November 2021, and it has lost over 200,000 clients worldwide and expects to lose another 2 million. The corporation attributes the client loss to password sharing; nevertheless, password sharing is nothing new.


Summary


Netflix's escalating pricing, along with the introduction of an ad-supported tier, has left many with a bad taste. And, with stock prices plunging, you can't help but wonder if they'll follow in the footsteps of the ultimately failed Blockbuster.



What are your thoughts? Will you stick with Netflix?




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