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Blockbuster Could Have Bought Netflix for $50M

62 points by GordonS 7y ago

alexhutcheson 7y ago
It still would have been a bad deal, because there is no way that Blockbuster would have given them the freedom and the funding necessary to execute their pivot from a DVD-by-mail service to a streaming video service.
- empath75 7y ago
  Yep would have been aol/time warner all over again.
- gandalfian 7y ago
  Blockbuster did put lots of money into developing streaming technology and absolutely saw it as the future. But they were too early and gained no traction. By the time the moment arrived they no longer had the money and energy. But overal I agree Netflix wouldn't have been Netflix if it had sold out early.
  - basch 7y ago
    Also, the main other party in the 2000ish Blockbuster streaming service was Enron. So it probably would have collapsed or fallen into troubled times and been acquired, no matter what.
    - technofiend 7y ago
      Enron was also trying to create bandwidth commodities that traded the same as energy, which was typical of Enron. Create a market, make use of the market and double dip on profits. https://www.wired.com/2001/11/enron-a-bandwidth-bloodbath/ https://www.wired.com/2001/11/enron-a-bandwidth-bloodbath/
  - agumonkey 7y ago
    I'd love a list of all the too-earlys ..
    - gandalfian 7y ago
      I can only remember the conman who claimed he could do broadband over dialup. https://web.archive.org/web/20170320224412/http://jacksonville.com/tu-online/stories/050502/met_9322821.html https://web.archive.org/web/20170320224412/http://jacksonvil... but statistically they must have thrown money at someone who wasn't a crook, mustn't they?
    - new_realist 7y ago
      Six Degrees: Facebook met LinkedIn in 1997.
      - agumonkey 7y ago
        oh yeah .. indeed too early
    - INTPenis 7y ago
      My favorite is Microsoft Terra which was designed mostly to show off their SQL database. THey had no idea about the power of personal data that Google would exploit much later with Google Earth.
      - agumonkey 7y ago
        Ah well, very similarly DEC made altavista to show off so never thought of it as a product. Then Google came.
        INTPenis 7y ago
        Really? I had no idea Altavista was from DEC. In school in sweden we actually had a computer class where they taught us to use altavista. This was before Google blew up.
  - kjksf 7y ago
    > But they were too early and gained no traction As I understand the history of Blockbuster, the CEO was actually winning against Netflix. It was obviously costly fight (needed lots of investment). The Blockbuster CEO met his performance goal and was expecting hefty bonus but Carl Icahn, a board member and big Blockbuster shareholder, torpedoed the bonus award. CEO quit. The next CEO reduced spending in dvd-by-mail and online streaming and Netflix won. https://www.businesswire.com/news/home/20110318006089/en/Happened-Blockbuster-Story-John-Antioco-Carl-Icahn https://www.businesswire.com/news/home/20110318006089/en/Hap... So you could say that Blockbuster lost because Carl Icahn is an idiot and single-handedly destroyed Blockbuster. There's no indication that they lost because they were "too early". In fact, their online product was "pay-per-view" while Netflix was "all-you-can-eat" https://www.cnet.com/news/netflix-vs-blockbuster-whats-the-best-service-for-streaming-and-dvds/ https://www.cnet.com/news/netflix-vs-blockbuster-whats-the-b...
    - zaphirplane 7y ago
      Too early can be, when bandwidth was slow and download cap were small. Downloading was discouraging
- overcast 7y ago
  The irony(maybe?) here is that DVD-by-mail is the ONLY way I can watch 99% of the movies out there. Streaming services are shit in comparison. They win in convenience, but barely.
  - paggle 7y ago
    The high quality unpopular movies don’t make it on anyone’s radar to negotiate streaming rights. The high quality popular movies are too valuable to offer to Netflix for a price they would be willing to pay. I like Amazon’s pay-per-watch system much better.
    - overcast 7y ago
      But even that doesn't have EVERYTHING. It's very rare, that I don't find even the most obscure stuff available on Netflix DVD service. I'm a huge film fanatic, and $20 for roughly 3 movies a week is a steal. Streaming service video/audio quality just isn't on par with a Blu-Ray disk. The audio is often horrendous, which I understand most don't care about as long as they can see the picture on their $175 4K TV from Costco. Also, I wish their old distributions points would open back up, used to be next day turn around and Saturday :( I honestly don't know what I would turn to if the service went away.
      - paggle 7y ago
        Yeah, I’m not as much of a film buff as you. Pay to rent on Amazon does the job for me except about once a year when I order a disc.
    - technofiend 7y ago
      I wonder if the answer to this is adopting the mechanical royalty model from the music industry. Anyone can stream the movie but a royalty must be paid.
  - ghaff 7y ago
    However, the Netflix DVD back catalog is effectively falling out of availability. Disks for low-volume movies are obviously not being replenished as they get lost, scratched, etc. I'm seriously thinking of just dropping my Netflix DVD-by-mail subscription at this point and "putting" the money into my disk purchase budget.
- gwern 7y ago
  Why not? Netflix itself thought that Blockbuster's 2007 'Total Access' program was going to drive Netflix into bankruptcy: https://twitter.com/modestproposal1/status/1155147785467023361 https://twitter.com/modestproposal1/status/11551477854670233...
werber 7y ago
And Yahoo could have bought Google for even less. I would love to hear from the people who turned these kind of deals down
- bartread 7y ago
  Me too. Although the thing is it probably made sense at the time. Also, it's far from guaranteed that Yahoo would have made a success of Google, or Blockbuster of Netflix, so whilst there can be an entertaining schadenfreude to stories like this it's not something you can take too seriously.
  - lifeisstillgood 7y ago
    This is the crux of it - if Google had asked me to be employee number one there is a very good chance Brin and Page would have gone back to academia.
- xuki 7y ago
  Didn’t they have the chance to buy Facebook for 1B too but they reduced their offer at the last minute and Zuckeberg said no? I’m convinced the people at Yahoo didn’t know what they were doing and both Google and Facebook would fail spectacularly within Yahoo.
  - mcny 7y ago
    I remember Microsoft bought a stake in Facebook at 15B valuation or something. I didn't know much about funding then (I still don't) but I thought how much money that put in was more important than the valuation. I can too invest $1 in Facebook at $100B valuation I thought. To me the point was not to earn dividends but to have Zuckerberg's ear and hopefully have a say in how Facebook is run.
- protomyth 7y ago
  It would make for an interesting website: the what-if of Silicon Valley. Another famous one is that Sun could have bought Apple. It was in the intermission between Steve years.
cryptofits 7y ago
If you will look hard enough, you can find FOMO in so many different things. If you were lucky enough to purchase 100 shares of McDonald's when it was at $22.50 on its IPO date, you would have spent $2,250. Based on McDonald's closing stock price on October 28, 2018, the investment would be worth $12.89 million. We can also talk about Bitcoin but I think you got my point
- jghn 7y ago
  A colleague was big on Bitcoin in mid-late 2009. I declared it to be stupid and didn't bother. By the time I realized that was a mistake it was too late, the days of normal people mining coins was long gone. I've convinced myself that I'd have lost my wallet long before it became valuable anyways. It helps me sleep at night.
  - yardie 7y ago
    If it makes you feel any better there were a lot of alt-currencies around that time. Many were marketed as being untraceable to avoid government interference and taxation. And many were used for laundering, drugs, and childporn. Around that time I was aware of bitcoin but I was paid for some dev work once in e-coins and had the hardest time converting that to cash, which is how I paid rent. And while it made up a small part of my compensation I thought it was ridiculous. Something tinfoil hat wearers cooked up. It's easy to say it bitcoin was going to be big, in hindsight. I used one of their early ATMs to pay for pizza. At the time it was trading for ~$2. I didn't think much of it until years later when it got a meteoric rise.
  - marvin 7y ago
    Or you would have sold it the moment your holdings had any real value. 99% of all people would have done this. You need a very uncommon «speculator’s» or «investor’s» mindset to be this deep into _anything_ as an individual. If you buy any single asset with the idea that it might increase 10x to 10000x in value, any degree of success will put you in a position where continuing to own it is in direct violation of a «sensible» investment policy.
jcims 7y ago
I could have stuck with my little bitcoin experiment in 2011.
- lifeisstillgood 7y ago
  Thank you. I have about a dozen different "If only" moments in my tech life, from turning down job offers to not making tech experiments into real businesses (Twitter and Docker, parking payments by mobile and a really good enterprise marketing system) I regret them all because I think they all definitely would have made me bajillions. including leaving running a bitcoin miner machine in the corner of my office instead of turning it into a build server. But frankly I probably would not be a billionaire by now had I done any or even all of those great ideas in hindsight It won't stop me trying for the next one, but it will mean if I duck out with even a small win it's a big triumph
  - jcims 7y ago
    The only salve I have to apply for my missed bitcoin burn is the absolute reality that I would have unloaded a thousand of them as soon as they got to be worth a couple of bucks. That would have been way worse.
noego 7y ago
> Randolph writes that he'd been closely watching Antioco during this conversation. Throughout, the Blockbuster CEO appeared as a polished professional, leaning in and nodding and giving every indication of someone who was listening attentively. Now Randolph observed as an odd expression crossed Antioco's face, turning up the corner of his mouth. It lasted only a moment, he writes. "But as soon as I saw it, I knew what was happening: John Antioco was struggling not to laugh." Great article but it seems unnecessary to accuse Antioco of being arrogant just because he turned up the corner of his mouth for a moment. There are tons of investors who pass up on great investment opportunities every year. Most of them aren't arrogant, they are simply normal people who don't have the benefit of perfect hindsight.
- FussyZeus 7y ago
  And more to the point, success in business is determined just as much by blind luck as anything else. If Antioco had sprung on Netflix, who knows how many other things he might've sprung on too? And even assuming Netflix worked out, who's to say the other investments wouldn't have killed Blockbuster in the process anyway? This whole genre of articles confuses me. Is the message be open to new things? Is it about other investors feeling regret for things they've passed on, or worry about the things they didn't? I don't understand this at all.
  - mikeash 7y ago
    Yep, we’d probably be reading about how stupid Blockbuster was for buying Netflix when it was Moovster that kicked everyone’s ass.
  - RobertKerans 7y ago
    > This whole genre of articles confuses me. Is the message be open to new things? Is it about other investors feeling regret for things they've passed on, or worry about the things they didn't? I don't understand this at all. Myth-making, mythologising. The genre is "business, but written as adventure/thriller" I guess? Comes across as attempts to imply that it's all epistemological. It's just turning things into a good story though, you're maybe reading too much into it? (Although every one of these I've read seems to go something like: "I should have been terrified. But I was calm, I knew what I had to do. My whole life had been building up to this meeting with Corpocorp. The team was gearing up for the battle that lay behind those huge frosted glass doors. I looked at them, and tears pricked at the corners of my eyes. 'Goddamn' I thought, 'this is the best bunch of guys ever put together for business purposes', and my heart swelled with manly pride. Joe Spiff had been my first hire. He was the best money talker I'd ever met. I looked at him now, laser focussed on the dollar bill held between his fingers. This was his routine, I'd seen him do it a hundred times. He'd sit and stare at that bill for ten minutes, unblinking, not moving a muscle. Then he'd just...crush it between his fingertips, quick as a flash. Lawyerman Pete was [contd.]")
dmitryminkovsky 7y ago
Lycos could have bought Google for 700k. If you bought a share of Home Depot in 1982 you’d be a millionaire. Can’t think of a more banal form of what-if-ism than looking back at missed market opportunities.
- overcast 7y ago
  You could easily be a millionaire multiple times over working a normal job for 38 years too.
  - dmitryminkovsky 7y ago
    Yep!!
jvagner 7y ago
I was part of an e-commerce company selling DVDs in the mid 90s, watching: Amazon enter the space, a bedroom porn operation start to rise in the adult dvd mailing market, and Netflix getting a start. We were ripping the movie trailers off the DVDs and encoding them, streaming them on the product page. All we had to do was rip the whole movie and make licensing deals with the studios we were sourcing our products from, and BAM, we coulda been Netflix too.
- jlosito 7y ago
  I hear that’s not far off from what these streaming services do in reality.
blantonl 7y ago
I think the part in this article where John Antioco is perceived as arrogant is a little misguided. It's important to remember that a natural gas pipeline company based in Houston was vying to put Blockbuster out of business with their own "Broadband" unit, and it indeed was laughable. And we all know what happened to Enron.
simonebrunozzi 7y ago
Tried to post the same thing a couple of days ago [0], but no discussion happened. [0]: https://news.ycombinator.com/item?id=21010244 https://news.ycombinator.com/item?id=21010244
Causality1 7y ago
Yeah, and we could've all bought bitcoins for pennies when we first learned about them. The biggest barrier to understanding past decisionmakers is that we know how it turns out and they didn't.
pweezy 7y ago
Check out the podcast "Business Wars" by Wondery. They have an 8-episode miniseries on Netflix vs. Blockbuster that I really enjoyed and highly recommend. It includes this story, as well as some of the other competitive developments that, as crazy as it sounds now, at the time almost looked like they would bring a victory to Blockbuster.
oblib 7y ago
My wife, when we first met in the mid-90s, used to get DVDs at Blockbuster and always returned them late and paid the late fees with no complaints, which were huge. The first time I went with her to return some they took her money and then told her she was no longer allowed to rent them there anymore. She was pretty bummed out about that but I was shocked by how much their late fees were and explained to the manager that my wife was paying them way more than their customers who returned them on time and they may want to reconsider. Her response was about as snotty as can be. She said something like "We need them back on time for our good customers". We left laughing because that just seemed crazy and we knew she'd be saving literally $100s per month. But I was puzzled about why they'd do that. It made no sense at all to me. She was giving them a lot more money each month than their "good customers" which I thought should have put her at the top of that list. And the manager, who was so rude, clearly got a sadistic joy out of telling people "No more DVDs for you!" like the "Soup Nazi" on Seinfield. Before we'd met I'd never even been in a Blockbuster so that was my only real experience with them and I remember well thinking their customers would flee like rats from a sinking ship when a viable alternative came out. As soon as I heard of it we bought a Roku and ditched our "Dish" satellite service and after using it I knew Blockbuster was going to take a big hit from that little black box. It was just a few years later I read they were going out of business. By then I'd seen people lined up at "Redbox" dispensers and the Blockbuster where we lived had already closed up. I have to admit that seeing Blockbuster die like that warmed my soul like a bowl of good hot soup
- dlp211 7y ago
  I think the problem here is that you are assuming that the amount that your wife was paying made up for the lost sales of unhappy customers when titles aren't available. The math is not revenue for someone else to rent at normal rate vs. the revenue for your wife to hold onto the title, but rather the revenue from a customer that keeps coming back vs. the late cost revenue minus the the lost cost customer revenue.
  - kshacker 7y ago
    Having seen the rates for late rentals, I think your parent comment is "more" right. Unless blockbuster was running such a tight ship that a single rental's delay would upset the applecart ... but I remember waiting for DVDs and cassettes and unless you hit the sweet spot (a few weeks after the release, or maybe just on the first day of release), there was always a wait and/or the associated frustration.
tempsy 7y ago
GameStop is a very interesting stock bet right now. It could easily go to route of Blockbuster (most obvious route), but it could do so many things to not be another crappy retail experience. Not confident they will turn it around but there's certainly an opportunity for a brick-and-mortar game shop done right.
- parsimo2010 7y ago
  With GameStop's several year history of bad public opinion and what appears to be decaying market share, I wouldn't bet on it. The current management is clearly willing to accept the status quo and won't take the actions necessary it "turn it around." New management could signal that good changes are coming, but it could also signal that specialists have been brought in to carve the assets up before bankruptcy. I'd say it's far more likely that GameStop ends up like Blockbuster and Sears, even if they potentially could turn things around.
- Vadoff 7y ago
  If they had the ability to turn it around, they would have... years ago. Unless they get a new CEO/leadership and take radical shifts in strategy, I don't see anything happening.
simonblack 7y ago
"The Innovator's Dilemma." It's been the downfall of many a commercial empire.

62 points by GordonS 7y ago

It still would have been a bad deal, because there is no way that Blockbuster would have given them the freedom and the funding necessary to execute their pivot from a DVD-by-mail service to a streaming video service.

empath75 7y ago
Yep would have been aol/time warner all over again.
gandalfian 7y ago
Blockbuster did put lots of money into developing streaming technology and absolutely saw it as the future. But they were too early and gained no traction. By the time the moment arrived they no longer had the money and energy. But overal I agree Netflix wouldn't have been Netflix if it had sold out early.
- basch 7y ago
  Also, the main other party in the 2000ish Blockbuster streaming service was Enron. So it probably would have collapsed or fallen into troubled times and been acquired, no matter what.
  - technofiend 7y ago
    Enron was also trying to create bandwidth commodities that traded the same as energy, which was typical of Enron. Create a market, make use of the market and double dip on profits. https://www.wired.com/2001/11/enron-a-bandwidth-bloodbath/ https://www.wired.com/2001/11/enron-a-bandwidth-bloodbath/
- agumonkey 7y ago
  I'd love a list of all the too-earlys ..
  - gandalfian 7y ago
    I can only remember the conman who claimed he could do broadband over dialup. https://web.archive.org/web/20170320224412/http://jacksonville.com/tu-online/stories/050502/met_9322821.html https://web.archive.org/web/20170320224412/http://jacksonvil... but statistically they must have thrown money at someone who wasn't a crook, mustn't they?
  - new_realist 7y ago
    Six Degrees: Facebook met LinkedIn in 1997.
    - agumonkey 7y ago
      oh yeah .. indeed too early
  - INTPenis 7y ago
    My favorite is Microsoft Terra which was designed mostly to show off their SQL database. THey had no idea about the power of personal data that Google would exploit much later with Google Earth.
    - agumonkey 7y ago
      Ah well, very similarly DEC made altavista to show off so never thought of it as a product. Then Google came.
      - INTPenis 7y ago
        Really? I had no idea Altavista was from DEC. In school in sweden we actually had a computer class where they taught us to use altavista. This was before Google blew up.
- kjksf 7y ago
  > But they were too early and gained no traction As I understand the history of Blockbuster, the CEO was actually winning against Netflix. It was obviously costly fight (needed lots of investment). The Blockbuster CEO met his performance goal and was expecting hefty bonus but Carl Icahn, a board member and big Blockbuster shareholder, torpedoed the bonus award. CEO quit. The next CEO reduced spending in dvd-by-mail and online streaming and Netflix won. https://www.businesswire.com/news/home/20110318006089/en/Happened-Blockbuster-Story-John-Antioco-Carl-Icahn https://www.businesswire.com/news/home/20110318006089/en/Hap... So you could say that Blockbuster lost because Carl Icahn is an idiot and single-handedly destroyed Blockbuster. There's no indication that they lost because they were "too early". In fact, their online product was "pay-per-view" while Netflix was "all-you-can-eat" https://www.cnet.com/news/netflix-vs-blockbuster-whats-the-best-service-for-streaming-and-dvds/ https://www.cnet.com/news/netflix-vs-blockbuster-whats-the-b...
  - zaphirplane 7y ago
    Too early can be, when bandwidth was slow and download cap were small. Downloading was discouraging
overcast 7y ago
The irony(maybe?) here is that DVD-by-mail is the ONLY way I can watch 99% of the movies out there. Streaming services are shit in comparison. They win in convenience, but barely.
- paggle 7y ago
  The high quality unpopular movies don’t make it on anyone’s radar to negotiate streaming rights. The high quality popular movies are too valuable to offer to Netflix for a price they would be willing to pay. I like Amazon’s pay-per-watch system much better.
  - overcast 7y ago
    But even that doesn't have EVERYTHING. It's very rare, that I don't find even the most obscure stuff available on Netflix DVD service. I'm a huge film fanatic, and $20 for roughly 3 movies a week is a steal. Streaming service video/audio quality just isn't on par with a Blu-Ray disk. The audio is often horrendous, which I understand most don't care about as long as they can see the picture on their $175 4K TV from Costco. Also, I wish their old distributions points would open back up, used to be next day turn around and Saturday :( I honestly don't know what I would turn to if the service went away.
    - paggle 7y ago
      Yeah, I’m not as much of a film buff as you. Pay to rent on Amazon does the job for me except about once a year when I order a disc.
  - technofiend 7y ago
    I wonder if the answer to this is adopting the mechanical royalty model from the music industry. Anyone can stream the movie but a royalty must be paid.
- ghaff 7y ago
  However, the Netflix DVD back catalog is effectively falling out of availability. Disks for low-volume movies are obviously not being replenished as they get lost, scratched, etc. I'm seriously thinking of just dropping my Netflix DVD-by-mail subscription at this point and "putting" the money into my disk purchase budget.
gwern 7y ago
Why not? Netflix itself thought that Blockbuster's 2007 'Total Access' program was going to drive Netflix into bankruptcy: https://twitter.com/modestproposal1/status/1155147785467023361 https://twitter.com/modestproposal1/status/11551477854670233...

werber 7y ago

And Yahoo could have bought Google for even less. I would love to hear from the people who turned these kind of deals down

bartread 7y ago
Me too. Although the thing is it probably made sense at the time. Also, it's far from guaranteed that Yahoo would have made a success of Google, or Blockbuster of Netflix, so whilst there can be an entertaining schadenfreude to stories like this it's not something you can take too seriously.
- lifeisstillgood 7y ago
  This is the crux of it - if Google had asked me to be employee number one there is a very good chance Brin and Page would have gone back to academia.
xuki 7y ago
Didn’t they have the chance to buy Facebook for 1B too but they reduced their offer at the last minute and Zuckeberg said no? I’m convinced the people at Yahoo didn’t know what they were doing and both Google and Facebook would fail spectacularly within Yahoo.
- mcny 7y ago
  I remember Microsoft bought a stake in Facebook at 15B valuation or something. I didn't know much about funding then (I still don't) but I thought how much money that put in was more important than the valuation. I can too invest $1 in Facebook at $100B valuation I thought. To me the point was not to earn dividends but to have Zuckerberg's ear and hopefully have a say in how Facebook is run.
protomyth 7y ago
It would make for an interesting website: the what-if of Silicon Valley. Another famous one is that Sun could have bought Apple. It was in the intermission between Steve years.

cryptofits 7y ago

If you will look hard enough, you can find FOMO in so many different things. If you were lucky enough to purchase 100 shares of McDonald's when it was at $22.50 on its IPO date, you would have spent $2,250. Based on McDonald's closing stock price on October 28, 2018, the investment would be worth $12.89 million. We can also talk about Bitcoin but I think you got my point

jghn 7y ago
A colleague was big on Bitcoin in mid-late 2009. I declared it to be stupid and didn't bother. By the time I realized that was a mistake it was too late, the days of normal people mining coins was long gone. I've convinced myself that I'd have lost my wallet long before it became valuable anyways. It helps me sleep at night.
- yardie 7y ago
  If it makes you feel any better there were a lot of alt-currencies around that time. Many were marketed as being untraceable to avoid government interference and taxation. And many were used for laundering, drugs, and childporn. Around that time I was aware of bitcoin but I was paid for some dev work once in e-coins and had the hardest time converting that to cash, which is how I paid rent. And while it made up a small part of my compensation I thought it was ridiculous. Something tinfoil hat wearers cooked up. It's easy to say it bitcoin was going to be big, in hindsight. I used one of their early ATMs to pay for pizza. At the time it was trading for ~$2. I didn't think much of it until years later when it got a meteoric rise.
- marvin 7y ago
  Or you would have sold it the moment your holdings had any real value. 99% of all people would have done this. You need a very uncommon «speculator’s» or «investor’s» mindset to be this deep into _anything_ as an individual. If you buy any single asset with the idea that it might increase 10x to 10000x in value, any degree of success will put you in a position where continuing to own it is in direct violation of a «sensible» investment policy.

jcims 7y ago

I could have stuck with my little bitcoin experiment in 2011.

lifeisstillgood 7y ago
Thank you. I have about a dozen different "If only" moments in my tech life, from turning down job offers to not making tech experiments into real businesses (Twitter and Docker, parking payments by mobile and a really good enterprise marketing system) I regret them all because I think they all definitely would have made me bajillions. including leaving running a bitcoin miner machine in the corner of my office instead of turning it into a build server. But frankly I probably would not be a billionaire by now had I done any or even all of those great ideas in hindsight It won't stop me trying for the next one, but it will mean if I duck out with even a small win it's a big triumph
- jcims 7y ago
  The only salve I have to apply for my missed bitcoin burn is the absolute reality that I would have unloaded a thousand of them as soon as they got to be worth a couple of bucks. That would have been way worse.

noego 7y ago

> Randolph writes that he'd been closely watching Antioco during this conversation. Throughout, the Blockbuster CEO appeared as a polished professional, leaning in and nodding and giving every indication of someone who was listening attentively. Now Randolph observed as an odd expression crossed Antioco's face, turning up the corner of his mouth. It lasted only a moment, he writes. "But as soon as I saw it, I knew what was happening: John Antioco was struggling not to laugh." Great article but it seems unnecessary to accuse Antioco of being arrogant just because he turned up the corner of his mouth for a moment. There are tons of investors who pass up on great investment opportunities every year. Most of them aren't arrogant, they are simply normal people who don't have the benefit of perfect hindsight.

FussyZeus 7y ago
And more to the point, success in business is determined just as much by blind luck as anything else. If Antioco had sprung on Netflix, who knows how many other things he might've sprung on too? And even assuming Netflix worked out, who's to say the other investments wouldn't have killed Blockbuster in the process anyway? This whole genre of articles confuses me. Is the message be open to new things? Is it about other investors feeling regret for things they've passed on, or worry about the things they didn't? I don't understand this at all.
- mikeash 7y ago
  Yep, we’d probably be reading about how stupid Blockbuster was for buying Netflix when it was Moovster that kicked everyone’s ass.
- RobertKerans 7y ago
  > This whole genre of articles confuses me. Is the message be open to new things? Is it about other investors feeling regret for things they've passed on, or worry about the things they didn't? I don't understand this at all. Myth-making, mythologising. The genre is "business, but written as adventure/thriller" I guess? Comes across as attempts to imply that it's all epistemological. It's just turning things into a good story though, you're maybe reading too much into it? (Although every one of these I've read seems to go something like: "I should have been terrified. But I was calm, I knew what I had to do. My whole life had been building up to this meeting with Corpocorp. The team was gearing up for the battle that lay behind those huge frosted glass doors. I looked at them, and tears pricked at the corners of my eyes. 'Goddamn' I thought, 'this is the best bunch of guys ever put together for business purposes', and my heart swelled with manly pride. Joe Spiff had been my first hire. He was the best money talker I'd ever met. I looked at him now, laser focussed on the dollar bill held between his fingers. This was his routine, I'd seen him do it a hundred times. He'd sit and stare at that bill for ten minutes, unblinking, not moving a muscle. Then he'd just...crush it between his fingertips, quick as a flash. Lawyerman Pete was [contd.]")

dmitryminkovsky 7y ago

Lycos could have bought Google for 700k. If you bought a share of Home Depot in 1982 you’d be a millionaire. Can’t think of a more banal form of what-if-ism than looking back at missed market opportunities.

overcast 7y ago
You could easily be a millionaire multiple times over working a normal job for 38 years too.
- dmitryminkovsky 7y ago
  Yep!!

jvagner 7y ago

I was part of an e-commerce company selling DVDs in the mid 90s, watching: Amazon enter the space, a bedroom porn operation start to rise in the adult dvd mailing market, and Netflix getting a start. We were ripping the movie trailers off the DVDs and encoding them, streaming them on the product page. All we had to do was rip the whole movie and make licensing deals with the studios we were sourcing our products from, and BAM, we coulda been Netflix too.

jlosito 7y ago
I hear that’s not far off from what these streaming services do in reality.

blantonl 7y ago

I think the part in this article where John Antioco is perceived as arrogant is a little misguided. It's important to remember that a natural gas pipeline company based in Houston was vying to put Blockbuster out of business with their own "Broadband" unit, and it indeed was laughable. And we all know what happened to Enron.

simonebrunozzi 7y ago

Tried to post the same thing a couple of days ago [0], but no discussion happened. [0]: https://news.ycombinator.com/item?id=21010244 https://news.ycombinator.com/item?id=21010244

Causality1 7y ago

Yeah, and we could've all bought bitcoins for pennies when we first learned about them. The biggest barrier to understanding past decisionmakers is that we know how it turns out and they didn't.

pweezy 7y ago

Check out the podcast "Business Wars" by Wondery. They have an 8-episode miniseries on Netflix vs. Blockbuster that I really enjoyed and highly recommend. It includes this story, as well as some of the other competitive developments that, as crazy as it sounds now, at the time almost looked like they would bring a victory to Blockbuster.

oblib 7y ago

My wife, when we first met in the mid-90s, used to get DVDs at Blockbuster and always returned them late and paid the late fees with no complaints, which were huge. The first time I went with her to return some they took her money and then told her she was no longer allowed to rent them there anymore. She was pretty bummed out about that but I was shocked by how much their late fees were and explained to the manager that my wife was paying them way more than their customers who returned them on time and they may want to reconsider. Her response was about as snotty as can be. She said something like "We need them back on time for our good customers". We left laughing because that just seemed crazy and we knew she'd be saving literally $100s per month. But I was puzzled about why they'd do that. It made no sense at all to me. She was giving them a lot more money each month than their "good customers" which I thought should have put her at the top of that list. And the manager, who was so rude, clearly got a sadistic joy out of telling people "No more DVDs for you!" like the "Soup Nazi" on Seinfield. Before we'd met I'd never even been in a Blockbuster so that was my only real experience with them and I remember well thinking their customers would flee like rats from a sinking ship when a viable alternative came out. As soon as I heard of it we bought a Roku and ditched our "Dish" satellite service and after using it I knew Blockbuster was going to take a big hit from that little black box. It was just a few years later I read they were going out of business. By then I'd seen people lined up at "Redbox" dispensers and the Blockbuster where we lived had already closed up. I have to admit that seeing Blockbuster die like that warmed my soul like a bowl of good hot soup

dlp211 7y ago
I think the problem here is that you are assuming that the amount that your wife was paying made up for the lost sales of unhappy customers when titles aren't available. The math is not revenue for someone else to rent at normal rate vs. the revenue for your wife to hold onto the title, but rather the revenue from a customer that keeps coming back vs. the late cost revenue minus the the lost cost customer revenue.
- kshacker 7y ago
  Having seen the rates for late rentals, I think your parent comment is "more" right. Unless blockbuster was running such a tight ship that a single rental's delay would upset the applecart ... but I remember waiting for DVDs and cassettes and unless you hit the sweet spot (a few weeks after the release, or maybe just on the first day of release), there was always a wait and/or the associated frustration.

tempsy 7y ago

GameStop is a very interesting stock bet right now. It could easily go to route of Blockbuster (most obvious route), but it could do so many things to not be another crappy retail experience. Not confident they will turn it around but there's certainly an opportunity for a brick-and-mortar game shop done right.

parsimo2010 7y ago
With GameStop's several year history of bad public opinion and what appears to be decaying market share, I wouldn't bet on it. The current management is clearly willing to accept the status quo and won't take the actions necessary it "turn it around." New management could signal that good changes are coming, but it could also signal that specialists have been brought in to carve the assets up before bankruptcy. I'd say it's far more likely that GameStop ends up like Blockbuster and Sears, even if they potentially could turn things around.
Vadoff 7y ago
If they had the ability to turn it around, they would have... years ago. Unless they get a new CEO/leadership and take radical shifts in strategy, I don't see anything happening.

simonblack 7y ago

"The Innovator's Dilemma." It's been the downfall of many a commercial empire.