Netflix has always been a thorn in Blockbuster's side. For years now, the company has found creative ways to shape new business models and generally make Blockbuster look old, ragged, and incredibly foolish.
And although it was facing serious financial issues that required it to close hundreds of stores and layoff thousands of employees, Blockbuster has turned things around as of late. In the last two quarters, it enjoyed a slight profit of about $40 million in each period.
With that in mind, I was under the impression that things were finally turning the corner and it would have the ability to realize that the future of its business isn't in the brick-and-mortar, but in the wide world of downloads. And although its stock price is laughable and its foolhardy decision to go after Circuit City made it look desperate, I thought Blockbuster would finally wake up and get to work on something worthwhile.
Evidently, I was wrong.
Instead, it's (once again) Netflix realizing that the future of the the rental business isn't in the brick-and-mortar and probably not even in the mail sector. It's Netflix that's adapting to the changing times by streaming movies and TV shows to its Roku box and, now, the Xbox 360.
And in one fell swoop, Netflix has once again made Blockbuster irrelevant.… Read more