The Decline Of Blockbuster And Rise Of Netflix


Blockbuster’s Bankruptcy

Back in September of 2010, Blockbuster was forced to file for Chapter 11 bankruptcy after failing to compete with the rise of similar companies like Netflix and Redbox. Once a strong corporation that defeated local movie stores, Blockbuster is now being overtaken by the new and more modernized versions of movie rental. The corporation will need many months to recover after dropping to nearly one billion dollars in debt. Blockbusters share of DVD and Blu-ray rentals fell from 25% to 17% in 2011, a sharp decline for a company that once dominated these shares.

Society seems to have shifted from the classic store movie rentals of the past to the current onine rental services of Netflix. The demand for new and modernized technology is on the rise and has caused Blockbuster to become a thing of the past.

Rise of Netflix

Innovation and convenience are key when it comes to appealing to the masses in today’s modernized society. Blockbuster is a brick and mortar, traditional store. It is inconvenient for people to drive to a store to rent a movie when they can simply stream movies instantly through Netflix. Blockbuster requires an account with the store to access their movies, and they charge their customers with late fees whereas Netflix can be held at home with no late fees.

Netflix grew instantly by advertising online and offering free one-month trials to new users of the service. They offer a wide selection of movies and television shows that may be unavailable in a Blockbuster store. Netflix offers these shows and movies to your TV instantly at no charge. In addition, with Netflix you are able to stream movies and shows through your iPhone, Android, PS3, Wii, Xbox, Computer and other devices, something Blockbuster is lacking. At only $7.99 per month, Netflix users are given access to instantly stream thousands of titles. This low price appeals directly to college students who are interested in movies and shows but are on a limited budget.

Comparing the Services

After losing customers to Netflix and Redbox, Blockbuster tried to change up their gameplan. Originally a go-in-and-rent your movie store, Blockbuster mimicked the principles of Netflix with a new instant streaming program. They offered similar, if not more recent and better, titles than Netflix through instant streaming.

Also, they began to mail movies to the customer’s home, much like Netflix. Blockbuster seemed to have a step up on Netflix with this because the customer is able to bring the disc into a store and exchange it instantly if they don’t want to wait for the mail service to deliver. Another perk of Blockbuster is the option for customers to rent video games in addition to their movie selections. Blockbuster has recently taken up the model of Redbox, offering store front rental units. Although they provide similar functionality, the Redbox units still have a larger following.

Even with their attempts to match their competitors, Blockbuster appears to have failed to keep up with the changing times.

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Written by Logan Douglas, social media advisor at

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