I have be reading lots of messages with people reminiscing about the past, and how the internet had killed both companies – some blamed changes in customer sales patterns, others piracy. Those views may be true, but the elephant in the room is this – why did they not figure this out and react accordingly?
I am astonished that both Blockbuser and HMV do not dominate the internet delivery of films and music today. They really should. Instead their shareholders are holding their heads in their hands.
A decade ago, both HMV and Blockbuster had
1) Enough resources to make internet domination happen.
2) Smart advisors who would have made these recommendations.
3) A brand that customers would know and trust.
4) And certainly with Blockbuster, probably the biggest database of paying customers in the country.
So how then could both companies being going to the dogs this week? How could they blunder so spectacularly.
Greed and cowardice.
I have seen it before and I am sure we will see it again.
At the top of the pyramid, people often think that their companies are too big to topple, that what they have works so well, and if it ‘aint broke, don’t fix it – CEO’s can always move on to newer pastures and leave the sinking ship. The powers at +HMV and Blockbuster UK were probably afraid too that if they modified their model too much, they might fail, even get fired by the shareholders – again fear of losing money and market position.
Better to relax on the yacht, sip champagne and enjoy the good times while they last.
Yes I know we have twenty twenty hindsight, and yes I am peddling a horrible cliché about corporate bosses that is most likely unfair. And to be fair to them, those good times probably lasted a good decade as it would have been around ten years ago when real rumblings of massive change were becoming impossible to avoid – I can see why that was more attractive than re-inventing and re-investing in an unproven new world.
At some point around 2002ish, there were board meetings and strategy sessions when the powers that be said ‘No, we are not going to invest in the internet as the future for our business…’ And this week we see the result of those choices.
So let’s not shed a tear for HMV and Blockbuster who both sat on their hands (though of course we should for the staff, shareholders and customers caught in the crossfire). It seems to me they had it coming, they stuck their heads in the sand and they chose to continue business as usual as their ship began to sink.
Onwards and upwards!