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While Blockbuster (BBI) was ahead of their time in 1999 and was thinking about a digital media strategy way before consumers wanted the service and the Internet was even able to support it, that foresight on their part never materialized into any real online video strategy over the next ten years. Today, Blockbuster is getting it's head handed to it from Netflix and others who have developed, executed and rolled out online video services with much success, in a very short period of time.

Without a doubt, Blockbuster should have been in the position Netflix is in today as they were the first movers in the market. Yet ten years later, the company still can't seem to get their act together when it comes to digital media. We've seen Blockbuster do wacky things like create in-store kiosks for downloads and their executives have never had a clear strategy for how they plan to take their video business into the digital era. While some might suggest that Blockbuster did have a strategy when they acquired Movielink in August of 2007, the company bought an outdated platform that has yet to be improved upon. The fact that two years after the Movielink acquisition Blockbuster still can't support Mac users with their video on demand offering shows they are still relying on Movielink's outdated technology for their digital media strategy.

Blockbuster is not thought of as a company that has any strategy for digital media and every year, seems to come up with some sort of new idea, like kiosks, only to them change their mind a year later. I've never met, talk to or read an interview with any executive from Blockbuster that makes any clear case as to why anyone should think of Blockbuster as a digital media company. Sure, their executives do a lot of interviews and talk a big game, but it's all marketing fluff. They've never even presented their so called digital media strategy at any industry conference or event, I can't find any white paper on it and no where on their website do they even outline what digital media means to their business.
So talking about brick and mortar stores as an argument as to why their digital strategy is compelling simply makes no sense.

Or how about the fact that to date, Blockbuster's service is not available on any gaming console, which is the number one selling device in the home for the playback of digital movies, outside of the PC. Blockbuster makes a big deal about their relationship with TiVo yet to date, TiVo only has 1.6M stand alone DVRs in the market and Microsoft and Sony combined have sold well over 20M consoles in North America. I love my TiVo, but for Blockbuster to act like having a deal with TiVo is such a big deal, they need to think again.

I realize that Blockbuster has made other deals like the one announced this week with Samsung, but that won't even kick off till later in the year. And even with adding Vizio TVs to the mix, how many of those devices will be in the market in the next few years? While Blockbuster has also rolled out their own device for videos on demand, the MediaPoint set-top box doesn't even come close to the functionality that Roku or others have. Not to mention, you can't even find the set-top-box listed on Blockbuster's home page. You would think that part of their digital media strategy would be to promote their own hardware that allows for digital downloads, but they don't.
Sadly, I don't think Blockbuster will ever be a leader in the digital media arena. While I don't think it's too late in the market, they simply don't have the mentality or the foresight that they showed ten years ago. And while the online video movie industry is still in its infancy, if and when Blockbuster gets their act together, I think the opportunity will have already passed them by.
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