Netflix vs. Blockbuster: Battle Strategies
TL;DR
Blockbuster's store locations ($2B+ real estate) became liabilities in streaming era
Speed Read
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300 WPM
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Analysis of competitive dynamics between Netflix and Blockbuster, documenting why Blockbuster's regeneration attempts failed despite significant investment. Provides root system incompatibility analysis.
Demonstrates the biological parallel: like trying to regenerate a mangrove after draining the swamp. Blockbuster's capabilities (real estate, inventory management, retail transactions) were liabilities in streaming era, not assets to build on.
Key Findings from Satariano & Ante (2010)
- Blockbuster's store locations ($2B+ real estate) became liabilities in streaming era
- Customer relationships were habit-based not loyalty-based
- Core capabilities irrelevant to digital delivery
- Netflix's convenience advantage accelerated customer exodus