Technology Killed the Video Store

Do you remember when “Video Killed the Radio Star (♫) “? As classmate Angelica Cabrera touched on in “Is the Internet killing television“, more and more Canadians are watching TV shows or movies online now. This sudden transition from renting hard copies of videos to streaming them over the internet was detrimental to some companies, such as Blockbuster, and advantageous to others, such as Netflix. As Cabrera goes on to say, consumers are switching methods because of simplicity. It all boils down to an economic debate over opportunity cost. By simply streaming content over the internet, one avoids travel time going to the video store and back, the gas consumption from a vehicle and many other factors that build up over time. Although Netflix is number two in video subscription, behind Comcast, the company is synonymously known with the downfall of Blockbuster. This is due to the precise brand positioning Netflix created, which happened to fill the weak spots of Blockbuster’s brand position. The main Point of Difference is convenience to use and unlimited downloads for a flat rate. The breakdown of the companies can be seen in further detail with this info-graph:

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