Blockbuster Still Chasing Netflix

Peter : On Rad's Radar?
| Peter Radizeski of RAD-INFO, Inc. talking telecom, Cloud, VoIP, CLEC, and The Channel.

Blockbuster Still Chasing Netflix

There's a lesson to be learned from Blockbuster. Blockbuster was the last standing national chain of video rental shops. It was purchased by DISH Network out of bankruptcy. Blockbuster was an example of a company that couldn't keep up with changes in its sector - and let rivals dictate the playing field.

Blockbuster started doing the mail order DVD on a monthly basis when Netflix started gaining ground. One thing that Netflix had was an efficient distribution system for both physical DVD's and for streaming (using AWS) -- something that Blockbuster did NOT have. It's sunk costs of doing business were huge. Brick-and-mortar usually is. Ask Borders.

Now Blockbuster is launching a streaming service, according to Bloomberg. This time not just chasing Netflix but Hulu as well. The key may be that Netflix lost Starz and Blockbuster may have it. We'll see next month.

The only novel thing that Blockbuster has done isn't even novel. Setting up Blockbuster Express kiosks was their way of chasing Redbox.

We see this a lot in telecom. Chasing the competition. It's so me-too that most people can't tell you why CLEC A over CLEC B over the ILEC, except on price. (This contributes to an industry consolidating and mounting massive debt.)

How come no one chases a vertical? Inphonex CMO Matt Bramson and I have spoken about this in the past. As voice is just an application (software), why aren't the VoIP Providers working with vertical software companies to integrate their bundle?

For example, dental practice management software with scheduling app plus VoIP and email. A real bundle would include private networking to the data center for the PMS plus access to payroll and credit card processing. This is a solution. And with over 300K dentists out there, even 10% is a great business.  (Many VoIP providers don't even offer email?!)

There are of course other verticals.

You can't be chasing the competition.

The landscape in VoIP is evolving. The network operators are coming to market with Cloud Communications - XO, Comcast, Cox, Windstream and CentruyLink. This means that either you shift your game or end up a commodity provider (where the scale and network of your competitors will eventually kill you).

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