Wednesday, September 22, 2010

Blockbuster To Declare Bankruptcy

Not verified, but likely, the news that today Blockbuster will announce bankruptcy. The end of the brick and mortar video store. The rise of digital and on demand. Buy the DVD at Target or Walmart or rent it inside the home. And while Netflix has been successfully transitioning itself to digital, Blockbuster found itself too late to the game. Once the leader and now looking like a footnote in history. Is it Chapter 7 or 13, I haven't heard. But with Blockbuster already closing stores, the end is near.

Is this a precursor to other brick and mortar stores where digital replaces hard copy. Should Game Stop be worried? Is Barnes & Noble on its last legs? The rise of new technology does not necessarily harbor the end of another. For B&N, it is the rise of the Nook. Being on top doesn't mean staying on top. The leader must continue to innovate and adapt or like Blockbuster, they will eventually fail.

Cable companies are facing the same threat from digital leading to cord cutting of cable and phone in the home. The same learnings apply. Innovate, adapt, or else.

Smartphones Leading Way to More Media Consumption

Need to check a sports score, go on your phone. Looking for a nearby restaurant idea, go on your phone. Catching up on Facebook, go on your phone. And in my case, blocked from reading personal emails at work, go on your phone. The cell phone is the connection to media and information, wherever and whenever. Convenient, compact, and always with you.

"And this rabid consumption only stands to intensify as second-generation devices become more ubiquitous. According to the study, 24 percent of people now own a web-enabled smartphone, while cellphone ownership has fallen from 81 percent to 65 percent since 2009." Also worth noting, consumption of media is not a zero sum game; that is, it is not simply being moved from one device to another. We are consuming more because it has become effortless to interact wherever we are. And the variety of content online continues to grow.

"Indeed, the barriers between traditional TV, DVR, and video-on-demand are rapidly vanishing. Watching television live still commands 78 percent of the total hours viewed, but almost a quarter of TV viewing today occurs through a mixture of DVR, VOD, and online video -- an increase of 49 percent year-to-year." This is good news for content creators developing valuable content for TV. That content can now being viewed live on TV, on DVR, through on demand, online, and on DVD.

And smartphones are being made better to support our media requirements. The iPhone from Apple took them a quantum leap forward with it's touch pad concept and now other device makers have followed with their own versions. Still, our next hump to overcome remains the power source. Longer battery life will only lead to even more media consumption.