Business Wars

Netflix vs Blockbuster - Origins | 2

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Feb 6, 2018
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ANECDOTE

Rejected Buyout Despite Bringing The Offer

  • John Antioco brought Reed Hastings' buyout offer to Blockbuster's board but planned to reject it privately.
  • Antioco hoped Netflix would 'wither and die' rather than be sold to Blockbuster.
INSIGHT

Scale Was Necessary To Stop Losses

  • Blockbuster needed five million subscribers to break even because in-store swaps were costly.
  • Growth momentum mattered more than an immediate sale at that point for Antioco's strategy.
ANECDOTE

Blockbuster Copied Netflix's Model

  • Blockbuster launched a near-identical website that copied Netflix's interface and pricing and used coupons to lure customers.
  • Evangelist's team even sent spies into Netflix distribution centers to study operations.
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