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The revival of Blockbuster?

Rumors of a possible buyout of the video club chain have roiled the entertainment industry. In an appeal to nostalgia, many fans want the chain back in the world of movies.

8 February 2022

News of Blockbuster’s possible revival has left no one indifferent. Rumors of a buyout of the video club chain, which opened its first store in Dallas in 1985 and grew to more than 9,000 locations worldwide, have been gaining strength recently. This seems striking at the very least at a time when no one would dare to question the absolute market ascendancy of streaming platforms.

A few weeks ago, a group of investors on the BlockbusterDAO Twitter account launched a thread announcing their intention to buy the brand that is considered iconic in the entertainment industry. The goal is to wrest Blockbuster away from Dish Network, the largest pay TV provider in the United States, which acquired the video club chain at auction in 2011 for the non-paltry sum of US$320 million.

The plans. The investors want to buy the video club brand using a system known as DAO, which stands for Decentralized Autonomous Organization. DAOs are communities organized around blockchain technology, which has experienced a tremendous boom this year thanks to the explosion of the cryptocurrency market. The proposed price is US$5 million. The idea is to relaunch Blockbuster as a movie company, but by means of a decentralized streaming service. “It’s time to release the brand from purgatory and give it a new life. A people’s brand should be owned by the people and governed by the people. Even the Blockbuster name lends itself to becoming a Web3 product,” BlockbusterDAO wrote in a Twitter thread that was picked up by The Block Crypto media outlet.

An appeal to nostalgia. The idea has taken on a life of its own due to its appeals to nostalgia, which is regarded as one of the best marketing resources of recent times; one that has worked well with the return of items such as vinyl records or cassettes. The fact is that in the ’80s and ’90s, renting a VHS was the only way to have access to a movie that was no longer playing in theaters. Besides, hanging out at the video club had a certain charm, excitement, and was even a cool thing to do, as opposed to simply pressing a remote control button and watching an on-demand movie.

The last existing Blockbuster brick and mortar is a franchise store located in Bend Oregon, United States. It is a vintage icon that is still renting VHS tapes from its 22,000 unit library after all these years.

Reinvent or die. The history of the video club chain is one of the best business case studies about the consequences of not adapting to changing times. In 1997 an online DVD rental company began to grow: Netflix was born. Three years later, its owners offered to sell their company to Blockbuster for US$50 million, but the video club chain turned down the offer. Thus, while streaming platforms began to grow and gain traction in the market, Blockbuster’s inability to reinvent itself led the company to bankruptcy.