Another business model under threat

October 27th, 2004

WHAT KEEPS THE FOLKS AT BLOCKBUSTER VIDEO UP LATE AT NIGHT? HINT, IT'S NOT COUNTING THE LATE FEE RECEIPTS – If there were any doubts that the video rental marketplace is coming to an end, cable giant Comcast and the children's programming impresarios at PBS and Sesame Workshop have put it to rest in a deal announced early this morning.
The deal, which also includes London-based HIT Entertainment, will form – as previously announced – a 24- hour digital cable TV channel for preschool children. While that should give everyone from Disney to Discovery Networks to Nickelodeon fits, it is not what will have the marketing team at Blockbuster staying up late at night making copies of their resumes at Kinkos.
That will be caused by the second part of the venture's announcement: to form a companion video-on-demand (VOD) service aimed at preschoolers.
The VOD service, which launches in early 2005, will be available to any cable operator in the United States and will offer more than 50 hours of programming for preschoolers. The reason this represents a threat to the Blockbusters of the world is that kids – especially the kind of wee little tikes that watch PBS Kids and Sesame Workshop's programming – are the same ones that drag parents, grandparents, aunts, uncles, and babysitters to the local video chain.
If they can get the same immediate gratification of accessing digital quality videos right on their TV sets, well then they may just skip the trip to the video store, where parents, grandparents, aunts and uncles, and babysitters might also pick up some grown-up entertainment, not to mention some Junior Mints, Cracker Jacks, and one of those microwaveable tubs of Blockbuster popcorn. Okay, so they still have the helium balloons. Pop!

Via Media post
Additional reading: The end of the TV schedule
Imagine there is no internet
Broadcast TV Model Faces Irrelevancy

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