HMV and Blockbuster Going Into Administration

Thursday, 17/01/2013 - In the news this week is the news that both HMV stores and Blockbuster stores have both gone into administration. HMV have suspended purchases online forcing the administrators to close down their website hmv.com until further notice. Dispite Blockbusters also going into administration their website is up and running so therefore customers can still purchase items online for the time being.

Blockbuster:

With Blockbuster going into administration this week they have put almost 4000 jobs at risk because of recent events. The reason for Blockbuster going into administration is due to the rise in Digital Distribution Services such as Netflix. Netflix and Blockbuster are the same, attracting the same audiences. But Netflix appeals to the more niche market whereas Blockbuster only has a limited amount of shelf space, Netflix doesn't. This ties in with Chris Anderson's Long Tail Theory. Netflix's customers can get instant access to any film on the market instantly for a £5.99 a month subscription. Blockbuster members would have to commute to a Blockbuster store which takes longer on the other hand Netflix subsribers are attracting more people because of it's instant service which can be used from the comfort of your own home.

HMV:

HMV is the last major high street music chain left. And it has currently this week gone into administraion. This is bad and disappointing news which again threatens the jobs of thousands of people across and the last remaining major high street music chain is on the verge of exstintion. Although the fact that HMV has gone into admin doesn't come as much as a shock, as similar stores such as Zavvi and Virgin Megastores have had the same issues and now do not exist. These shops are where most people bought their very first albums from here. I bought my first album from Zavvi in 2007 and the album was Infinity on High by Fall Out Boy, and now it does not exist. Some people will have never heard of Zavvi and it was one of the major music chains on the high street at the time. All of this is due to the massive rise in digital media services such as iTunes, where music lovers can pay a very same amount for albums and individual songs instantly.