Incorrect
The answer is B: Blockbuster.
At the turn of the millennium, the start-up Netflix was reeling from the dot-com crash. Its DVD-by-mail rental model was beginning to look increasingly frail. Meanwhile, Blockbuster was the top movie rental store in the U.S., with over a quarter of market share and around 87 million customers. Worldwide, the chain employed over 80,000 people across 9,000 stores and was nearing its peak value of $5 billion. But Goliath rejected David’s deal.
Just 10 years later, Blockbuster had filed for bankruptcy, unable to compete with slicker online services and the rise of video streaming. Netflix, however, had built its subscriber base with instant access and binge-watching in mind. Staying ahead of the curve, the company grew at an astronomical rate during the 2010s. It reinvented itself as a TV and movie studio, creating a one-stop shop for content. By 2017, Netflix had more subscribers than all the cable TV companies combined.
Netflix today has a market cap of $271 billion. Meanwhile, there is just one Blockbuster store remaining, located in Bend, Oregon. Curiously, this store became the subject of a Netflix series.
Amazon offered to buy Netflix for $15 million in 1998, but Netflix’s founders held their nerve. In fact, the meeting with Jeff Bezos persuaded them to focus on rental, as they would never beat Amazon in terms of online DVD retail. At the time of writing, Amazon Prime’s streaming and production service is just marginally ahead of Netflix for U.S. market share.
Correct
The answer is B: Blockbuster.
At the turn of the millennium, the start-up Netflix was reeling from the dot-com crash. Its DVD-by-mail rental model was beginning to look increasingly frail. Meanwhile, Blockbuster was the top movie rental store in the U.S., with over a quarter of market share and around 87 million customers. Worldwide, the chain employed over 80,000 people across 9,000 stores and was nearing its peak value of $5 billion. But Goliath rejected David’s deal.
Just 10 years later, Blockbuster had filed for bankruptcy, unable to compete with slicker online services and the rise of video streaming. Netflix, however, had built its subscriber base with instant access and binge-watching in mind. Staying ahead of the curve, the company grew at an astronomical rate during the 2010s. It reinvented itself as a TV and movie studio, creating a one-stop shop for content. By 2017, Netflix had more subscribers than all the cable TV companies combined.
Netflix today has a market cap of $271 billion. Meanwhile, there is just one Blockbuster store remaining, located in Bend, Oregon. Curiously, this store became the subject of a Netflix series.
Amazon offered to buy Netflix for $15 million in 1998, but Netflix’s founders held their nerve. In fact, the meeting with Jeff Bezos persuaded them to focus on rental, as they would never beat Amazon in terms of online DVD retail. At the time of writing, Amazon Prime’s streaming and production service is just marginally ahead of Netflix for U.S. market share.