business news in context, analysis with attitude

by Kevin Coupe

The satirical website The Onion had a terrific piece this week that was, in addition to being very funny, also made a serious point about the ways in which the retailing world has changed.

The story went like this:

Officials at Netflix announced Thursday that the company has finally reached its long-term goal of constructing a chain of easily accessible stores.

"Having actual physical locations was always our ultimate intent, and we are proud to provide our customers with the convenient option of driving to a nearby Netflix store and renting any available movie for just $3.99 per title," said Netflix spokesman Henry Regis, adding that the ease of physically walking through aisles and picking out DVDs will more than make up for the stores' minimized selection of titles.

"We will also be implementing late fees to help ensure films are returned on time—that way no one misses a chance to rent the hottest new releases." Regis confirmed that the new physical locations will be open from 10 a.m. to 8 p.m. and include easy after-hours drop-off boxes.

Now, that’s funny. (I just wish I’d thought of it first, and used it on April 1.)

But the sad fact is that every once in a while there will be a serious report about speculation that Amazon might be interested in acquiring a company like Borders or Barnes & Noble, or might be intent on finding a use for all the Blockbuster sites that are about to come on the market.

Which just goes to show how short-sighted some people are, or how rooted they are in old-world business models that are on their way to obsolescence.

Companies like Netflix and Amazon were founded, and continue to be successful, on the premise they were going to disrupt traditional and vulnerable business models. It’s not like Reed Hastings and Jeff Bezos - the two companies’ founders - were looking to mark time before taking on the trappings and limitations inherent in these old world models.

No, they were looking to blow the old models up.

People rooted in traditional models need to wake up, to open their eyes. The “ultimate intent” of companies like Netflix and Amazon is to move forward, not backward ... and that ends up leaving a lot of traditional thinkers in the dust.
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