Former Blockbuster CEO tells his side of Netflix story
New documentary serves up some anecdotes about the rivalry, including one about the time former Blockbuster CEO John Antioco mailed Netflix chief Reed Hastings an actual kitchen sink.
One of the best stories in digital entertainment during the past decade was how Netflix wrested control of the home-video rental market from national chain Blockbuster.
Some of the main players in that race, including John Antioco, the former Blockbuster CEO, have been interviewed for a revealing new 30-minute TV documentary produced by Bloomberg.
It's a tale told by insiders of the emergence of Netflix and the Internet as a means of video distribution. Netflix CEO Reed Hastings is known for being squeamish when it comes to talking about himself and he declined to participate, but some of his former lieutenants did.
Here are a few tidbits from the show:
Antioco and Hastings held a secret powwow at the Sundance Film Festival in 2007, where Hastings offered to buy Blockbuster Online, the company's answer to Netflix's DVD-by-mail rental business. Antioco informed him that he preferred the two companies merge. According to the show, the deal was never completed because of antitrust concerns.
By that time, it was obvious that Netflix and the DVD-by-mail business model would triumph over the larger Blockbuster/brick-and-mortar approach. In 2000, Antioco had dismissed Netflix. Hastings had flown to Dallas and met with Blockbuster management to propose Netflix run their brand online. Antioco's people laughed at them.
But by 2004, Antioco and Blockbuster knew they were in for a fight. In 2005, Blockbuster Online engaged in a price war with Netflix, as well as with Wal-Mart's competing service. In a conference call at the end of the year, Hastings told analysts that Blockbuster was throwing everything at them but the kitchen sink.
The next day, Hastings received a kitchen sink from Antioco.
On camera, Antioco, who was out at Blockbuster by 2008, said: "At that point the rivalry was definitely established."
It didn't last long. Netflix went on to help dismantle traditional video-rental stores. The company is now leading the sector's move into streaming video over the Internet and is worth billions. Blockbuster filed for bankruptcy protection and was recently acquired for $320 million by Dish Network.
You can check out the documentary here.