The Blockbuster vs Netflix Twist

In 2000, Blockbuster had the chance to buy Netflix for fifty million dollars.

They laughed them out of the room. But here is the twist nobody

talks about. Blockbuster actually had the better business model. They were printing

cash from late fees alone. The real killer was not technology. It was that

Blockbuster was a franchise system. When corporate tried to eliminate late fees,

franchise owners revolted. That was their profit. Netflix could pivot instantly.

Blockbuster had to negotiate with thousands of owners. The lesson is about how corporate

structure can be your biggest competitive disadvantage.