In his Penguin Press bestseller, No Rules Rules: Netflix and the Culture of Reinvention, Netflix Co-CEO Reed Hastings has recalled a 2002 meeting with the top executives of now-extinct video-rental chain giant Blockbuster, which included then Blockbuster Chairman and CEO John Antioco, during which Hastings said he offered to sell his nascent DVD-rental-by-mail startup for $50 million.
Hastings described himself as "crestfallen" by Antioco's rebuff, but also wrote, "Little by little, the world changed and our business stayed on its feet and grew ... By 2010, Blockbuster had declared bankruptcy."
Antioco's response in a LinkedIn posting rendered earlier this week? "That didn't happen."
"While I was not present at any meeting with Netflix where the subject came up, Netflix executives did visit Blockbuster to pitch a licensing deal and, supposedly at an impasse in those discussions, made an off-the-cuff offer to sell their company," Antioco writes. "However, and more importantly, I can say with certainty there were no serious conversations about our buying the nascent Netflix business twenty years ago. Even if there had been, no one, including Netflix, thought their company was worth anything close to that valuation. As Reed Hastings, Chairman and CEO of Netflix, later recalled, his company’s losses in 2002 alone were $57 million."
(Hat tip to the Digital Entertainment Group's "DEN" newsletter for unearthing Antioco's social posting.)
Antioco did concede that M&A discussions between Blockbuster and Netflix did occur several years later, after the brick-and-mortar chain made several key improvements to its Blockbuster Total Access online rental service and started to peel internet-based market share away from Netflix.
"By early 2007, the success of Blockbuster Total Access did trigger serious M&A discussions between the two companies," Antioco said. "Shortly after those conversations, for a variety of reasons, I left the company, and subsequent Blockbuster management had no interest in the online rental business.
Meanwhile, citing an April TikTok posting from Netflix Co-Founder Marc Randolph, Antioco added, "By the end of the year, Total Access was no more, and as Randolph says in his TikTok, Netflix 'got one of the luckiest breaks in corporate history.'”
