Two former UK entertainment distribution giants went into administration earlier this week, sending shockwaves through the retail markets. However, what does this mean for independent film distributors who rely on these companies to stock their (otherwise) little-known straight-to-DVD titles?
HMV and Blockbuster UK have been at the forefront of film distribution for decades; both commanded huge influence and respect during the 90s but sadly neither adapted quickly enough to compete with the emerging online markets and have consequently become the latest casualties of the retail business.
From Digital Spy
The company’s board of directors met earlier this evening (January 14) to discuss their options, following failed requests to the firm’s suppliers for £300 million in additional financing. It was hoped a third party would come to the rescue.
A HMV statement said: “The board regrets to announce that it has been unable to reach a position where it feels able to continue to trade outside of insolvency protection.
The 91-year-old chain faced difficult trading conditions at Christmas, owing £176 million to banks and experiencing a sales slump due to competition from online retailers.
HMV championed independent releases, and in doing so became an integral buyer for small independent distribution companies, who’s primary source of income is DVD sales. Unlike the online retailers, who naturally put larger emphasis on the big-budget blockbusters, HMV took pride in giving independent releases a chance within a very competitive consumer market.
Another retailer, GAME, have recently announced that they are considering the acquisition of 40-45 HMV stores nationwide, which will represent a huge downsizing of a company that currently boasts 238 stores in the UK.
The long-term effects for independent film distribution are currently uncertain, but when two major buyers simultaneously enter administration, the sellers will be hardest hit. This will mean that fewer films achieve worthwhile distribution deals, and consequently, countless production companies will struggle financially and may be forced to distribute independently.