The guardian of DVD groups and the Columbia House audio said it plans to market its Columbia Home DVD Club company, which offers registered tv-series and films straight via a bankruptcy market, to customers.
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In the late 1990s, the mail-order Columbia House Music Club was damaged by Napster, the first major site that allowed people to share their music for free, followed by Napster’s rivals and successors.
Round the same period, online areas like eBay and Amazon.com took off and unlimited DVD accommodations were provided by Netflix through the email. Big retailers like Wal-Mart, Target and Costco were also expanding rapidly.
One such service, Columbia House, used to be one of the top sellers when it came to CD mail orders.
Inside a couple of years, Amazon and Apple would reveal loading choices that did away with actual media completely.
The New York-based parent company, Filmed Entertainment, says its revenue rose to $1.4 billion in 1996 and fell nearly every year after that. By 2014, the company’s revenue had dropped to $17 million.
A once-popular music club that offered members vinyl, cassettes and compact discs, Columbia…
The company’s business model uses a method called the “negative option cycle”.
Despite its popularity and seemingly irresistible deals, Columbia House eventually became reviled for the terms concealed in its fine print: Though members could nab a stack of albums for 1 cent, they had to buy additional albums over time – at a high markup and with exorbitant shipping rates – to fulfill the membership agreement.
Former Columbia House art director Mark Rubenstein commented on the company’s financial status by saying, “The thing I remember most is their unwillingness to change with the times”. It reports about $2 million in assets and $63 million in liabilities like pension and royalty costs.
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The Chapter 11 petition was filed in U.S. Bankruptcy Court in Manhattan.
