Apple didn’t kill HMV—Amazon and HMV did
The BBC asks Can HMV reinvent itself? The famous entertainment group, founded nearly a century ago, is currently, to put it bluntly, fucked. Its stock-market value is now under £50m and the banks are circling like hungrier, angrier, uglier versions of vultures, waiting for HMV to keel over so that they can strip its corpse for money meat.
The BBC gets one thing very wrong, though, when it argues why HMV’s gotten such a serious kicking of late:
Apple—with its iPod and iPad—is the silent white assassin of HMV, because more and more of us are choosing to download music, games and films, rather than buying those silvery discs. And Waterstone’s is being squeezed as we opt to download books on to so-called tablets.
The real assassin of HMV wasn’t silent and it certainly wasn’t Apple. Instead, it was Amazon, blundering into the UK, setting fire to the concept of ‘profit margins’ and undercutting every high-street retailer to the level that it made no sense to buy in a store. Instead, HMV rapidly became a kind of gigantic shop window, where you’d check out stuff you’d like to buy, before returning home and grabbing it from Amazon.
Where HMV then failed was in creating its own online offering that didn’t respond to Amazon (and also the likes of Play.com) competitively. HMV was comprehensively outmanoeuvred on price, and it for far too long welded hefty postage costs to its products.
The one smart move the group has made is in its 50 per cent purchase of 7digital, which may be dwarfed by iTunes but is nonetheless a highly respected online music store, with lucrative deals with Spotify and BlackBerry. But whether this is enough to convince the banks to hold fire is debatable—and that isn’t down to Apple, but HMV in continually reacting after the event, rather than presciently noting which way markets are heading in.
Heear, hear! As a bookseller and former Waterstone’s employee I heartily agree. HMV online has been a much better deal than their high street stores for years. They’ve turned Fopp into HMV overstocks bargain bins.
On the book front, if we don’t have a book in stock, the customer usually says “oh I’ll just buy it on Amazon”. Usually followed by “this shop’s a lot smaller than it used to be – you used to have loads of books! What happened?”
Heear?!?