Thursday, August 20, 2009

Netflix, FM Radio, and The Big Idea

I came across a story today that made me want to launch a new blog titled 'AheadOfTheirTime' that would be dedicated to all of the inventions and big ideas that came too early to be adopted or even appreciated.

For instance, there's the case of Edwin Howard Armstrong who, in the 1930s, invented FM radio only to have the technology criticized and entangled in patent disputes. Distraught that his idea was not taking hold, Armstrong committed suicide (a college professor of mine once told the class that Armstrong jumped, poetically, from an AM radio tower--alas, according to Wikipedia, he escaped through the thirteenth floor window of his New York City apartment).

And recently there has been a video circulating online of a 1981 KRON-TV news report about a newfangled method for reading the newspaper: on your home computer.

The 'AheadOfTheirTime' piece that I came across today is the story of one man's mission to build Netflix. In 1987.

The Consumerist picked up a story yesterday from a blog called HackingNetflix: In 1987, a company called Video Mailbox (they used spaces in names back then) debuted a VHS rental-by-mail service in which the customer paid a flat monthly fee to rent as many movies as he wished. According to Video Mailbox's brochure, the customer filled out a "Favorite Fifty List" from their catalog of 10,000 titles and then the company would ship two sets of videos at a time, along with the necessary return postage, for a monthly fee of $29.95. The brochure even promotes a free, no-obligation, one-month trial.

The method, promotion, and pricing structure is so close to Netflix that one does begin to wonder if this is just an elaborate hoax. According to HackingNetflix, though, there was a Video Mailbox trademark filing in 1987. There's even a commercial for the service that predicts the demise of video stores...

The story of Video Mailbox goes to show yet again that in entrepreneurship, execution, timing, and luck matter just as much--if not more--than The Big idea.

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