BRITAIN'S LAST chain music retailer, HMV, has gone into administration.
No, this isn't deja vu, it's the second time the company has gone under in just six years. Last time, it was rescued by Hilco, a company that specialises in turning around failing companies.
But it seems that the change in the way we consume media in the internet age has proved too much, and despite optimistic projections of increased market share, the poor trading environment over Christmas, and forecasts of a further 17 per cent drop in sales in the sector, HMV was just not viable in its current form.
The stores will carry on trading whilst a potential buyer is found, and to many peoples' surprise, the company has vowed to honour gift cards, though we'd advise anyone who had one under the tree to get it used quickly as these things can change at any time - a new buyer could reverse the decision, as happened with department store House of Fraser.
The fundamental issue is that CDs and DVDs are the solutions to a problem that has ceased to exist. When you can buy or stream anything you want digitally in seconds, the appeal of functional but less romantic formats is diminished. Real collectors flock to independent vinyl sellers for the "big sleeve, big sound" experience.
Although HMV has attempted to capitalise on the digital market, with a mail order business, an MP3 download store and adding gadgets such as Bluetooth speakers and headphones to its roster, the prices simply don't add up and many HMV customers were simply using the shop for "showrooming" before buying the device cheaper on the internet.
The news comes at the end of a poor year for retail, with the tech sector's biggest casualty being electronics retailer Maplin, which has sinced been revived as a web shop, by Dragon's Den stalwart Peter Jones.
As for HMV, it's thought that there is potential to bring it back as a smaller, leaner operation, perhaps with more of the values of its lovablely nerdy sister brand Fopp, which itself was rescued by HMV from administration, and is now at risk along with its parent brand.
However, as we've seen in the past, potential isn't everything, and there is still a good chance that this iconic brand will disappear from the high street, with technology holding the smoking gun. μ
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