Reel.com

» see reel.com as it lived, on the wayback machine

~ the obit ~

In 1998 an American website would sell you a videotape and put it in the post. From where i was sitting that was not a transaction that existed. It needed a credit card most households did not have, and a customs process that cost more than the tape was worth. Reel.com was aimed at somebody with a mailbox in California and a phone line good enough to load a page full of cover art. The phone line i had was 33.6k. Nothing else on that list was ever turning up.

The company was started in september 1996 by Stuart Skorman, who had spent the eighties running a video rental chain in New England and writing film recommendations on note cards to stuff into the tape boxes. Customers kept coming back for the cards more than for the tapes. Reel.com was the note cards turned into software, a database of reviews with a matching engine that took what you had liked and suggested the next thing. The site went live in january 1997.

Skorman worked out quickly that nobody would pay for recommendations, so in april 1997 he bolted a store onto the front of them. It listed 35,000 titles to rent and 85,000 to buy, roughly five times what the video store down the road could physically hold. Sales went from $745,000 across the whole of 1997 to about a million dollars a month through the first nine months of 1998. One of the heaviest customers turned out to be Paul Allen, who then became an investor alongside Intel.

Hollywood Entertainment, the chain behind Hollywood Video, bought the company in 1998 for $96.9 million, a third of it in cash. The deal closed that october. A month later Amazon added video to its catalog and inside forty-five days it was the largest video retailer on the web. Everything after that is a price war Reel could not win. It lost $98.5 million on $40.2 million of sales in 1999, thirteen cents gone on every dollar taken before anybody was paid. On 19 june 2000 Hollywood shut the store and laid off all of it.

~ the rap sheet ~

~ what it actually sold ~

Renting a film by post in 1997 meant ordering two or three days ahead, paying $4.50 and later $5 plus shipping, then mailing the tape back. The corner store charged $3 and was open now. Skorman always treated the rental side as a stopgap until films could be sent down the wire instead, which was the correct guess and about a decade early.

Julie Wainwright arrived as chief executive in march 1998 and killed the rentals so the site could concentrate on selling. Her other move was Titanic at $9.99 against a recommended price of twice that, losing around six dollars on each of some three hundred thousand tapes and buying a great many customers who had come for exactly one thing. She clashed with the new owners and left in february 1999, and went to Pets.com.

~ the cracks ~

The technology underneath was never any good. Skorman has said the site crashed daily through its first six months, sometimes dozens of times a day, and that one failure lost five thousand orders. His older brother flew in from a psychotherapy practice in New York one week a month to act as unofficial chief technology officer. Express ordering, the feature that lets a returning customer avoid retyping an address and a card number, did not arrive until august 1999.

Hollywood spent heavily to fix all of it and the fixing worked, which is the sad part. Staff went from 115 to 174 over the first nine months of 1999 and the site finally became reliable. By then the market had decided that e-commerce without a route to profit was not worth funding, Hollywood's own stock was down 75 percent because investors could see Reel dragging on it, and the money to keep going was gone.

~ the long tail ~

The store closed but the site did not. Hollywood kept reel.com running as a movie information site, sent anyone who wanted to buy something over to Buy.com, and held onto the name as a possible front end for video on demand whenever that finally arrived. It was still publishing reviews in 2006, still doing the thing Skorman built first and never found a way to charge for.

Hollywood Entertainment was sold to Movie Gallery in 2005, and Movie Gallery was liquidated in 2010. The reviews stopped somewhere in there. By 2016 reel.com was a holding page belonging to a domain management firm, which is where a name goes when it is worth keeping and not worth using.

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