Anti-consumer, anti-worker Circuit City…. are they worthy of your support… or survival?

The recent news that Circuit City was going  to undergo a massive layoff simply so they can replace tenured workers with lower-paid ones came as a shock to many, raising voices of disgust over an action that would make frequently-maligned Wal-Mart blush.   Yet this shouldn’t come as a surprise given some of Circuit City’s eyebrow-raising behavior in the past.   This, the  first of a three-part series on Circuit City’s bad behavior will discuss their fiasco of DIVX,   the most ill-conceived, ridiculous, anti-consumer format ever introduced.


 Circuit City’s Digital Video Express, or in other words, pay-per-view DVD!   You pay and pay and pay…

Circuit City earned the emnity of many an A/V enthusiast with their ridiculous DIVX scheme of the late 1990s.   (DIVX is no relation to the DivX  video compression  format.) DVD was new on the market and home theater fans were excited by the prospect of a new, affordable, compact video format that promised better quality than  Laserdisc.   It also had the promise of achieving wide acceptance, leading towards more  movie choices at lower prices than  Laserdisc, which always remained something of a niche format.    

To the chagrin, anger and revulsion  of all, Circuit City, under the leadership of Richard Sharp, announced DIVX.   DIVX players were DVD players with  a modem that had to be connected to a phone line  that dialed into DIVX whenever you  put a DIVX disc in the player.   To use DIVX you had to have a credit card registered with the system so you could be charged.


You could purchase a DIVX DVD disc for under $10 and watch it for  48 hours the first time you placed in it the player.   If you wanted to watch it again, the player would call up DIVX and charge you a viewing fee, usually $3.25.    



What’s more, if the studio decided they did not want you to watch the movie again, they didn’t have to grant you another viewing period, and prices for viewings could be changed at any time.   It also amounted to a vast invasion of privacy as they could monitor your viewing habits.



Would YOU like to be charged every time you watch a DVD you purchased?   Didn’t think so… and neither did the rest of the world.  


DIVX was called a “feature” by Circuit City  and the players were sold as “DIVX-enhanced” DVD players  .    Under the marketing scheme Circuit City called  DVD “Basic DVD”.   Enthusiasts referred to them as “DIVX-infested” DVD players and DVD as “Open DVD”.   Many of them encouraged a boycott and refused to patronage Circuit City for any reason, as well as the manufacturers who had signed on to make DIVX-infested players.   They saw the bigger picture… if DIVX caught hold, it would ruin the A/V and movie collecting hobby.   Richard Sharp was re-christened “Dick Sharp” by these up-in-arms videophiles and an anti-DIVX movement swept the web, with many barbs pointed his way as he was widely held responsible for this ridiculous, anti-consumer, anti-privacy scheme.



DIVX didn’t survive for long, introduced before the holiday season of 1998 and cancelled in June of 1999.   Enthusiasts, aided by the mainstream media, did a good job spreading the word and keeping the mass market consumer from looking at DIVX as a “feature” as Circuit City wanted.   The banners on this page are a sampling of these efforts, of which I was proud to be a part.   (I did not create banners but I did help spread the word.)


Circuit City lost a ton of money on the deal- $114 million dollars.   Too bad it was not a lot more as they certainly deserved a spanking.

You can read more about it DIVX by following the links below.  Next time, in  part two…  Circuit City fires its most knowledgeable, most successful salespeople… yet another anti-consumer as well as anti-worker move.

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