History Daily - The First Blockbuster Video Store

Episode Date: October 19, 2026

October 19, 1985. The first Blockbuster video rental store opens in Dallas, Texas. Support the show! Join Into History for ad-free listening and more. History Daily is a co-production of Airship and Noiser.Go to HistoryDaily.com for more history, daily.

It's the fall of 1977 at the video station, a small store in West Los Angeles, California. George Atkinson stuffs $20 into an already overflowing cash register as another satisfied customer leaves the store. George has run a business from this location for several years, renting out Super 8 movies and projectors for kids' parties. But he's recently come up with a new and far more profitable idea. Last month, he spotted an advertisement in the TV Guide, inviting readers to join the Video Club of America. For an annual fee of $10, members could order movies on video cassettes through the mail for $50. Consumer VCRs had been on the market for a few years, and George knew they were becoming more popular.

But his experience with Super 8 movies made him wonder if people would be more interested in renting cassettes than buying them outright. So he posted an ad of his own in the Los Angeles Times under the title Video for Rent. George didn't even own any video cassettes yet. He just asked people to send in a coupon to express their interest in the idea, and a thousand movie lovers replied. Knowing that demand was out there, George launched his video rental club. The price list was a mirror image of his inspiration. For an annual $50 fee, members could rent movies at $10 a day.

He bought two copies of 50 different titles and then reopened his store under a new name, the video station. And as far as George knows, it's the first video rental store in the entire country. And it's proving more popular than he ever imagined. As his latest customer drops four VHS boxes on the counter, George realizes that his limited stock won't last long. He's going to need to buy more movies. And from the look of the line that's forming on the street outside, he's going to need a bigger store.

as well. George Atkinson won't go back to renting out just Super 8 movies and projectors. His future will be in video cassettes. After his first video rental store takes off, he'll turn his idea into a profitable franchise. But with that success will come competition, and one rival store named Blockbuster Video will go on to corner the rental market after it opens the doors to its first store on October 19, 1985. Hello, History Daily listeners. A live show I've been telling you about for a few weeks has a new date, October 23rd at the Plaza Theater in Garland, Texas. This is my Days That Made America Tour, a thrilling evening of

history, storytelling, and music with me and a band live on stage. So if you're in the North Texas area or anywhere close, be sure to come out and see me live. More shows will be announced soon, too. So for information on tickets and upcoming dates, go to historydailylive.com. That's historydaily Live.com. Come see my Days at Made America tour live on stage. Go to Historydailylive.com. History is made every day. On this podcast, every day, we tell the true stories of the people and events that shaped our world. Today is October 19, 1985, the first blockbuster video store. It's October 19, 1985 in Dallas, Texas. eight years after George Atkinson opened his video rental store.

Former software engineer David Cook stacked shelves in the first retail store he has ever owned. But instead of selling boxes of cereal or clothing goods, David is lining his shelves with over 8,000 video cassettes. David places the final VHS box on its shelf and then turns to his wife Sandy with a smile. Everything's ready, from the stock to the staff and the yellow and blue signs that proudly display the name of their new business, Blockbuster. So David gives Sandy a nod, and she opens the doors. Their journey to this moment began two years ago, back in the fall of 1983, when David's first

business wasn't doing so well. His company provided software to the oil and gas industry, but a downturn in that sector had hit David's business horn. Fortunately for him, he'd already earned millions of dollars by that stage. But rather than put that money back into the business, the company and tried to ride out the storm. His wife Sandy suggested they start a different kind of business, video rental. When he heard this, David was intrigued. The video rental market had grown exponentially in the early 1980s, and it was already worth a billion dollars a year with no sign of

slowing down. And the more he looked into it, the better the opportunity looked. This billion-dollar market mostly consisted of small family-run stores. They had none of the efficiencies of scale or the computerized inventory systems found in more developed retail markets. So there was a clear vacancy for a dominant national chain, and David intended to fill it. So he and Sandy invested hundreds of thousands of dollars in this new business. They built up a vast inventory of movies and used David's software background to develop new systems for keeping track of them. They plan to open the store from 10 a.m. to midnight and let customers keep their movies for three nights. And all throughout their guiding principle was making their video rental store the biggest and the best in the country.

And if the line of people waiting outside on the first day is anything to go by, David and Sandy have achieved exactly that. Customers stream in as soon as Sandy opens the door. With thousands of titles to choose from, some of them spend hours just browsing, turning the boxes over in their hands, pouring over the descriptions of the movies. Other customers know exactly what they want and hurry their videos to the counter. David is surprised to see many of his new customers want to rent three or four titles at a time. So David has kept busy at the cash register, while Sandy takes the time to find out what people think of the new store. Everyone she speaks with talks positively about the eye-catching branding, with its epic-sounding name and bright blue and yellow color scheme.

Most of all, they love all the choices. There are far more movies available at Blockbuster than any other store they visited in the past, And unlike those smaller competitors, where the cassettes are usually kept behind the counter, here they're displayed on shelves like a bookstore, making it easier and more fun to find the right movie to watch. By the afternoon of the first day, the store is so busy that David and Sandy have to lock the doors and start letting customers out before new ones can come in. And even with their huge movie inventory, they still find themselves apologizing to customers who have missed out on the latest releases.

But these are all good problems to have. When they finally close the doors that night, both David and Sandy know they're onto a winner. And with the Dallas store as a successful proof of concept, David immediately begins to think about expansion. Within a year, he's opened three more Blockbuster megastores. He dreams of creating a nationwide franchise, essentially selling the Blockbuster brand and its inventory systems to individual entrepreneurs across the country. But another ambitious businessman will soon come knocking on David's door with a very different vision for Blockbuster's future, and it's one in which David will no longer have the starring role. It's February 5, 1987, on a plane in the skies above Texas, 16 months after David and Sandy Cook

opened the first Blockbuster store. Sitting in a business class seat, 49-year-old entrepreneur Wayne Heisenga flicks through a folder of spreadsheets and projections. It's a bumpy flight, and as the plane rocks up and down, Wayne's accountant in the seat next to him drips the armrests a little tighter. But Wayne is unsympathetic and thrusts a piece of paper in front of the accountant. The document details the finances of the Blockbuster Video Rental Company. Wayne likes what he sees. It's a popular brand with an ever-increasing market share,

and he's convinced it would make a good investment. In between jolts of turbulence, the pale-faced accountant looks over the file. He isn't so sure. He remembers an article in the Financial magazine Barrens that cast doubt on Blockbuster's prospects. Its concept is too simple. It would be easy for another bigger retailer to copy it. And besides last year, it seems the company actually made a loss.

With a derisive shake of his head, Wayne snatches the papers back. In his mind, finance journalists and accountants don't have the right instinct, and his gut is telling him that Blockbuster has huge potential. Wayne has made a fortune by following his gut. He started in the waste disposal business in Florida. Back in the late 1950s, he had just a single garbage truck and spent 10 hours a day personally collecting trash from his clients. But he expanded aggressively by taking over rivals, as many as 90 and won nine-month spending spree. So by 1982, his company Waste Management Inc. was the largest waste disposal company in the world.

Two years later, Wayne sold his stake with a business valued at $3 billion. But even after this lucrative payday, Wayne didn't take early retirement. Instead, he began hunting for his next project. And around the same time that Wayne left waste disposal behind, the video rental market became a multi-billion dollar industry. David Cook's Blockbuster chain is now one of the largest players. It's expanded rapidly beyond its initial base in Texas and now owns 15 megastores outright with a further 20 franchise stores across the country.

That sort of growth is exactly what Wayne Heisenga has been looking for. So even though he doesn't own a VCR himself, Wayne has arranged a meeting with owner David Cook to see if there's an investment opportunity. After they land in Dallas, Wayne and his accountant jump in a taxi from the airport and visit David and his team at the Blockbuster Warehouse. After introductions, David offers them an insider's view of the organization.

Wayne likes what he sees during the tour, the computer software tracking the inventory, the mass of titles that can be rolled out to any store with the Blockbuster, name. He likes the brand's broad appeal as well. While some video stores rent adult titles out of cornered off back rooms, the cooks have opted to make Blockbuster a family-friendly business. Wayne is no prude, but he understands that's the best way to mainstream success. So before the tour is even over, Wayne is convinced that Blockbuster is the business for him. Over dinner that evening, he and David hammer out a deal that will give Wayne a controlling

stake in the company in return for $18 million. The plan is initially for David to remain involved with Blockbusters, but the two men soon clash over the direction of the business. Wayne wants to move away from the franchise model and build more company-owned stores as quickly as possible. He plans to finance the expansion with debt. But David is more cautious, and it's a fundamental clash, a battle that ultimately David can't win. So instead of fighting it any longer, he decides to sell Wayne his remaining shares for $12 million. So now, with complete control of Blockbuster, Wayne continues with his plans for rapid expansion. Acquisition after acquisition sees small mom and pop outlets become blockbusters.

Entirely new stores are built all over the country. And then in 1989, the company goes international, opening its first stores in Britain and Canada. This rapid growth will continue into the 9th. and at one stage, a new Blockbuster store will open every 17 hours. By the middle of the decade, Blockbuster will be a billion-dollar rent of prize at a household name all over the world. During this rapid expansion, Blockbuster will always seem to be the biggest fish in the pond, acquiring smaller rental stores or forcing them out of business.

But Wayne will soon discover that in the wider business world, there's almost always a bigger fish. It's January 11, 1994, at a conference center in Palm Springs, California, seven years after Wayne Hizenga took over Blockbuster. Wayne stands on stage, just out of the spotlight. As CEO of Blockbuster Entertainment, Wayne has spent the last 12 months in boardrooms, ironing out a multi-billion-dollar merger with a media conglomerate Viacom. The deal was announced last week, and today, the top men from both companies are promoting

the merger to investors. But it's the head of Viacom who has set to lead the new company. He has the microphone, and he seems focused on only one thing. What this merger means for him and his team? Blockbuster already seems to be forgotten, and that annoys Wayne. Over the past seven years, Wayne has transformed Blockbuster into a corporate giant. More people carry Blockbuster cards in their wallets than American Express cards, and overseas the company operates more than 3,500 stores,

in 11 different countries. But as Wayne stands on the stage in Palm Springs, he starts thinking that maybe this merger isn't the right move after all. Acquiring Blockbuster is only part of Viacom's strategy. It also wants to buy the movie studio Paramount. Negotiations over that merger have been going alongside the Blockbuster deal. And when the huge new company is finally formed, it doesn't take long for Wayne to chafe against the reality

that he's no longer the man calling the shot. So in November 1995, he resigns from Blockbuster. But even without Wayne Heizenga, for a time the company's growth seems unstoppable. More stores continue to open around the world, and renting a movie from Blockbuster remains a familiar weekend ritual for millions of people. But the business changes. In the new millennium, customers increasingly turn to DVDs by mail and internet streaming to rent movies.

Blockbuster struggles to adapt. Its revenues shrink and it struggles under the burden of heavy debt. In 2010, the company files for bankruptcy. By 2014, the last of its company-owned stores have shut their doors for good. The independently operated franchises then close one by one until a single store in Bend, Oregon, becomes the last remaining Blockbuster in 2018. More than three decades after David and Sandy Cook opened, from the first door in Dallas on October 19, 1985.

Next on History Daily, October 20th, 2011. Colonel Gaddafi's long rule in Libya comes to an end after he's captured and executed by rebels. From Noisor and Ayrship, this is History Daily, hosted, edited, and executive produced by me, Lindsay Graham, audio editing by Mohamed Shazid, sound design by Mali Bach, music by Throne. This episode is written,

and research by Owen Paul Nicholas, edited by William Simpson, managing producer Emily Byrd. Executive producers are William Simpson for airship and Pascal Hughes for Noisor.