Starbucks, which already scaled back its once-grand plans to turn itself into an entertainment hub, is going to shrink its cd and dvd plans again. News is, that by September of this year, the company will have dumped nearly all of its in-store music cd and music "card" selections. That means no more racks offering multiple CD choices to its coffee-buyers. And it also means the end of gift cards and promotions for Apple's iTunes. To replace that, reports are, the chain will offer a paltry four CD "slots" per store. It will continue to offer free Wi-fi access to Apple's online music store and possibly continue to try to sell entertainment product online.
The move shouldn't be a big shock: Starbucks has been rethinking its entrance into cds and dvds since earlier this year as it attempted to restart growth in its core coffee business. Its efforts to sell music have come under heavy scrutiny from the financial world. For example, in March, a scathing New York Times article reported that the chain was selling just two CDs per store per day (dvd sales were even worse). A month later, Ken Lombard, the head of the chain's entertainment business, was removed, and the company handed management of its Hear Music label, which had just started releasing its own CDs, over to Concord Music Group. Seems like coffee consumers aren't necessarilly into the "Starbucks" sound and quirky films (Pursuit of Happyness, Juno). So much for seeing the next generation dvd discs (blu ray, BD format) in their stores.
But the pullback is still going to be bad news for the music and movie industry, which doesn't need any more bad news. The industries had once hoped that the coffee chain could help replace the dying music shops. Seems like Starbucks has had as much to worry about with its coffee sales.
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