High street music and DVD chain HMV is to appoint an administrator. It’s the latest giant to succumb to the decline of the High Street, leaving the future of some 4,350 jobs uncertain, BBC News reports. The chain’s 239 stores in the UK and Republic of Ireland will remain open whilst administrators Deloitte assess the state of the business and seek potential buyers.
This is the latest chapter in a grisly period for entertainment retailers, with the once-unstoppable Play.com calling a day on their retail business earlier this week.
In a statement, HMV said: “The board regrets to announce that it has been unable to reach a position where it feels able to continue to trade outside of insolvency protection and in the circumstances therefore intends to file notice to appoint administrators to the company and certain of its subsidiaries with immediate effect.”
This has been a long time coming now, as HMV’s woes have been ongoing since the rise of online shopping, many of which have been highlighted in an excellent analysis by The Stool Pigeon. In 2011, HMV Group sold off its branches of book retailer Waterstones to A&NN Capital Fund Management to alleviate some of its debt. And last year they sold off their live music venues, initially acquired in 2009 in order for the company to expand into the live music market.
The firm will no longer be accepting gift cards, which will come as a blow to anyone who received one as a Christmas present.
As the primary stockist of CDs in the UK, it’s obvious that HMV’s closure could have a resounding effect on the format, but it’s unclear how this might play out. Will it be worth the while of major labels to continue to press CDs if there is no major outlet to sell them in, and if not, how will this effect the market of CDs for independents? It’s also important to consider how this will impact web-based retailers Amazon and iTunes, who will effectively hold a monopoly on the market if HMV is not bought up, and whether the potential demise of the chain open up avenues for independent record stores, or whether the hole left in the high street drive people away from visiting shopping hubs.
HMV remain determined that this will not be the case, however, as boss Trevor Moore told journalists earlier today, “We remain convinced we can find a successful business outcome… The intention is to continue to trade the stores.”