Columbia House closes its doors in Canada due to ‘obsolete’ media

The promise of a dozen albums for one dollar, or some other irresistible introductory offer from the Columbia House music and movie club, came to an end in Canada on Thursday.

The entire Toronto staff was terminated after its parent company's Canadian division declared bankruptcy.

Reports about the sudden closure of Direct Brands Media, which was also offering new members a $3 book from the Doubleday Book Club, echoed a now-familiar story of an entertainment retailer unable to justify its continued existence in the digital age.

"People like to get it for free on the internet," company graphic designer Jeff Betts told the Toronto Star. "The media we sell . . . it's obsolete."

While similar laments have been heard repeatedly over the past decade, it's nonetheless rare for a company like this to abruptly cease operations, leading one to wonder how they hung in for so long.

Based on a Toronto Sun story that noted 100 employees have been left without severance just before the holidays, the closure seemed to take most of them by surprise.

Columbia House Record Club has a history dating back to 1955, designed to deliver music through the mail to Americans with limited access to record stores. Business boomed further with the introduction of cassettes and 8-track tapes, and later videocassettes.

The field became even more competitive with the higher profit margins of CDs and DVDs.

Marketing to new members generally consisted of offering an initial flurry of titles, practically for free, with the less-prominent condition that a certain number be purchased at an inflated retail price from a monthly catalogue during the membership period.

Just in case you couldn't decide which album you wanted to buy that month, Columbia House was happy to send their featured selection to you, unless you mailed in a refusal.

These practices came under greater scrutiny by the time people found online forums to complain about them.

BMG Music Service, which eventually absorbed Columbia House in the U.S., cited competition from online disc retailers when it closed in Canada in 2000. Two years ago, after the sale of the company to Direct Brands, the music club was phased out.

The company continues to sell new CDs online to American customers for $6.99 each, with one delivered each month, based on selections placed into a queue.

Columbia House Canada continued to offer memberships, initiated with the purchase of a discounted DVD, along with the promise of "No More Unwanted Shipments!" A similar approach was taken by the Doubleday Book Club, which hoped members poking around its website to fill minimum purchase requirements would add a few more discounted items to their cart.

Now, like so many other forms of media affected by the digital age, the Columbia House pitch has officially become a thing of the past: