Circuit City's DIVX Lost Millions

Circuit City backed DIVX, a pay-to-watch DVD format that gave buyers 48 hours of viewing after they first pressed play. Once that window closed, they had to pay another fee for two more days or upgrade the disc for unlimited viewing. Customers rejected the idea, and Circuit City killed DIVX in June 1999 after barely a year, taking a $114 million after-tax loss, while Variety estimated the total loss at $337 million. Circuit City did not file for bankruptcy until 2008, but DIVX is often cited as one of the expensive failures that helped drag it down.

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