Walmart Acquires Vudu in Major Digital Move

Author: M.L. Zupan
Published: February 26, 2010 at 10:16 am

In a major move to secure its own digital presence, corporate giant Walmart is aquiring Vudu, the high-definition on-demand movie service. What will this mean to the instant movie industry? That's anyone's guess, but one thing is certain: Netflix will now have a major run for its money.

According to Walmart, one of the first steps it is going to take is to eliminate "adult" titles currently under the AVN banner, content that had set Vudu apart from it other online competitors.

Similiar to Redbox, Netflix, and services offered by many cable providers, Vudu offers instant digital access to thousands of high-definition movies. Top quality and box-office hits are available at the same time as new DVD releases, all without leaving your home.

Netflix offers a simple subscription plan per month. You can pick movies and have them delivered to your home, keep them as long as you like, and then send them back in the SASE included. You can also watch instant movies online right on your computer with thousands of titles to choose from.

Redbox, on the other hand, gives you the option of renting any DVD for only $1.00 for 24 hours. Latest releases are its specialties, but I dare you to find a Redbox with Avatarin stock on the day it's released. You might have to drive around the entire city to find it.

Vudu is cross between Netflix (without the subscription), Redbox (with the pay-as-you-watch), and services offered by cable providers (watch high-definition on your television). Like cable, in order to watch anything on Vudu, you must first purchase the Vudu box—an initial cost of $149.00—available from retailers like Best Buy. Once you have the box, you only pay for movies that you watch.

So a subscription on Vudu is free, and the consumer will pay for each individual viewing. What is not listed on the web site is the cost per viewing.

Unless Walmart drastically changes the way they offer movies online, they are going to have a hard time capturing a larger market share.

What could possibly entice anyone to spend a large sum up front, plus pay-per-view online when you can already get what you want from Netflix and watch as many movies as you want online for the same low subscription price?

Without a change in Vudu's architecture, Walmart will have no differential advantage. But with Walmart's deep marketing pockets, they could easily change the way people watch movies online. It's definitely a picture worth watching!


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