After dabbling in movie download tests, Walmart is now jumping into the movie and television download business head first, and will launch their new site later today at walmart.com/videodownloads.
This is an extremely crowded market already, although Walmart has locked up deals with all of the major studios - Walt Disney, Warner Brothers, Paramount, Sony, 20th Century Fox and Universal. See the chart included in this post for the studio deals locked up by other movie download services - CinemaNow, MovieLink and Amazon Unbox all have similar deals as well. iTunes and other competitors don’t.
Television networks who’ve agreed to provide content include Fox, CW and Viacom’s MTV, Nickelodeon, Comedy Central, Logo and VH1. The television download market is currently dominated by iTunes.
Prices for movies will be $10-$20. Television shows will be $2. Downloading and watching content will require a Windows PC, as with all of the services mentioned above except iTunes.

Will This Be Successful?
Walmart has had mixed results in their online initiatives. They’ve completely bailed out of the movie-rental-by-mail market when they couldn’t make headway against Netflix. In this case, however, there is no established player to try to kill. The movie download market is in its nascent stage and anyone can win.
CinemaNow and MovieLink should be particularly worried. They operate on very low margins, are being attacked by iTunes and others already, and now have to contend with Walmart. It’s unlikely they’ll have the staying power to make it, and it doesn’t look like any of the major sites are looking to buy in this space. It’s cheaper to build a Windows-based DRM-laden player and do deals with studios directly.
However, iTunes still has the only service that works cross-platform, plays on an iPod and now on the living room television with Apple TV. And they already dominate the television download market. Walmart will not be able to easily hurt iTunes in the short term.
And don’t forget that Netflix has already released a very, very good free(ish) movie and television download service, and Joost is another service coming soon. None of these companies are going to lie down in the face of competition from Walmart, and they know that Walmart will bail out of markets that they can’t dominate.
All of this is good for the consumer, but prices are still too high. Movie downloads are still more expensive than simply buying a DVD.
















Comments
I clicked on the walmart link, and it’s asking for a username and password :s .htaccess style.
requirement besides windows as always will be: credit card and IP from the US.
Why are we Europeans always left out?
This just gives customers one less reason to leave the Walmart site.
A percentage of them will already be predisposed towards downloading movies and may have been using another service
Any extremely big and popular Web site destination could do this with some success
Given WalMart’s policy, I guess they got the deals by giving back all the money except a very low margin, which Apple doesn’t do.
I am spectikal to wether WalMart will be able to pull this off. We would need to see if they have implemented some sort of DRM and also What is the resolution for the downloaded movies?
Why would you pay DVD price for a download you can’t easily play on your TV? Especially if you have a new HDTV and want top quality?
The site is a real mess right now. I guess its only for IE. Anyways, Wal-Mart could be successful in this if they keep the prices and the resolution right. Since they always offer low prices, they could have a lot of people downloading if its cheap
This site seems to be designed only for IE, doesn’t work on Firefox… completely messed up. Sure to be a pre-alpha release.
Does it seem sort of incredible that the webdesign firm that Walmart has employed didn’t think that perhaps they should cover more then one browser?
I’m sorry, is that a DeLorean and is this 2001?
I think this more of a bad news for NetFlix, than anybody else. Walmart has been successful in providing its customers with low-cost products, mainly by forcing their vendors to lower their prices. I don’t know the kind of leverage they have on this industry, since the products are digital, however, they may simply offer a better price compared to NetFlix and eat what Netflix has left, especially if they do what Blockbuster is doing, i.e. offer a deal where customers can exchange get Walmart’s coupons when buying a online movie.
since there’s no key player in the video download market yet, and given walmart’s existing power clout - walmart Could indeed gain a foothold on this market.
i highly doubt though they’ll be the titan’s of video download.
walmart is all things, to all people, for middle class america.
That’s what it is, that’s what it does best - stick to it, stick to what you know.
when one thinks of downloading a movie - walmart doesn’t exactly pop into one’s’ head as the first option.
the power or branding.
some new or existing online co. will brand itself as the movie download king. then and there, will people associate the two words of ‘video downloads’ with that co.
Does any one know which movie studio and TV shows are available on xbox Live
Walmart may have bailed out of the movie-by-mail market not because of the competition but based on a good read as to where the market was headed.
With no clear leader in movie download market and with the mobile web wide open Walmart’s timing maybe spot on.
I doubt given the size of this market that they will bail….
Aside from the fact that I don’t know why *anyone* would pay $10-$20 for a downloaded movie, I’m skeptical that those who do will find the idea of doing it through Walmart appealing.
For one thing, the Walmart brand doesn’t exactly connote “technological advancement,” and I find it a little unlikely that people will begin to associate the site with this type of purchase. Walmart’s success is in being able to provide a wide range of products at rock-bottom prices, neither of which factors in here.
Beyond that, though, a solid percentage of the people most likely to buy films online are presumably tech-savvy young males with cash to burn (i.e., the same people to whom Hollywood generally markets its output). Pardon me for generalizing, but doesn’t that Digg-ish demographic sort of despise Walmart?
Maybe I’m being overly cynical, but I wonder if Walmart wouldn’t have more success in this if they’d launched the video-download site under a pseudonym.
To put it another way: If McDonald’s were to get into the business of, say, home delivery of organic groceries, would they go slapping the golden arches on everything? I don’t think so.
“Why are we Europeans always left out? ”
Because they are too lazy, inept or uninterested to develop such a service themselves. Creating a service like this requires a team of lawyers and business execs just to get it working in one country let alone the 25+ different legal systems in Europe and even more worldwide. Why should American companies waste so many of their resources on a new product before it has even been established here? To paraphrase the environmental movement, “Think globally, start locally.”
Will these movies be able to be converted to any format or at least able to be burned to a DVD?
@Florian (2),
When one does licensing deals for the right to distribute content it is tied to a particular territory (e.g. US, UK, Germany, etc). Apparently Walmart just has the US rights for Internet-based distribution for these titles.
That doesn’t mean they won’t acquire rights elsewhere at some point in time.
hurm…. some browsers, coding’s, converting, determination between HDTV and DVDs problems!!
does people cares? is it anyone buying? just think of it not so many “human” are using HDTV, there still people who thought that video which they downloads is not functioning just because they never heard of codex!!
and to tallfreak: no one is lazy enough to be left out cause this is online world which we got millions of site just to wonder which one is better serving information…. and not many understand “English” better than an Englishmen!!
but, at least they doing something…
but why?
hey!
it seems it has some problems with firefox! I have a screenshot of the home page, it’s horrible!
“Why are we Europeans always left out? ”
Well, Joost is being developed out of Europe by the founders of Skype, which also hit Europe first. So I don’t agree with the blanket statement that Europeans are lazy and inept. In fact, I think it is really smart to use the distributed P2P model for something as storage and bandwidth intensive as video. In that regard, the download services have missed the boat on their model. They’ll be paying a lot for bandwidth and storage, and video quality will be relatively poor. I’ll stick with Netflix DVDs for now, and continue beta testing Joost for now, thanks.
I reckon we just put them all in a ring and let them fight it out.
Then go with whoever emerges.
peekvid, file sharing networks,
i think what these guys need to be worried about is the pirated market. I dont want to pay $10 to download a movie when i can get it in 10 mins from the internet for free
This reminds me of when they tried to go head to head with Netflix in the online rental biz.
Europeans are lazy and inept.
Actually the so-called Europeans have been having movie downloads programs for a while, either TV programs or movies.
Check that one for example :
http://www.francetvod.fr/
And the opposite is true, US IPs are also forbidden to access those services
It’s not a matter of who’s stupid or not … it’s just the copyright owners who are deciding that they want to control where their content is seen so they can
still manage their release calendar.
If movies and DVD were releases globally at the same time, I think all services would sell globally, it’s just not the case yet.
Re: “Why would you pay DVD price for a download you can’t easily play on your TV?” … CONVENIENCE : you’re able to download the movie within minutes without leaving home and without having to watch THAT specific DVD that you added to your queue maybe months ago. Now yes it’s expensive but some folks don’t care about money.
The rental prices on those services is usually $2.99 or $3.99 which is close enough to the prices you get via Netflix or the local video rental store and again without having to go out or wait for mail.
Walmart continues to surprise with its odd business decisions. After flailing on music downloads and DVD rentals, this exercise seems also destined for failure.
The recent entrants (Apple, Amazon, Walmart) are getting it completely wrong: the market for *purchasing* video downloads is small. The market wants pay-per-view/rentals. That’s why the Netflix offering will be appreciated and why the networks are having great success streaming TV shows at their web sites.
Have you ever heard of the long tail? WM is going after the long tail market, but attracting a crowd with new releases. As for the living room, that’s next!
Check out Walmart videos on Firefox..Hail to the Internet Explorer!
http://www.flickr.com/photos/6.....381892877/
hmmmm….
if you really want to start/create a business for downloading movies, i’m not sure that simply repackaging/reselling traditional movies/tv shows is the way to do it.
another way might be to create a distributed distribution network/system that could be used to distribute any kind of large file. a baby akamai. the cost of the hardware/servers is low enough to make the economics work.
the use of a bittorrent like app could be used to effectively handle the redundancy for the transfer of the files/content.
provide a complete solution for the owner of the content, including the payment processing function. focus on providing the needed infrastructure to allow anyone to upload their large file content, and to be able to distribute it on the network to the potential customer. allow the user to accommodate different payment approaches. all of this is simply technology/implementation.
you’d need ~10-20K servers to really make an impact.
if implemented correctly, you’d have a system that would essentially become a digital distribution network. rather than a p2p kind of network, this approach would be managed, reasonably secure, and able to handle seriously large amounts of traffic.
owners would be able to upload their digital content, with the end user being able to download the content to burn to cd/dvd… security could be easily accomplished by requiring the end user to use an app to download the content/decrypt it/burn it/etc… it’s not that hard to be able to have the person who downloads the app to have the content embedded with key information for the given person/user.
the idea/approach is to be able to essentially create a unique copy of the movie/content for each user who wants to download the content. this approach allows the owner/distributor to track the content back to the rightful owner.
this kind of approach would open up the market for movies to the entire arena of people who are looking to sell/distrbute their movies, at a price point that would be doable w/r to the bandwidth required to deliver the content.
the overall system would provide a robust api, allowing various sites to insert widgets for the movies/content, as well as allowing owners to track their content within the network.
peace…
Movie downloading will not be monopolize by apple the way mp3s are.
1) the movie studios will not play ball with Jobs if he insists on exclusively and 9.99 downloads.
2) netflix will launch their downloads soon and it’s a natural for current netflix subscribers to download from them.
i see walmart having a good horse in this race…as good as any.
Defensive move by both Walmart and the studios to uphold the pricing. Jobs/iTunes is trying to beat them down to consumer friendlier prices and that scares the hell out of Walmart, their DVD sales would go to hell in a handbasket. Walmart will fail as they have in other online businesses because they basically have a brick-n-mortar mindset and their online execs have no clout when put up against the b/m guys.
- I dont think that we are lazy and inept but I’m European of course.
- You have to think about the rights for Internet-based distribution for these titles
- You have to “Think globally, start locally.” to test the BM.
and only then
- You have to think about “the 25+ different legal systems in Europe and even more worldwide”
.
Technology continues to improve, quality motion picture content less so.
Customers benefit when the big dogs compete.
It all comes down to targets in my opinion with this stuff. Wal Mart has a specific audience that is a niche and I think there’s potential for success with their initiative because of this.
I agree that customers benefit when big dogs compete. I think this is only the beginning of what’s to come with video via web and downloads. Very cool.
definitely screwed up in firefox, displays fine in safari though…
Nice move. Not supprised.
Some technical hiccups can be fixed easily. It could be ran well and become a success in future. But, we’ll see.
http://www.fairyland.tv
I would be interested in finding out just how many people actually use Wal-Mart as an online retailer.
There are several reasons Mal-Wart will fail just as they’ve never dominated any popular culture venue/product (i.e. CD’s, DVD’s)!!
1) They will shut out artist who don’t conform to their world (i.e. Christianists) view.
2) They will TRACK YOUR DATA AND SHARE IT WITH THE GOVERNMENT!!
3) They are racists. Black people will be left out of the market. And Arabs, and the French and all furners etc.
4) The company is becoming more and more hated around the world.
I can’t believe how horrific this looks in Firefox. A large company like this should have processes and QA in place before they release this to the public. I makes me wonder what else may be wrong under the hood.
Rodney Rumford
This service, so far, is horrible! The help files on the site are misguiding when it comes to how you play your files on Xbox360, and on how to back up your movies to DVD/CD. I called their so-called customer support line only to be told, “sorry, but we are in beta still…”. This is just another pathetic excuse at how large companies can rip people off and get away with providing bad service. Now I have paid for a movie that I can’t watch on my TV via Xbox360, and can’t back up to disc. Guess I should be happy with being told, “sorry”. I’ll never use walmart again, and I’m sure they have changed the wording on the help files now that I have made them aware of it.
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