There’s a new war being waged for DVD retail dollars, and the winners are consumers looking for a home entertainment bargain. In the last few days, three of the largest DVD retailers in the industry have gotten into one of the most heated online pricing battles in recent memory.
Last Thursday, Walmart’s website slashed the prices of ten of the most anticipated DVD releases of the year–including Star Trek, Angels & Demons and Harry Potter and the Half-Blood Prince–to $10. Within hours, Amazon and Target matched the prices on their own sites, which has since prompted Walmart to further lower its prices on the titles to $9.98.
Walmart.com spokesman Ravi Jariwala, whose company has vowed to become the low-cost leader in online retail, says Walmart is not ruling out further price drops:
“We remain committed to offering our customers the lowest prices online at Walmart.com, and will continue to adjust our pricing accordingly on these movie titles,”
According to the Los Angeles Times, the wholesale rate paid by the three retailers for the discounted DVDs remains unchanged at about $18. This means that while the retailers will take a major hit on each DVD sold, the studios will maintain the same profit margin on each disc. This is a welcome proposition for movie studios, as a DVD sale is much more profitable for them than a rental and this loss-leading price war is sure to boost the flagging DVD sell-through market.
In a year that has seen Redbox arouse the studios’ wrath with its rapid growth and alleged destabilization of the rental market, studio heads are no doubt applauding Walmart, Target and Amazon’s actions and hoping that DVD sales will swell their coffers once again this quarter.
Will such cut-rate pricing get you to purchase more DVDs, Insiders? Does a pricing battle of this magnitude so early in the holiday season make you wonder what else is in store? Leave your thoughts in the comments.