In a move likely to shake up the VOD market, retail giant Walmart announced on Monday that it was purchasing online movie service Vudu for an undisclosed sum. Other suitors for the firm included Best Buy, Amazon.com and Comcast.
The three-year-old streaming company has its service built into devices from every major electronics manufacturer except Sony and Panasonic. Analysts see the purchase as a major step into the digital market by Walmart, which has traditionally stocked fewer online-capable televisions and devices than its competitors. Foster Research analyst James McQuivey said the following about the purchase:
“At the very least this shows Wal-Mart understands that [its lack of online-capable inventory] has to change, because the DVD is eventually going away . . . They are making a bet on connected devices.”
Sources close to the deal say that Walmart will likely keep the Vudu name on the service, but will be making one major change immediately: Vudu’s broad category of pornographic titles will be shut down by the family-friendly company.
Riddhi Patel, an analyst with research firm iSuppli, feels that Walmart’s move is in line with a general trend towards web-ready home electronics devices. The analyst predicts that more than 60% of HDTVs will connect to the Internet by 2013. Said Patel:
“It’s getting increasingly cheap to put Internet connections into televisions, and there are definitely financial opportunities to doing it,”
Insiders, do you own a Vudu-capable device? If you do and have used the service, what has your experience been like? How do you think Walmart’s ownership will affect the movie service, as well as the VOD industry at large?
(via The New York Times)