Wal-Mart Joins Hollywood in a Movie Service

by InvestorPlace Staff | March 14, 2012 12:54 pm

In the latest plot-twist gripping the streaming movie business, Wal-Mart (NYSE:WMT[1]) has announced it’s teaming up with five of Hollywood’s top studios to allow the discount giant’s customers to make digital copies of physical DVD or Blu-ray movies. Those copies, at a cost of $2 apiece, would be automatically uploaded to the cloud, in this case, to Vudu, which is Wal-Mart’s entry in streaming video.

The studios joining with Wal-Mart in the new effort are Sony (NYSE:SNE[2]), Viacom‘s (NYSE:VIA[3]) Paramount, Time Warner’s (NYSE:TWX[4]) Warner Brothers, News Corp’s (NASDAQ:NWS[5]) 20th Century Fox and Comcast’s (NASDAQ:CMCSA[6]) Universal.

Why would these studios team up with Wal-Mart? Because the new Vudu service will be linked to their own Ultraviolet cloud-storage service for the movies they produce. As Reuters [7]explains it: “Hollywood is trying to revive interest in movie ownership with Ultraviolet, which allows viewing anytime from Internet-connected devices.”

That service would gain tremendous growth even if just a small fraction of Wal-Mart’s millions of customers tap the new digital-conversion service.

So, yes, this is yet another volley in the increasingly heated battle to capture consumers and convince them it’s worth it to own movies stored in the cloud, rather than rent them from the likes of Netflix (NASDAQ:NFLX[8]). And don’t overlook Walt Disney (NYSE:DIS[9]), which has its own service in competition with Ultraviolet, as still another combatant in this war.

As an additional enticement, Wal-Mart will upgrade consumers’ standard-definition DVDs to high-def Blu-ray quality for $5. Will that be enough to get consumers to put their filmed entertainment in the cloud?

Endnotes:

  1. WMT: http://studio-5.financialcontent.com/investplace/quote?Symbol=WMT
  2. SNE: http://studio-5.financialcontent.com/investplace/quote?Symbol=SNE
  3. VIA: http://studio-5.financialcontent.com/investplace/quote?Symbol=VIA
  4. TWX: http://studio-5.financialcontent.com/investplace/quote?Symbol=TWX
  5. NWS: http://studio-5.financialcontent.com/investplace/quote?Symbol=NWS
  6. CMCSA: http://studio-5.financialcontent.com/investplace/quote?Symbol=CMCSA
  7. Reuters : http://www.reuters.com/article/2012/03/13/walmart-hollywood-idUSL2E8ED9X820120313
  8. NFLX: http://studio-5.financialcontent.com/investplace/quote?Symbol=NFLX
  9. DIS: http://studio-5.financialcontent.com/investplace/quote?Symbol=DIS

Source URL: https://investorplace.com/2012/03/wal-mart-joins-hollywood-in-a-movie-service/