Tags: Walmart | Netflix | video | streaming

Walmart Aims to Lure Unhappy Netflix Customers

By    |   Thursday, 28 Jul 2011 03:39 PM

It's no secret that consumers' media preferences are changing or that an increasing number of companies are looking for a way to cash in on new trends. Walmart's latest attempt involves the retailer trying to swipe some of Netflix's market share by offering online customers streaming movies according to The Los Angeles Times.

“The decision to offer movie sales and rentals through Walmart.com comes just two weeks after Netflix raised prices for the majority of its customers,” the Times reports.

Describing the change, the Huffington Post reported that “Netflix plans to charge $16 a month for services that used to cost $10 a month when bundled together, for example. It's still changing $8 a month for streaming, which it launched late last year. But instead of charging $2 more for a plan that includes one DVD at a time by mail, the company will charge $8 and up for DVD plans.”

Subscribers' response hasn’t been highly receptive or understanding. CNET says that many people feel that Netflix is being greedy. There have been widespread reports that many subscribers have quit the service or are planning to do so. Investors apparently weren't supportive either because the company's stock fell after the announcement.

It appears that the backlash came as no surprise to Netflix. In a letter to investors, the company said that it expected some subscribers to discontinue their service and that it was possible that the change could drag down the current quarter's financial results, says CNET.

Walmart is apparently identifying this as an opportunity to move in on the digital movie market. Last year the company purchased Vudu, a Silicon Valley start-up. Vudu.com, which compares its service to Nexflix, is already offering movies online and it reportedly has 20,000 titles.

Vudu's library will now be available to the millions of visitors to Walmart.com. The current prices of movies at Walmart.com are $.99-5.99 for rentals and $4.99-$24.99 for purchases, the Times reports.

Individuals who choose to get their content from Walmart will have access to most movies the same day that DVDs are released, which is faster than they are available through Netflix. Vudu's website explains that an agreement struck between Netflix and Warner Bros. to postpone the availability of new releases means that Netflix customers won’t be able to get those titles through their mail service until at least 28 days later.

Though the move diversifies the options for Walmart's online shoppers a bit more, it may not really have a huge impact on the retailer's bottom line, according to Arash Amel, IHS' digital media research director.
Amel told the Times that “consumers have shown through the failures of other services that they don't want to watch movies on computers.”

However, in addition to getting service on one's computer, Vudu advertises the ability to stream content to Blu-ray, PS3 and TV.

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It's no secret that consumers' media preferences are changing or that an increasing number of companies are looking for a way to cash in on new trends. Walmart's latest attempt involves the retailer trying to swipe some of Netflix's market share by offering online customers...
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2011-39-28
Thursday, 28 Jul 2011 03:39 PM
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