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Walmart Reportedly Plans Streaming Rival to Netflix, Amazon Prime Video

Walmart Reportedly Plans Streaming Rival to Netflix, Amazon Prime Video
(Mohamed Ahmed Soliman | Dreamstime)

Tuesday, 17 July 2018 05:11 PM

Retail giant Walmart Inc. reportedly is considering a subscription-based video streaming service to rival Netflix and Amazon Prime Video.

The Arkansas-based retailer is said to be considering a fee of $8 for the service, which would make Walmart’s offering less expensive than Netflix and Prime Video, The Information reported, citing a source familiar with the matter.

Company officials purportedly theorize that a cheaper service would be popular among their existing customers, especially those “in the middle of America,” the report said.

It’s unclear whether Walmart would populate a streaming video service with its own original content, as competitors such as Netflix and Amazon by spending ever-larger sums of money, or attempt to acquire a studio or other entertainment entity, as AT&T did with Time Warner, Fox Business Network explained.

Walmart has yet to determine if it will actually launch a service and may decide against the idea.

For its part, shares of Netflix headed for their worst day in two years on Tuesday, falling as much as 14 percent after reporting a surprise shortfall in new subscribers in a quarter marked by the lack of a blockbuster new show and World Cup soccer.

While Wall Street remains overwhelmingly positive on Netflix and its role in video streaming globally, the second quarter figures did raise question marks over future growth and six brokerages cut their price targets on the company’s shares, Reuters reported.

“The quarter is a reminder that Netflix’s cadence of net adds is not linear, but lumpy in nature,” said Justin Patterson, an analyst with Raymond James and Associates in San Francisco, while pointing to the absence of a new hit series as a driver.

“The company had lots of new content during the quarter; what it did not have was a major new breakout series.”

Riding on the success of its original shows such as “13 Reasons Why,” “House of Cards” and “Orange is the New Black,” Netflix had beaten subscriber growth expectations in seven out of last 10 quarters.

The stock price doubled in the last year, raising its value to within sight of $200 billion as of Monday’s close.

What is not clear is where the hurdles to that unbroken run of growth will come from, be it stronger competition from Amazon Prime or the changes in control of major film and TV franchises heralded by Walt Disney Co. and Comcast Corp.’s bid for Twenty-First Century Fox Inc.

Analysts at MoffettNathanson said that Netflix’s domination of its sector looked less durable than the other high-flying FAANG group of new media and internet companies.

“The moat around Netflix’s business model does not appear as deep as other models,” it said. “We doubt that they can create and enjoy monopoly economics in content creation and internet distribution.”

(Newsmax wire services contributed to this report).

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Walmart is considering the launch of a subscription-based video streaming service to rival Netflix and Amazon Prime Video.
walmart, streaming, netflix, amazon, prime, video
Tuesday, 17 July 2018 05:11 PM
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