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Retailer Wal-Mart Buys Digital Distributor Vudu

Photo of Anne Thompson By Anne Thompson | Thompson on Hollywood February 23, 2010 at 12:10AM

Wal-Mart is getting into the online movie business by acquiring download provider Vudu. Before now the mighty brick-and-mortar discount retailer hasn't had much luck with its attempts to crack the digital code--the studios dive-bombed Wal-Mart's last effort, a web store. And Vudu abandoned set-top boxes in favor of adding software that has been added to slightly more costly DVD players to enable them to stream movies off the internet. MovieBeam marked another botched attempt to get web movies into the home via expensive boxes.
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Thompson on Hollywood

Wal-Mart is getting into the online movie business by acquiring download provider Vudu. Before now the mighty brick-and-mortar discount retailer hasn't had much luck with its attempts to crack the digital code--the studios dive-bombed Wal-Mart's last effort, a web store. And Vudu abandoned set-top boxes in favor of adding software that has been added to slightly more costly DVD players to enable them to stream movies off the internet. MovieBeam marked another botched attempt to get web movies into the home via expensive boxes.

Several bidders were willing to fork over $100 million for Vudu (as opposed to Netflix). So with Wal-Mart behind the distributor, this could be a game-changer, assuming everyone knows what they are doing. Here's Variety and the LAT:

The move is a bet by the retail giant, the largest seller of DVDs in the country, that consumers eventually are going to rely upon online services to watch movies rather than buy them from Wal-Mart or rent from Blockbuster. DVD sales have declined in recent years, forcing retailers and studios to look at digital distribution to make up the gap.

UPDATE: PC World's Jeff Bertolucci explains why Wal-Mart and Vudu want to enter world of video streaming.

This article is related to: Web/Tech, Digital Future, DVDs


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Thompson on Hollywood

Born and raised in Manhattan, Anne Thompson grew up going to the Thalia and The New Yorker and wound up at grad Cinema Studies at NYU. She worked at United Artists and Film Comment before heading west as that magazine's west coast editor. She wrote for the LA Weekly, Sight and Sound, Empire, The New York Times and Entertainment Weekly before serving as West Coast Editor of Premiere. She wrote for The Washington Post, The London Observer, Wired, More, and Vanity Fair, and did staff stints at The Hollywood Reporter and Variety. She eventually took her blog Thompson on Hollywood to Indiewire. She taught film criticism at USC Critical Studies, and continues to host the fall semester of “Sneak Previews” for UCLA Extension.