Wal-Mart Buys Vudu

The number one seller of DVDs in the country, Wal-Mart, has apparently seen the writing on the wall and is again getting into online distribution of movies and other video content by purchasing Vudu, the four-year-old-company that has deals with every major movie studio and 40 independents. According to the article, Wal-Mart is paying an undisclosed sum for Vudu, which abandoned its hardware business a few years ago and instead is focusing on software embedded in millions of televisions.

As you may know, Wal-Mart has tried this kind of thing before. In February 2007, it announced it was becoming the first major retailer to offer digital movie downloads. Sadly, that didn’t work out so well with the company shuttering the business in the first year. Wal-Mart also launched a by-mail DVD service to compete with Netflix, but gave up on that as well when it partnered with Netflix later.

Now, with Vudu, Wal-Mart competes not only with iTunes and Netflix but also with Blockbuster, TiVo, Amazon and others that allow consumers to rent or buy movies digitally. Vudu currently has 20,000 titles in its library, 3,000 of which are in HD or HDX, a proprietary format Vudu says is comparable in quality to Blu-ray.

Having only seen Vudu in stores and at trade events, I can’t really vouch for the quality of the video. It just seemed okay. Plus, this seems a little late to the game what with iTunes and Netflix already having a large foothold into the living room. Still, Wal-Mart is a giant retailer with years of experience growing a successful business so it will be interesting to see how they utilize this latest acquisition.

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