last100 » Wal-Mart

VOD service Vudu to become Wal-Mart’s child

Steve O'Hear — Mon, 22 Feb 2010 20:38:46 +0000

After rumors circulated in January that US retail giant Wal-Mart was eying the video-on-demand service Vudu, the New York Times is reporting that it’s a done deal. Still no official word from either company but Dan Rayburn via one of his sources says the ink has dried and that’s good enough for me. It’s also an interesting end to a pretty long story:

Vudu started as a feisty silicon valley startup, unfashionably entering the consumer hardware space with its own set-top and accompanying HD video download store. Whilst its offering received good reviews based on the UI, movies were relatively expensive, as was the box itself, and I was always skeptical that consumers in great numbers would pay for hardware just to enter the store. The Vudu box was a one trick pony, providing a store front to the company’s content, or that’s how it felt to me. Competing consumer set-top boxes seemed to offer a lot more.

Eventually, Vudu opened up a little, supporting services other than its own, and lowered the price of its entry level hardware, but that still didn’t seem to be cutting it.

Then, perhaps unsurprisingly, the company announced a change of track. It was no longer about the hardware but Vudu was going to license its platform to CE manufacturers and telcos to utilize in their set-top boxes, Internet-connected TVs and Blu-ray players etc. Putting it head-to-head with Netflix, for example, and Internet-TV widget offerings, such as Yahoo’s. And of course, another startup, Boxee.

The Wal-Mart acquisition, while the best (and only?) available outcome for Vudu, seems like an odd one. Wal-Mart sells TVs in droves but now has an interesting conflict of interest. It will be selling Internet-connected TVs that support Vudu – a platform it now owns – alongside sets that run the platforms of others.

There’s also the question of what exactly Wal-Mart have purchased: Vudu didn’t have a huge customer base and has limited distribution, so it’s more about the tech.

And the retail store’s track record with its digital offerings isn’t too good either.

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Amazon MP3, Wal-Mart and Rhapsody just made buying music more confusing following iTunes’ lead

Steve O'Hear — Wed, 08 Apr 2009 16:21:57 +0000

With the major labels cajoling Apple into upping the cost of the most popular tracks on iTunes, I wondered how long it would take other music download stores to follow suit. Not long it seems – less than a day in fact – with paidContent and Ars Technica reporting that Amazon, Wal-Mart, Lala and Rhapsody have followed Apple’s lead and introduced ‘variable pricing’.

Of course, none of this down to the stores in question. The major labels set wholesale prices for tracks, and each download store then follows suit, give and take varying margins and the odd, possibly loss making, promotion here and there. Some might argue that ‘variable pricing’ alone isn’t necessarily a bad thing, although it does sacrifice the simple buying experience that Apple first introduced with its 99c per track rigid pricing structure on iTunes. What’s certainly short sighted is to use ‘variable pricing’ as an excuse to raise the upper limit of price per track, especially in a time of recession and when less and less people still pay for music anyway.

There’s also a complete inconsistency in pricing across each store on a track by track basis. It’s not even as simple as paying more for the most popular tracks. For example, Amazon is cheaper than iTunes on some top 40 tracks and vise versa. As paidContent notes: “comparing like with like can be difficult”.

Update: ComputerWorld’s Seth Weintraub is reporting that the major labels are giving Amazon more favorable terms over Apple– cheaper wholesale prices — which would be consistent with past behavior.

Sources at Apple tell me that Apple is getting different prices than Amazon from the recording idustry. The record companies are, and have been for awhile, favoring Amazon. In fact, Amazon is selling songs for less than the price that Apple pays for them in some cases.

The motive: The majors are determined to weaken Apple’s power in the music industry, and with some success, punishing them for selling all those damn iPods.

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Report: iTunes still leading music store in the U.S.

Steve O'Hear — Wed, 06 Aug 2008 13:54:19 +0000

Apple’s iTunes remains number one in the U.S. amongst all music retailers according to the latest NPD MusicWatch figures. Based on purchases of CDs and a-la-carte digital music downloads from January through to June of this year, the league table is as follows:

iTunes
Wal-Mart (Walmart, Walmart.com, Walmart Music Downloads)
Best Buy (Best Buy, Bestbuy.com, Best Buy Digital Music Store)
Amazon (Amazon.com, AmazonMP3.com)
Target (Target and Target.com)

NPD says the results reflect “the ongoing consumer shift from physical CDs to digital music”, which has helped iTunes to consolidate the lead it established earlier this year.

Most notably, Amazon has moved from fifth place to fourth, which NPD attributes to stronger CD sales online compared to competing brick-and-mortar stores, along with the launch of the company’s own music download store, AmazonMP3, last year. As a result, we shouldn’t be surprised to see Amazon overtake Best Buy in the not too distant future.

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Wal-Mart ditches DRM at a cost

Steve O'Hear — Tue, 08 Apr 2008 13:49:59 +0000

When Wal-Mart first starting selling DRM-free music through its online store, we had one major complaint. Alongside those iPod-friendly MP3s from EMI and Universal Music, sat copy-protected tracks from the two remaining major labels that were only compatible with PCs running Windows and supported PlayForSure devices. A sure way to confuse customers and create a very poor shopping experience, we concluded.

Along with a redesign of the Wal-Mart online music store, the “world’s largest retailer” has finally ditched DRM completely but at a cost. Rather than successfully negotiating licensing deals with the DRM-free holdouts – Sony BMG and Warner Music – Wal-Mart has sacrificed music from those two labels completely (tracks from Sony BMG’s Neil Diamond seem to be the exception, reports Wired).

So why has Wal-Mart relaunched its online music store – DRM-free – without waiting till it could offer music from all four major labels? As Insanely Great Mac notes, the retailer is likely holding out for much more favorable terms, and by relaunching early is calling Sony BMG and Warner’s bluff. The majors are renown for demanding very favorable terms, which often involve substantial upfront costs and/or equity. If you’ve ever wondered why iTunes doesn’t carry DRM-free tracks from all four major labels (yet), there lies your answer.

Aside from having a half full catalog, the new Wal-Mart online music store still suffers from another major demon: the site requires Windows Internet Explorer running on XP or Vista — no Mac or Linux customers allowed.

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