Wal-Mart, the world’s largest retailer, is to buy broadband entertainment provider Vudu Inc., sources revealed. The deal, for an undisclosed sum and expected to be concluded in the coming weeks, will enable the mall giant to sell movies directly through TVs and Blu-ray players.
Vudu sells and rents downloadable movies and TV shows that can be viewed on such Web-connected devices as Blu-ray disc players and some televisions.
“Combining Vudu’s unique digital technology and service with Wal-Mart’s retail expertise and scale will provide customers with unprecedented access to home entertainment options as they migrate to a digital environment,” vice chairman for Wal-Mart, Eduardo Castro-Wright, said in a statement.
The deal will let Wal-Mart more firmly into the online business currently dominated by such players as Apple, Amazon.com, and Netflix. It might also help the retailer make up for the loss of business for CDs and DVDs from normal shops.
Wal-Mart said Feb. 18 that sales at U.S. stores open for more than a year declined 1.6% in the fourth quarter. It also predicted a “challenging” first quarter in the US.
Wal-Mart said that Vudu would continue developing entertainment and information delivery solutions like Vudu Apps, its delivery platform for Internet-connected TVs and Blu-ray players. Vudu currently has a library of 16,000 movies and licensing deals with almost every major studio, as well as independent distributors.
Wal-Mart, already one of the largest U.S. sellers of digital music, might now want to include new product areas like electronic versions of books as well as Internet-based storage, analysts say.
The Vudu purchase may help Wal-Mart boost sales of flat-panel TVs and Blu-ray players, analysts observed.