Wal-Mart to Become an Online Video Service Provider

What do you do when you are one of the top retailers of DVDs in the United States, and the product starts to face serious substitution from a newer product?

You start selling the newer product. Or so Wal-Mart thinks.

The retail giant, according to the New York Times, has agreed to buy Vudu, a three-year-old  online movie service built into an increasing number of high-definition televisions and Blu-ray players.

Wal-Mart’s move is likely to give a lift to sales of Internet-ready televisions and disc players, which generally cost a few hundred dollars more than devices without such connections.  Nor is the move the first attempt by Wal-Mart to figure out a way to make a transition from sales of packaged media to online forms of video consumption.

Wal-Mart dabbled in aq Netflix-style online DVD rental several years ago, but sold the operation to Netflix after getting 100,000 to 250,000 subscribers. Wal-Mart also attempted to get into video rentals with HP in 2007, but it gave up on that project after a year.

The Vudu acquistion would instantly make Wal-Mart a significant force in the video streaming business, and would make the company a direct competitor to Netflix once again.

Vudu initially entered the market with a set-top box that offered access to its video streaming service, but gave up on building its own hardware, and started offering its service as a software offering that could be integrated into other consumer electronic devices.

That might make more sense, as Wal-Mart also now is one of the leading retailers of consumer electronics.

Of course, Wal-Mart also has to position its electronics sales against Best Buy, a major competitor that likewise  is working with CinemaNow to enable streaming video services on its own consumer devices.

Wal-Mart Closes Video Download Service

Wal-Mart shuttered its video download service Dec. 21. Videos purchased and downloaded as part of the service still are playable, so long as the original PC the movies were downloaded to remains operational. Due to licensing restrictions, those videos cannot be copied or transfered to a different computer.

That's an obvious measure to protect copyrights, but points to one objection some users may have to buying downloads. Some of us go through a PC a year, so "buying" really means viewing until the hard drive or PC dies.

Having learned the hard way this will happen, some of us now store iTunes collections on external hard drives, so we can lose the CPUs without having to reload all the music again.

gPC from Wal-Mart, Everex

Wal-Mart will sell a $200 Linux-powered desktop built by Everex and running Google applications. The Everex gPC runs Gmail, Google Docs & Spreadsheets, Google Calendar, Google Product Search, Google Blogger, Google YouTube, Google Maps, Google News, Meebo (instant messaging), GIMP (image editing), Firefox, Xing Movie Player, RhythmBox, Faqly, Facebook, Skype and OpenOffice.org 2.2.

The device is seen as an impulse buy. First-time users and grandparents, perhaps. Or, as will happen, as test platforms for people who already have full-featured PCs, but want to experiment with Linux apps and cloud computing. In some cases, people might just use it as a communications and Web apps platform.

Besides green, the “g” stands for the gOS, the Ubuntu 7.1 Linux desktop developed by an open source startup of the same name. “The gOS is an alternative operating system that makes it apparent that Google is your entire computing experience,” said gOS founder David Liu.

Wal-Mart to Sell HughesNet Services

Need a little satellite broadband with your order? Wal-Mart customers will be able to buy HughesNet satellite broadband services soon. Sure, it is a niche. But there are lots of big niches in the communications business. About 10 percent of all U.S. end users live places where the local telephone company is not one of the big brand names. Also, for some of us, wireless is a good way to back up a primary wired broadband connection. In my case, Covad as a primary for primary in-home business and personal use, plus 3G wireless primarily for mobility, but also as the backup in case the primary service fails for any reason.