Wal-Mart launches movie downloads store

Posted on 6 Feb 2007 at 11:59

US retail giant Wal-Mart has launched a movie downloads service to compete with iTunes, according to reports. It is a Windows-only, US-only service.

Wal-Mart opened a beta version of the store today, selling some 3,000 films and TV shows at prices that marginally undercut those that Apple is charging.

The retailer appears have made some concessions to Hollywood demands for variable pricing, something that Apple has resisted, and as a result has signed up more studios than the two, Disney and Paramount, that have agreed to sell movies through iTunes.

However while iTunes downloads can be played on up to five devices, which the studios are thought to consider too generous, Wal-Mart movies are restricted to just one PC and one portable device. Playback is restricted to computers running Windows XP and Vista (32-bit) and handhelds that support Windows Media Player DRM; that includes Microsoft's Zune but excludes Macs and iPods.

Wal-Mart has previously raised concerns that downloads would eat into DVD sales, concerns that are thought to have made Hollywood studios reluctant to back download services in case they alienate the world's leading DVD seller. Now that Wal-Mart has backed downloading, analysts believe it opens the door for the studios to license their content as they wish.

'It gets the ball rolling finally,' Tom Adams of Adams Media Research told AP. 'Now the studios are free to pursue it as aggressively as they can without worries about what Wal-Mart is going to think.'

Wal-Mart's concerns may have been assuaged by Disney's success in selling 1.3 million movies through iTunes, while seeing record DVD sales for Cars and Pirates of the Caribbean: Dead Man's Chest.

Author: Simon Aughton

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