Wal-Mart Stores Inc.
) has announced its decision to expand its Disc-to-Digital
service, an in-store service to allow consumers to access the
digital versions of DVDs and Blu-ray discs containing their
favorite movies. In addition, Walmart plans to launch a new
application for the users of
) to provide easier access to exclusive movie titles and an
opportunity to share and choose titles, thus influencing in-store
and online purchase decisions.
The expansion of this disc-to-digital service will enhance the
value of movie ownership and provide easier access through
Internet-connected devices. The service will be available at
Wal-Mart stores from this month onward. Consumers will be charged
$2 for the conversion of standard DVDs and Blu-ray discs and $5
for upgrading standard DVDs to High-Definition (HD).
Further, Walmart is giving its customers 10 pre-selected
movies free of cost when they open a VUDU account or register for
an UltraViolet account or connect to an existing account.
The company started this service in April 2012. Walmart teamed
up with six major Hollywood studios:
DreamWorks Animation SKG Inc.
)'s Paramount Home Media Distribution,
)'s Sony Pictures Home Entertainment,
)'s Twentieth Century Fox Home Entertainment,
)'s Universal Studios Home Entertainment and
Time Warner Inc.
)'s Warner Bros, in order to provide this in-store digital
In addition, the company used Vudu video-streaming service to
convert the discs to digital service through the movie industry's
UltraViolet technology. The UltraViolet system, launched by
Warner Bros., allows consumers to watch movies on multiple
devices including televisions, tablets, smartphones, gaming
consoles and more.
Also, Walmart, in partnership with Hollywood's largest
studios, developed the Walmart Entertainment Facebook App to
provide more than 26 million Facebook fans with exclusive movie
content for just $5.
This app will enable its users to rate movies, watch exclusive
behind-the-scenes footage and even vote for popular movies.
Moreover, it will enable access to exclusive content for
theatrical and DVD releases and video games.
We believe this initiative will boost Wal-Mart's lackluster
movie sales, which have been declining due to the presence of
other forms of entertainment and online alternatives. With the
digital access, customers will now be able to watch movies
anywhere on a variety of new devices. Further, the social
networking site Facebook will personalize the store experience.
Wal-Mart holds a Zacks #3 Rank (Hold). Over the long-term, we
provide a Neutral recommendation on the stock.
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