Updated: Wal-Mart buys Vudu

Update: The rumors are true. Vudu and Wal-Mart announced a definitive agreement for the retail giant to buy the streaming video service today after the close of Wall Street. The deal is expected to close in the next few weeks and – not surprisingly – no price was given. The full release is reprinted after the jump.


Looks like those rumors that Wal-Mart was looking hard at
the online movie business might be true. The Wall Street Journal is reporting
that the retailer has agreed to buy Vudu for an unknown amount.VUDU2  

Technotainment reached out to a Vudu spokesperson who said
he had no comment at this time. The Journal says the companies began informing
studios and TV manufacturers of the deal today.

Vudu, for the unfamiliar, is a streaming media company that
allows users to rent of purchase movies. In January at CES, it announced a
number of deals with manufacturers – including LG Electronics, Mitsubishi,
Samsung, Sanyo, Sharp, Toshiba and Vizio – to have its service embedded in
television and Blu-ray hardware.

We’ve written about Vudu previously here and have been very
impressed with the service and its potential. It could become one of the
biggest threats to Netflix’s dominance of the online video space, though it
offers a dramatically different business model.

Netflix, of course, has been attracting the attention of the
studios recently – and not in a way it had hoped. Warner Bros. has convinced
the company to not rent any of its releases until they’ve been commercially
available for 28 days.

Wal-Mart has a little more leverage than Netflix, though,
and may be able to negotiate better terms for releases on Vudu. At the very
least, it should be able to significantly increase the number of titles the
service offers.

A less important question in the grander scheme of things,
but an interesting one nonetheless is: If this report is accurate, what does
the deal mean for Vudu’s relationship with porn companies?

Vudu allows people to rent or purchase films from adult film
studios, including Vivid and Digital Playground. Wal-Mart guards its family
friendly reputation ferociously. It’s questionable whether it will continue to
offer adult films.

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