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Wal-Mart Enters NetFlix's Business

Posted by timothy on from the flixing-its-tail dept.

wcbrown writes "AP reports that Wal-Mart is entering into the online DVD rental arena, currently dominated by Netflix. Wal-Mart is starting out with 13,000 titles, six distribution centers, and competitive pricing. With a seriously tremendous infrastructure and expansive will, Wal-Mart stands poised to overtake Netflix. To say the least, that's not going to be good for business."

14 of 679 comments (clear)

  1. Maybe not such bad news for NetFlix by drfuchs · · Score: 5, Insightful

    This isn't necessarily bad for NetFlix. First, it "validates" the market, and gives NetFlix a bunch of free PR (all the articles about the Walmart entering the fray will compare/contrast with NetFlix), including making tens of millions of consumers more aware of this new sort of rental scheme that they just don't grok yet. Second, it makes NetFlix a take-over target for any other company wanting to join in the competition (perhaps even BlockBuster, if their home-grown offering falters). Then again, maybe NetFlix will get blown out of the water.

    1. Re:Maybe not such bad news for NetFlix by drfuchs · · Score: 5, Insightful

      p.s. Also, all non-Walmart stores that sell DVD players (Circuit City, Best Buy, CostCo etc.) are motivated to push NetFlix on their customers, rather than Walmart, with whom they compete. Everything from the salesperson suggesting NetFlix (and perhaps getting a kick-back if you sign up), to NetFlix coupons in/on the box, to PR at the Point-Of-Sale.

  2. Patent by ihummel · · Score: 5, Funny

    Quick Jeff Bezos, patent DVD rentals and save us from Walmart!

  3. Although they might do it.... by Lumpy · · Score: 5, Interesting

    Last week my local Walmar had a large vending machine that dispensed the DVD that you wanted to rent. and the machine would accept the returns also.

    All I needed was my credit card/ debit card.

    Maybe they are looking to expand in both online rental and vending style?

    --
    Do not look at laser with remaining good eye.
  4. Competition by Lizard_King · · Score: 5, Insightful

    To say the least, that's not going to be good for business

    Competition is good for the consumer.

    --
    "My mother never saw the irony in calling me a son-of-a-bitch." - Jack Nicholson
    1. Re:Competition by oopy_-_ · · Score: 5, Informative

      It looks like the first innovation Wal-Mart made was shifting the liability for lost/stolen DVDs to the consumer. With NetFlix, as long as it doesn't happen often, you don't get penalized for having one lost in the mail, with Wal-Mart, it costs you $17.88 (see here).

  5. The only problem for me is... by ScottGant · · Score: 5, Insightful

    That when I go to rent a movie, it's usually on a spur of the moment thing. It's like I ask my wife "what would you like to do tonight" and she might say I don't know...wanna rent a movie?

    So then we go down to the rental place and look around, not really sure what we want and pick something up and go home THAT NIGHT and watch a movie.

    With renting a movie over the net and having it mailed to you isn't quite what we're looking for. We want something we can see that night, not two days from then...because the way we live two days from then we might be doing something else that comes up etc etc. We live by the seat of our pants and never really plan out little things like movie watching in advance.

    At least, that's how we play it. Is there really that much need for this out there? Just curious.

    --

    "Music is everybody's possession. It's only publishers who think that people own it." - John Lennon.
    1. Re:The only problem for me is... by FearUncertaintyDoubt · · Score: 5, Informative
      That when I go to rent a movie, it's usually on a spur of the moment thing.

      You, my friend, do not have young children. "Hey, let's go get a movie" turns into a two-hour ordeal of car-seats, crying, dropped ice-cream, potty breaks and/or diaper changes, and so on...

      The reality is that you give up a little spontaneity for a lot of convenience. You don't find hopping over to the video store for a movie all that troublesome, but there are plenty of people who do. Having a movie you want to see, right at hand, when you find yourself with a couple of hours of peace is a luxury to a lot of people.

      I work with a guy whose family lives in Alaska. The one video store in town has a pitiful selection. Netflix provides something they simply can't get otherwise.

      As far as movies go, there is a high psychological threshold that has to be reached in order to go rent a movie. Why? Because you have to go, pay on the spot, and are committed to going back within a few days to a week to return the movie. You are less likely to rent something wierd or experiement with different tastes because, well, because, that's just how most people are. But clicking on a movie on the site is low-threshold, and I find myself putting all sorts of odd movies on my netflix list that I would almost certainly never go through the effort to rent at Blockbuster.

  6. You want to make some SERIOUS money? by WndrBr3d · · Score: 5, Funny

    Rent DVD porn. I'm serious, the porn market on the internet already makes insane amounts of money. All you need to do is start up a NetFlix service that rents out DVD porn.

    Both NetFlix and the new Wal-Mart service will not carry such titles.

    And if anyone out there knows of a service like this already, please, let me know :-D

    1. Re:You want to make some SERIOUS money? by ryanvm · · Score: 5, Funny

      Rent DVD porn. I'm serious, the porn market on the internet already makes insane amounts of money.

      Ugh. I can't think of anything more disgusting than handling something that is guaranteed to have been in the possession of someone clutching their own genitals.

  7. Re:Wal Mart vs. Microsoft by Zuke8675309 · · Score: 5, Insightful

    It will be good for the consumer because there will be price competition. As it stands now, Netflix has cut down on service and raised prices since they started. In fact, this is EXACTLY the type of service that Wal-Mart should EXCEL at. Wal-Mart is a master of the supply chain, which is the main issue with DVD rental through the mail.

    I don't understand the argument against Wal-Mart in regards to small businesses. If Wal-Mart undercut everyone else, pushed small businesses out of business, and then jacked their prices up I could understand the argument. I haven't seen that though, they're always the lowest price. Lowest price is good for consumers. As for the service aspect - I don't need good service to buy rubbermaid, toilet paper, toys, video games, or dvds. I just need/want low price.

  8. The market is self-correcting by JonTurner · · Score: 5, Insightful

    Not good for the consumer? Rubbish. You act as though aggressive competition guarantees an irrevocable market dominance. It doesn't! As soon as your theoretical future-walmart doesn't meet the consumer's desire for quality+low prices+convenience (something it currently does quite well, mind you) another business can rise up to meet that need.

    Give the consumer due credit -- when a company takes it's customer base for granted and acts like a "dinosaur" it loses market share to smaller, more nimble companies that give the customer what they want. The business history books are full of examples (see Sears & Roebuck, K-Mark, IBM, etc.)

    Result? Problem solved, unless you simply don't believe that capitalism works.

  9. Hidden Charges from WalMart by Mr.Gibs · · Score: 5, Informative
    Well, they aren't exactly hidden, but the Walmart site states that you have to pay almost $18 for any CD that is lost by either you or the post office.

    I currently subscribe to Netflix, and at the rate they are either lost or stolen while in route back to the Netflix warehouse, I wouldn't want to be paying that for each one! Netflix has yet to charge me for those and state they won't unless it becomes frequent.

    Anyway, I'll be sticking to Netflix...

    --
    I live to gib...
  10. propane tanks by zogger · · Score: 5, Interesting

    That "walmart only, propietary" deal happend to me with a couple of my small refillable propane tanks. I got two from walmart, turns out they put a "walmart_only_ thread on the filler valve, you are forced to get filler-ups/exchanges only at walmart then, unlike my other ones that I can take anyplace handy.

    I didn't mind walmart when sam walton was still kicking, it seemed like they at least made an effort to have "made in USA" stuff in abundance, and didn't have weird polices like this propane deal (and what they will probably do with DVDs-good call there), but now,since he's died and who knows who is running it as an economic division of the chinese peoples liberation army, I've about almost completely removed them from sucking on my wallet. Once in a great while I get stuck, and have no recourse but to go in there, and every time I see aisle after aisle of lost homes, lost jobs, lost equity, lost cars, basically a lot of lost hopes and dreams disgusied as cheap trinkets, like what were used to purchase manhattan island. Trinkets, ohhh shiny and cheap.

    They are that-cheap. Cheap as in price, cheap as in quality, but very expensive with a bigger look at when once those dollars leave the shores of the US and cease acting as an economic force multiplier.