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Wal-Mart Turns Over DVD Rentals to Netflix

prostoalex writes "US retail giant Wal-Mart is turning its DVD rental business to Netflix. No word on how much money the deal is worth but Netflix will feature promotional Wal-Mart links for the 100K customers it gets from the retail chain."

24 of 384 comments (clear)

  1. Wal-mart censorship by Lovesquid · · Score: 4, Insightful

    Anyone know if Wal-mart censors their DVD rentals like they do with their retail CDs/DVDs? I know I won't shop there for this reason.

    1. Re:Wal-mart censorship by Anonymous Coward · · Score: 4, Insightful

      And you know what? It's your right not to shop there because you disagree with their censoring. And it's Wal-mart's right to censor what they sell so people who WANT the censored material can get it.

    2. Re:Wal-mart censorship by eln · · Score: 4, Informative

      This is a cross-promotion agreement, not Wal-Mart taking over Netflix's DVD selection. Wal-Mart's DVD rental business was not really very large, with only about 100k customers to Netflix's 3 million. Wal-Mart never really heavily promoted their offering, and I think they just figured it would be a lot more cost efficient to leverage Netflix's massive existing infrastructure specializing in this sort of thing rather than trying to maintain staff of their own for something that is destined to be a very small portion of their overall business. On the radio, they noted that Netflix reported revenue of $506 million for the entire year. Wal-Mart, by contrast, makes that much in revenue in LESS THAN A DAY.

      This is not unprecedented of course. Wal-Mart allows other people to provide services under contract rather than providing those services themselves in their own stores. Examples would be things like McDonalds, and the other Cafe-style things that are in the front of every Wal-Mart, and are not owned or run by them.

    3. Re:Wal-mart censorship by killmenow · · Score: 5, Insightful

      I don't know, but I could imagine a scenario wherein NetFlix provides what amounts to a fulfillment service to Wal-Mart under the Wal-Mart name and maintains its own NetFlix branded rental service.

      Then, if Wal-Mart says: no NC-17 movies, etc., on our branded service, fine. So long as the people who are interested in it can still get it under the NetFlix name, I don't care if Wal-Mart wants to filter their product.

    4. Re:Wal-mart censorship by ReverendHoss · · Score: 5, Funny

      Hmmm...I wonder how a censored pr0n movie will be like

      Short.

    5. Re:Wal-mart censorship by Big_Al_B · · Score: 4, Insightful

      Er, how does a *store* choosing what merchandise to sell to *customers* who choose to shop there constitute censorship again?

      If that's censorship then I guess my local whole foods market is guilty too, because they don't carry Cap'n Crunch Peanut Butter Crunch. All they carry is some crappy organic peanut butter puffs. The *bastards*.

    6. Re:Wal-mart censorship by Rude+Turnip · · Score: 5, Funny

      "can you help me find the pr0n section?"

      Well that's your problem. They probably think you're looking for small, delicious crustacean.

    7. Re:Wal-mart censorship by yotto · · Score: 4, Funny

      *Hmmm...I wonder how a censored pr0n movie will be like*

      Plumber comes in, offers to snake the pipes. Housewife smiles at him seductively... ...And the plumber leaves the house.

    8. Re:Wal-mart censorship by Gadgetfreak · · Score: 4, Interesting

      Correct, it's not actually censorship in the true sense of the word. A better description would be that Wal-Mart's business decisions are a "very powerful influence."

      My girlfriend works for a label manufacturer that prints labels for a well known motor oil company. They've had to re-design labels entirely, because the bottle that the company uses had changed shape. The exclusive reason is because Wal-Mart did not like the way the bottle handle was positioned when they were put on the shelf. So a multi-million dollar repackaging was set in order.

      Any manufacturer of consumer products, or even services as this case seems to be, stands to lose a TON of revenue if Wal-Mart decides that they don't want to play ball with you anymore.

      There's no doubt that Netflix would be persuaded to do just about anything that Wal-Mart requests of them.

      --
      "No fair, you changed the outcome by measuring it!" - Professor Hubert J. Farnsworth
    9. Re:Wal-mart censorship by Jherek+Carnelian · · Score: 4, Interesting

      Then I started watching them... and noticed DUBBING over some swear words... WHAT THE HELL? Scenes were missing... the same ones that USA or TNT would cut out (In the Lawnmower man, the only GOOD parts were removed). Needless to say, I was SO furious, I too refuse to shop at the place

      I don't believe you. Producing an edited version and an unedited version of a DVD is an expensive proposition and not something a studio is going to do for DVDs that sell for ~$5. It would almost certainly be a money loser even at the volumes wally-world buys at.

      I purchased lawnmower man from the same wal-mart dump bins. So, please post the timecode for an example of this editing and I will go and try to confirm it on my copy tonight.

    10. Re:Wal-mart censorship by Big_Al_B · · Score: 4, Funny

      What do you do when Wal-Mart is the only game in town?

      Well, I'd mosey over to the next town, I s'pose. Course'n I might need an auto-mo-bile fer that.

      Or I may shop online. Or by mail order. Or have a cityslicker cousin buy movies for me.

      Inconvenience is not censorship.

    11. Re:Wal-mart censorship by dr_dank · · Score: 4, Informative

      Agreed. Wal-mart's buyers are notorious. They can and will dictate how a supplier can do business with Wal-mart, to the point where a supplier (Rubbermaid was a well known example) would have to open their books to Wal-mart to see where "inefficiencies" could be found.

      --
      Where does the school board find them and why do they keep sending them to ME?
  2. Hey Blockbuster... by LegendOfLink · · Score: 4, Funny

    You can kiss your ass goodbye...Always.

  3. A Win For The Little Guys by blueZhift · · Score: 4, Interesting

    Hooray for a rare win for the little guys! I've been a Netflix customer since the beginning so I'm happy to see a deal that promises to keep Netflix around a little longer. That just leaves Amazon and Blockbuster. Personally, I'd like to see Amazon do a similar deal with Netflix rather than try to crush them. Why? Because Netflix has become a good brand in the DVD mail rental space, so Amazon may have more to gain teaming up with them than fighting.

  4. Competition by MyLongNickName · · Score: 4, Insightful

    It seems to me that the there is really only room for one DVD rental-by-mail service. It is one of those commodity items that becomes cheaper to run on a per-customer basis the more customers you have. Netflix got rid of a potential competitor and gained an influential ally in the process. Now, they have to deal with Blockbuster.

    In five years, only one will remain. Who will win? My money is still on Blockbuster, but the odds have definitely shifted.

    --
    See my journal for slashdot ID's by year. Mine created in 2005. http://slashdot.org/journal/289875/slashdot-ids-by-year
    1. Re:Competition by mattmentecky · · Score: 4, Insightful

      It seems to me that the there is really only room for one DVD rental-by-mail service. It is one of those commodity items that becomes cheaper to run on a per-customer basis the more customers you have. Netflix got rid of a potential competitor and gained an influential ally in the process. Now, they have to deal with Blockbuster.

      *bangs head against his Capitalism Fundamentals 101 book*

      Excuse me?! I really really hope you didnt mean to imply that your perceived one-player-DVD rental system is a *good* thing but good gosh man, it certainly certainly will not be cheaper!

      Too often people such as the parent here get tangled up in a business idea that seems simple to reproduce or that there are many players (businesses) that are identical and then cast that area of business as needing only one of said businesses to exist. To that I say no! No no no no. Look at Coke and Pepsi. Virtually the same damn thing and both do very well! And we as consumers benefit. Microsoft has a 90% stranglehold on marketshare, would you say that we benefit in quality, cost and inovation in their one-player-sytem?

  5. Re:WalMart = Microsoft of retail by geoffspear · · Score: 4, Insightful
    Nah, it's just outsourcing. Giving up the market would involve shutting down their service altogether instead of getting someone else to do it.

    And apparently they were smart enough to realize that a DVD-by-mail service for US customers just can't be run out of China for cheaper.

    --
    Don't blame me; I'm never given mod points.
  6. The stuff billionaires are made of by RealProgrammer · · Score: 5, Interesting

    Wow, hooray for Netflix, I guess.

    Netflix should figure out a way to use Wal-Mart as a local cache. For the hottest releases, you don't have to wait for the thing to be delivered (or even downloaded and burned >-). You hand the Wal-Mart electronics guru your Netflix card, and they put your name in the computer.

    There's got to be a way to make that work more cheaply than mailing each one.

    --
    sigs, as if you care.
    1. Re:The stuff billionaires are made of by revery · · Score: 4, Funny

      You hand the Wal-Mart electronics guru your Netflix card

      guru?!?!

      In which parallel dimension have you been shopping and how do I get there?

  7. Re:Blockbuster campaign by Lovesquid · · Score: 4, Interesting

    I managed a Blockbuster for 2 years. Worst job I ever had. Seemed like every single day there was either a lawsuit pending from someone who got screwed over, or a mistake on late fees that I had to accept being screamed at about (like it was my own personal fault), or $500 in shoplifting loss (it happens when you have enough hours to staff only 1 employee most of the time). Nothing is more mind-numbing that repeatedly opening then closing like 2000 video/DVD cases per day to verify their contents.

    I mean all retail jobs blow monkey dick, but this one blew Kong. I've never set foot in any Blockbuster store since I left.

  8. Re:Summary has it backwards by east+coast · · Score: 5, Insightful

    Walmart bought Netflix, not t'other way round.

    From what I read no one bought anyone. Netflix is going to get the old Wal-Mart customer base but NetFlix is going to offer a sales link to Wal-Mart. I don't see it as a buy and sell but rather allowing each company to focus on either rental or retail. If anything both sides stand to profit from this; NetFlix gets the customer base on rentals and Wal-Mart can focus on the retail DVD market while dumping what was probably a less than profitable side venture along with what is basically free advertising from NetFlix.

    --
    Dedicated Cthulhu Cultist since 4523 BC.
  9. 100K-1 by jmichaelg · · Score: 4, Interesting
    I got an email from Walmart this morning telling me about the change over. The email had a link that took me to a page on Walmart's site explaining they were shutting down. On the page was a button that said "Click here to get your account transfered to Netflix" along with some text that explained my rental queue and terms of service would be transferred intact by clicking on the button.

    Didn't work that way. Got transferred to Netflix's new account page with the wrong service option selected and everything else blank. Had the software worked properly, I would now be a Netflix customer but it didn't so I checked out Blockbuster's offer. So if anyone at Netflix is reading this, especially if you're the developer, your bug cost you a customer. Blockbuster looks to have a better deal than Netflix - something I probably wouldn't have noticed had your code worked properly.

    It's a shame Walmart quit. When they entered the market, Netflix raised their monthly service fee, realized that wasn't the brightest thing to way to compete with the world's largest retailer and subsequently lowered their fees to match Walmart's. Both companies then proceeded to add a whole lot more titles to their mix - or at least claim they did. The overall effect of Walmart's entry into this field was to increase competition and improve the offerings. I frequently saw a 2 day turnaround from mailing a DVD to receiving its replacement. With Walmart's exit, I wouldn't be surprised to see a concurrent dimunition of service from the remaining players.

  10. great... by patrick.whitlock · · Score: 4, Informative

    I live in north Alabama (stop laughing). and yes, Wal-mart is big in my neck of the woods. But if you think Microsoft is evil, you should look at Wal-mart a bit more closely. A town near me at one time had 3 grocery stores. now, they have A wal-mart. 3, count em...3 locally owned buisnesses have been shoulderd out of the picture by a large multi-national company. 3 economy helping buisnesses have closed thier doors. so, now.. you have to shop at wal-mart, or drive 20+ mins to the closest grocery store. I figure that each store had at least 40 employees. that's 120 people now out of a job, and wally world hasn't got that many employees. so... we've increased the unemployment, decreased the number of locally owned buisnesses, and made one hell of a traffic jam. now they want to take out the movie rental places. Somehow i don't think Sam Walton would appreciate this

  11. Good - WalMart SUCKED as a rental service by artifex2004 · · Score: 5, Informative

    WalMart shipped from Arkansas, so you can imagine how long it took for disks to travel back and forth to the rest of the country. It was usually a 2-3 day trip each way here to Dallas, Texas, for example. And the selection was even worse than Blockbuster's online service, if you can believe it.

    I've belonged to 4 rental services, and this is the order I rank them:

    customer service:
    1) Greencine (usually a few hours for email reply during the day, some of the staff seem to remember you by name, and they also often show up in the discussion boards),
    2) Netflix (known for throttling service sometimes (less often these days), and takes a couple days to answer emails)
    3) WalMart
    4) Blockbuster far behind. 3-4 days to answer emails, empty slots when I had a queue of hundreds for a couple days at a time and each of them was supposedly "available now" - and I live within 30 miles of the national headquarters and the main distribution center.

    selection:
    1&2) Netflix, Greencine. GC has a better anime selection for now, as well as more hard to find foreign titles. Netflix has much better availability on almost every title it actually stocks, and is edging up on the anime. But it's still not there with foreign titles, either. Best selection for most people, however.
    3) Blockbuster had mostly the same titles you'd see in its stores. But as I said earlier, a lot of them weren't really available when they claimed they were.
    4) WalMart basically had a subset of what Blockbuster did. They did keep the slots full, however.

    speed:
    1) Netflix! They win by a landslide, having dozens of distribution centers, so there's probably one near you. However, they have been known to throttle customers after the grace period, and some of those "shipping tomorrow" or "shipping in [two days]" messages look suspicious. They don't do shipping or receiving on Saturdays, unfortunately.
    2) Blockbuster. They have a number of distribution centers, but they are slower to process returns and mailing out. Not to mention that I had empty slots for days, several times. I think I may have seen them ship/receive on Saturdays, though.
    3) Greencine. Unfortunately, their one center in California is their Achille's heel, as it takes days for anyone outside the region to get DVDs or send them back. It usually takes 2-3 days for a disc to get to Dallas, and 4-5 days to get back to California. The postal service seems spotty in this regard. Note, they DEFINITELY work on Saturdays as well, which is very important in their case.
    4) Walmart's center is in Arkansas. They're about as slow as Greencine. No, I don't think they work on Saturdays. Sometimes I wondered if they worked on Mondays and/or Fridays, either...

    overall value:
    Netflix is the best overall value for most people; I usually get 15 discs a month on the standard 3-out plan. I get 9 discs from Greencine on average with their 3-out plan, but I'm a foreign film fan who sometimes watches anime, so I'm keeping them around. I will say that last fall I dropped NF and kept GC, but GC had some customer service and shipping problems in January and February, so I restarted NF to supplement. Blockbuster shipped somewhere between Netflix's average and Greencine's, but their selection and customer service makes them not worth the trouble. Seriously. I canceled at the end of last year. And WalMart shipped about as many as GC, so they'd have been a nonstarter even if they weren't shutting down, now. I cancelled within 2 or 3 months, I think :)