Wal-Mart has officially entered the commercial download video business with more ammo than Apple's iTunes: all six major Hollywood studios. Apple has only Disney as a full partner, with Paramount only testing the waters but not committing to releasing new flicks on iTunes. Warner Brothers, Sony, 20th Century Fox and Universal have all said "no thanks" to Jobs while accepting Wal-Mart's invitation. Jobs lost out because Apple would not change its $9.99 price tag and only Disney ended up agreeing to the revised pricing scheme of $9.99 for catalog titles, $12.99 for launch releases, and $14.99 for new releases.
Wal-Mart, on the other hand, has met the studios' demands and will be pricing movies from $7.50 to $19.98 (Classics will not exceed $9.98 ). The company will have new downloads on the same day as their DVD release, and they will also host $1.96 TV shows from Fox, CW, MTV, Nickelodeon, Comedy Central, Logo and VH1 (ABC, NBC, CBS nowhere to be found). The feature set does not, however, include burnable DVDs, easy sharing between devices or high-definition. The only differentiator is that by using Microsoft's DRM, the studios can puts tabs on sharing.
Wal-Mart's capitulation to the studios is no surprise: both sides do not want the price of physical DVDs to be affected by Apple's success. Ars Technica believes the studios will end up realizing that Apple is where the money is being made, simply because of the number of movies sold. I don't think Wal Mart will do as badly as some may think. The final showdown will be whether users will be happy with smaller prices and a smaller movie library or larger prices and a larger library.
News source: Ars Technica