Walmart’s Online Movie Service Surpasses Amazon

Walmart has worked its way up to become one of the largest online movie businesses in the U.S. The retailer surpassed time-honored companies like Amazon and Sony, and even fired a direct hit at the top seller of movies, Apple’s iTunes store.

In 2010, Walmart earned $3.5 billion in revenues for Hollywood as the largest seller of DVDs in the U.S. However, disc sales are experiencing a huge drop with video streaming gradually becoming popular. All the while, Walmart has been persistently building an online dominance. The retailer started with discounted prices for on-demand digital movies to increase market value, and then purchased the online film store called Vudu.

Financial Times pointed out that Vudu’s share of the growing digital movie market, including digital downloads and online movie rentals “rose from just 1 percent in the first half of 2010 to 5.3 percent in the first half of 2011.”

Recently, Walmart introduced its Vudu service on the iPad, making the digital service available “anywhere and everywhere.”

But, Amazon is not doing bad either and has changed its online movie business to a streaming video-on-demand venture. The retailer even increased the number of movies and TV shows available on its instant video service with 100,000 titles available to buy or rent online.

In the meantime, Hulu, online video site owned by NBC Universal, Walt Disney and News Corp, is nearing a sale, and potential buyers are due to submit first found bids. And, Microsoft was the second-largest online movie retailer in the first half of the year, with its Zune Video Marketplace, according to IHS Screen Digest.

Now that Walmart is up with the big boys, it will be an interesting what happens with video streaming when 2012 arrives. It will be particularly interesting to see how YouTube and Facebook fare with their comparatively young online movie ventures. But, I am sure that iTunes will remain the top seller for some time to come.