Wal-Mart bears down on NetFlix and Blockbuster

I think people are foolish to believe that video downloads are going to erode dvd rentals anytime soon. Until the technology trickles down to Nascar nation and you have the average Joe dowloading movies, which I don't see becoming the norm for at least another five years, I'll keep my money in companies already generating huge profits from DVD rentals ala Netflix.

The real story is the technology provider,HP Video Merchant Services. www.hp.com/large/dmp/video_merchant_services.html My bet is HP has negotiated the digital rights with studios, regardless of retailer. So I would predict other retailers, real soon, to announce their web store fronts utlizing this new HP service. Also if you read the info on HP's site, they mention physical delivery. This would allow making DVD's on demand for customers. HP is the enabler here. I would give them a close look, even as they close in on a 52 week high mark, as this is only the beggining.

The Walmart DVD download system IS a mistake and I'll tell you why. Downloads are going to cost $12.99-$19.99 and it takes up a ton of drive space, so most will burn it down to a blank DVD. They cost $3.00 each. Now I'm up to $23 for one movie. With Blockbuster I can view UNLIMITED movies for 17.99/month. If I really like a movie and want to add it to my library I can buy a previewed movie at Blockbuster for $5.99 and it comes with the COOL original box. The major studios aren't going to hurt their HARD DVD sales by allowing cheap downloads. That's why they insisted on this price range from Walmart. You need to get all your facts right before you write a blog.

With the class of people that shop at Walmart by the time they figure out how to order online rentals I will have sold my stock at a nice profit. Just think about it, most of them don't even have insurance let alone a computer!