Walmart to Purchase VUDU

Parks Associates research indicates U.S. premium video rentals and downloads will grow to $8.4 billion in 2014

After abandoning its initial online video plans in late 2007, Walmart has returned to this market with the announced acquisition of VUDU on February 22. With Best Buy working with Roxio CinemaNow, will Walmart leverage the VUDU acquisition to develop its own branded connected CE products?

Walmart is re-entering the OTT (over-the-top) market at an opportune time. Parks Associates forecasts that revenues for premium video rentals and downloads in the U.S. will grow from $2.3 billion in 2010 to $8.4 billion in 2014.

Given VUDU’s recent efforts to transition from a hardware vendor providing set-top boxes to a backend service provider of OTT content for connected CE devices, Parks Associates believes that this acquisition is an opportunity for Walmart to become a “category catalyst” in connected consumer electronics. VUDU currently is working with such CE vendors as LG, Mitsubishi, Samsung, SANYO, Sharp, Toshiba, and VIZIO.

Parks Associates projects that by 2014, more than 40% of transactional revenues for premium online video services will be through connected devices such as connected TVs, Blu-ray players, game consoles, and networked digital media set-top boxes. The presence of Walmart, with its retail muscle now in the online video space, could mean significant growth in the number and availability of Web-enabled consumer electronics products.

Wal-Mart Acquires VUDU - low-cost connected CE for everyone!

After bailing on online video in late 2007, Wal-Mart is back in the game with the announced acquisition of VUDU. With Best Buy working with Roxio CinemaNow, I can see Wal-Mart taking VUDU and developing perhaps their own branded connected CE products.

Nagravision and Samsung Internet@TV Partnership

This was interesting news, particularly since we completed a Webcast today where we talked about the very dymanic market for supplying Web capabilities to the consumer electronics market. Today, Nagravision announced that it was partnering with Samsung Electronics America to provide TV applications an interactivity to Web-connected Samsung products such as connected TVs and Blu-ray players.

It's interesting that a company like Nagravision - which has a strong foundation in providing content protection, delivery, and interactive features to pay-TV providers is working with consumer electronics companies. At a time in which we are seeing different actors - including broadband service providers such as France Telecom; online video providers such as Roxio CinemaNow; and broadcasters (particularly in Europe with the Project Canvas and HbbTV efforts - all developing solutions to bring more content and services to the connected TV, Nagravision's announcement should be one of many that we hear in this developing space.