Fascinating potential battle brewing in the SVOD space...
Traditional big-box retailer enlists old-media veteran to challenge the streaming giants...
Basically, it’s like a corporate version of ‘Uncle Drew.’
Traditional big-box retailer enlists old-media veteran to challenge the streaming giants...
Basically, it’s like a corporate version of ‘Uncle Drew.’
$NFLX down ~5% today, and the mere whiff of Walmart breathing down its neck is probably why. I'll believe their market entry when I see it, but here's why this should be taken seriously. Thread...
Walmart is not some Johnny-come-lately looking to dabble in the video business. They were a dominant force in the DVD biz in its heyday, and segued online more recently with its Vudu brand. Not exactly a raging success story though...
Vudu made the mistake of mimicking Apple's iTunes, which put too much emphasis on the electronic-sell-through model than the lower-margin rental model. Netflix succeeded by sticking to the latter.
$WMT has knowledge, infrastructure and brand clout; they aren’t starting from scratch. In-store promotion for a new service could go a long way, though bigger promotional footprint opportunities have been squandered before...
Redbox’s inability to pivot from ubiquitous kiosks to streaming is downright tragic. They haven't given up though (good luck with that)... consumerreports.org/streaming-vide… 
Yes, Walmart is moving late to the game too, but it's a game still in the early innings. Walmart doesn't have to rival Netflix or Amazon to score a win here, there may be enough market share available to amount to a meaningful business even as a relative also-ran.
Dominant as Netflix is in the early going 💪, perhaps there’s enough content to pull together at low enough a price point to appeal to a sizable late-adopter market segment just sitting there for Walmart to scoop up.
There's a notion floating around that Walmart will target middle America. That smells like a false narrative. I'm not so sure I buy that the flyover states are a bunch of Luddites that Netflix has barely penetrated because it's too busy catering to coastal elites.
It's also a seductive narrative because of something I believe to be all too true: Hollywood is overlooking a massive original content opportunity catering to conservative-minded audiences.
But I find it hard to believe that Walmart or anyone has the cojones or 💰💰 to pursue that kind of targeted original content strategy. More likely Walmart would at least start with a catalog-centric approach and see how that goes before venturing into originals of any kind.
What I would bet on is that no matter what shape or form a Walmart SVOD foray takes, it will include commercials, a la early Hulu. How can Walmart come in at a lower price point than Netflix without doing that?
If Netflix has a vulnerability, that just might be it.
If Netflix has a vulnerability, that just might be it.
And if there is an executive who has been around long enough to spot a hidden Achilles heel the category leaders might have in the marketplace, it’s the man Walmart enlisted, Mark Greenberg. Another reason not to underestimate the challenge Netflix + Amazon might be facing #END
