Walmart, MGM to boost on-demand video service
Walmart Inc.will partner with movie studio Metro Goldwyn Mayer (MGM) to create exclusive content for its video-on-demand service Vudu, according to media reports on Monday.
Walmart has been looking to prop up Vudu’s monthly viewership that remains well below that of competitors like Netflix and Hulu, which is controlled by Walt Disney, Comcast and Twenty-First Century Fox.
In July, the company announced the launch of its video streaming service, Vudu, an affordable streaming service in the U.S. as it looks to attract more consumers to its digital offering. The company recently hired Mark Greenberg, former Chief Executive Officer of Epix -- a cable network veteran, according to Variety.
According to CNBC, Walmart and MGM will make the announcement at the NewFronts conference in Los Angeles on Wednesday. It will include the name of the first production under the partnership, which Walmart will license from MGM.
“Under this partnership, MGM will create exclusive content based on their extensive library of iconic IP (intellectual property), and that content will premiere exclusively on the Vudu platform,” Walmart spokesman Justin Rushing told Reuters.
The focus will be on family-friendly content that Walmart customers prefer, Rushing said.
Licensing content is a cost-effective strategy at a time when producing original content has become a costly venture, according to CNBC. As of July, Netflix said it was spending $8 billion a year on original and acquired content. Amazon.com’s programming budget for Prime Video was more than $4 billion, while U.S. broadcaster HBO, owned by AT&T, said it would spend $2.7 billion this year.
Walmart acquired Vudu in 2010 to safeguard against declining in-store sales of DVDs. Walmart bet that customers would continue to buy and rent movies and move their titles to a digital library, which Vudu would create and maintain for viewers, according to CNBC.
The financial deals of the deal were not disclosed.
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