“Worried about its massive DVD sales, retail behemoth Wal-Mart has told some of Hollywood’s biggest players it will retaliate against them for selling movies on Apple’s iTunes,” Tim Arango reports for The NY Post.
“Last year when Disney announced it would begin offering episodes of the hit shows ‘Lost’ and ‘Desperate Housewives’ on Apple’s iTunes, the reaction of the world’s largest retailer sent shockwaves through the entertainment industry,” Arango reports.
“Wal-Mart, worried that offering the shows for viewing on iPods would cut into DVD sales at its stores, sent ‘cases and cases’ of DVDs back to Disney, according to a source familiar with the matter,” Arango reports. “Now, following Apple’s entrance in to the business of selling full-length films for download, the battle between Hollywood and its largest client is getting uglier, as studio executives say Wal-Mart has overtly threatened to retaliate if they go into business with Apple.”
“The last thing studios want to do before the holiday shopping season is to offend their biggest sales outlet; the studios, collectively, rely on Wal-Mart for some $5 billion of DVD sales in the fourth quarter,” Arango reports.
“But several weeks ago, in the midst of rumors that Apple was close to announcing a deal with Disney, Wal-Mart’s David Porter – the executive responsible for stocking the retailer’s shelves with DVDs and CDs and whose influence is so immense in Tinseltown that he’s been named to Premiere magazine’s annual power list – made the rounds of Hollywood studios,” Arango reports. “His message, according to a studio exec involved in the discussions: that there would be ‘serious ramifications’ if the studios hopped in bed with Apple.”
“‘They threatened to hurt us in terms of buying less products,’ said this person. The situation between Bentonville and Hollywood has gotten so heated and so high-level that Jobs recently phoned Wal-Mart CEO Lee Scott to ask him to moderate his stance, according to a source,” Arango reports.
Full article here.
Even a low-class anticompetitive cancer like Wal-Mart won’t be able to hold back the future. Wal-Mart logic: we can undercut every business in every town in the world, but you can’t do it to us. If you agree with that logic, by all means shop at Wal-Mart.
WAL-MART: The High Cost of Low Price: http://www.walmartmovie.com/
Related articles:
Wal-Mart: we’re not fighting iTunes Store movie downloads – September 23, 2006
Wal-Mart not happy with looming threat of Apple iTunes movie downloads – August 31, 2006
Wal-Mart loses ‘philosophical argument’ with Apple CEO Steve Jobs, gains top-selling iPod – November 29, 2005
Nice take, MDN
Oh, poor baby, did little Wally-mart feel an oww-eee. What a frigg’n crock. Hey WM, just stock up some more picture frames, bed pillows and a few more cases of motor oil, y’all ought’a be able to find something to sell if Apple takes the wind out of your DVD sales, you freak’n loser! I’ll never shop at Walmart again.
This depends on the % of a studio’s total DVD sales that are via Wal-Mart. Wal-Mart has successfully been able to force suppliers of other goods to change because they represent such a huge % of that supplier’s total sales. I believe MDN is correct regarding the long term, but this could be a factor that slows growth of iTS (iTunes Store) movie sales. That’s a bad thing, but the influence of Wal-Mart is some monopoloy-era shit. Don’t underestimate it.
Not only that, but Wall-Mart is preparing their own online movie downing business. So this posturing is only to better leverage themselves into the downloading market, while keeping Apple out. Monopolistic capitalism at work.
Walmart is evil in every way. They ruin businesses and land. I love when they bulldoze trees and nice land to put a super Walmart right down the street from a couple year old one, you really gotta love that. The way they make our economy so nice.
What is the leverage that Wal-Mart has over the studios? If Wal-Mart stops carrying DVDs, then I’ll go to Target or Best Buy, or K-Mart or….
WalMart is a pestilence on society. In any case, I doubt the “Walmart crowd” is sophisticated enought to be downloading movies anyway…so they probably wouldn’t lose much business anyway. What pricks.
I posted this on another venue:
I’m taking all bets against Wal-Mart. Hollywood, for all their deficiencies, does know on which side their bread is buttered, and they aren’t going to let the distribution model of the 20th Century hold back the distribution model of the 21st.
Wal-Mart’s threats are empty. They are struggling to show quarterly increasses in same store sales. Over the past 30 months (2 1/2 years) Wal-Mart’s stock has declined 20% in value, dropping from $60 to $48 today. They will not throw away $5 Billion in quarterly revenue to spite Hollywood.
Disney’s iTunes revenue will inure Hollywood from these hollow threats.
Wal-Mart can go screw themselves. They only sell censored music and movies anyway. So much for the customer being the boss, eh? It will be a great day when these sorts of repressed, faux-moraliastic losers no longer control what we see, hear, and purchase — and again, Apple leads the way…
v-word: normal
Now quote a source who actually asked for a comment from Walmart and Disney:
link
Isn’t this illegal? I don’t understand how they’re doing this and no one is filing charges. This is the same crap that got M$ into trouble isn’t it?
This almost smacks of anti-trust violations. Maybe the Feds should get involved.
New Link:
<a href=”http://yahoo.reuters.com/news/articlehybrid.aspx?storyID=urn:newsml:reuters.com:20060922:MTFH49922_2006-09-22_23-34-23_N22181208&type=comktNews&rpc=44″ target=”_blank”>here</a
Bravo to MacDailyNews for linking to the OUTSTANDING DOCUMENTARY “Wal-Mart: The High Cost of Low Price”.
This movie shows the FACTS on how Wal-Mart is one of the most evil corporations in the history of the world — doing irreversible damage to human beings, neighborhood communities, our environment, and other businesses. Wal-Mart is a truly evil corporation.
If you haven’t yet seen the movie, please rent it immediately:
Wal-Mart: The High Cost of Low Price
http://www.walmartmovie.com
Wal-Mart is right up there with Monsanto and the oil companies as one of the most evil companies of all time.
These are the actions of a company that is SHIT SCARED of the future.
Lets face it – in 10 years time no one will be buying dvds/cds from stores, all music, movies and games will be downloaded.
The X-box is a case in point, computer games makers will be putting their games on a server and u will download them to the x-box.
Even Walmart cannot stop progress, and looking at the amount of sales Disney has had in only 1 week means that walmarts days are numbered.
Walmart do not have the expertise or ability to compete with Apple or any other movie download service and they know it too.
Welcome to the future of retail Walmart!!
Wal-Mart disputed the Post report and said it was not pressuring movie studios into shunning online delivery.
“Customers want to watch movies and they want to be able to make the choice when and how they want to view them,” a Wal-Mart spokeswoman said.
“While we recognize there are various current and potential providers of this service, we are not dissuading studios from conducting business with other providers.”
A Disney spokeswoman said she was not familiar with the claims in the Post report. An Apple spokesman could not be reached for comment.
The source, who declined to be identified, said the discount retailer learned over the intervening months that customers who download — primarily young, single males — are not the same as those customers who buy DVDs.
Easy, there…
Saying that ‘Wal-Mart is evil’ might be overstating just a tad… Wal-Mart is doing the same thing that businesses do every day – leveraging their market power to maintain their customers. Your drug store, grocery store, auto parts business – hell, even your dry cleaner is probably doing the same thing. The fact that Wal-Mart is enormously successful simply brings everything they do into sharp relief.
Apple, by starting to sell movies, is diving into a very large pool with very big sharks. It would be silly for Apple to come into this business like some little p**sy at a pick-up game crying foul whenever he gets checked, and I’m sure that Jobs & Co. were well aware that this move would ruffle some enormous feathers.
Instead of bad news, this merely shows the overwhelming confidence that Steve has in business model. So just stop crying like little bitches, sit back and enjoy the fight. It’s gonna be good…
(Sorry for all the mixed metaphors)
If this is true – and it certainly seems to be all over the Internet, not that that’s any guarantee of veracity – Apple should threaten retaliation by “reducing” the amount of iPod stock that they can allocate to Wal-Mart globally and instead focus on distributing to independent Electronics/Computer stores.
Wal-Mart may be able to boss Hollywood around, but Apple has a hot product and they should use it as a economic/political tool to get the market landscape that they want.
Wal-Mart bulldozes new land to create new Wal-Marts a few miles away from existing Wal-Marts, so they can get out of paying taxes on the previous Wal-Mart which was subsidized by the community. They are more evil than you can even begin to imagine. Watch the movie: http://www.walmartmovie.com
Fantastic Realist you are apparently not – the money that Wal-Mart makes on DVD sales dwarfs the money they make on iPod accessories. Not much of a threat…
Hey grok, you don’t know what you’re talking about. Why don’t you watch the movie “Wal-Mart: The High Cost of Low Price” and you can see with your own two eyes how Wal-Mart is evil in EVERY sense of the word. There is absolutely NOTHING good about that company AT ALL.
Wall Mart can burn in hell for eternity before I buy one more single item from them.
Scumbags.
Walmart is basically trying to coerce the studios to violate the Sherman Act. Agreements to boycott a competitor are illegal, and it won’t happen. I really don’t think Walmart wants to go down that road with all the well-deserved bad PR they’ve got already.
The Sherman Antitrust Act, formally known as the Act of July 2, 1890, ch. 647, 26 Stat. 209, as amended, codified at 15 U.S.C. § 1 through 15 U.S.C. § 7, was the first United States federal government action to limit monopolies.
The Sherman Act provides: “Every contract, combination in the form of trust or otherwise, or conspiracy, in restraint of trade or commerce among the several States, or with foreign nations, is declared to be illegal” (see 15 U.S.C. § 1). The Act also provides: “Every person who shall monopolize, or attempt to monopolize, or combine or conspire with any other person or persons, to monopolize any part of the trade or commerce among the several States, or with foreign nations, shall be deemed guilty of a felony [. . . ]” (see 15 U.S.C. § 2). The Act put responsibility upon government attorneys and district courts to pursue and investigate trusts, companies and organizations suspected of violating the Act.
Under the law, corporations can qualify as persons under the law. Wal-Mart is attempting to use it’s market power to keep a particular competitor, Apple Computer, from selling video content. Note that they are not opposing Amazon, which currently offers more titles from more studios.
Apple has a case & Disney has a case. Wal-Mart has stepped on their corporate crank.
Now the big question:
Does Alberto Gonzales have the cojones to do his job and enforce the law or will Apple & Amazon have to do it for themselves?
Hey MacBill, I saw the preview – I get the recipe… Mix some shots of Superstores, add a dash of disgruntled ex-employees, throw in some sinister music, a dollop of unsubstantiated and unlitigated claims, steep in the tears of a couple of Mom n’ Pop businesses that can’t survive without raping their neighbors on prices, and you’ve got one hell of a good fish stew.
Simply put, If Wal-Mart is such an evil corporation, running rampant over the law, then why aren’t they in trouble? If people hate them so much, why does everyone shop there? Work there? This Wal-Mart hysteria has gone the black helicopter route.