Wal-Mart threatens retaliation against Hollywood studios if they sell movies via Apple’s iTunes

20 years ago

“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/