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Walmart now streams videos on its website, in competition with Netflix

Tuesday, July 26, 2011 | 7:06 p.m. CDT

NEW YORK — Now playing: Movies at Walmart.com.

The world's largest retailer on Tuesday started streaming many movies the same day they come out on DVD, in a second bid for a share of popular movie rental and streaming website Netflix Inc.'s business and just two weeks after Netflix announced new price increases.

Wal-Mart Stores Inc. bought video-streaming service Vudu.com 18 months ago and now offers 20,000 titles that can be viewed on almost any device with Internet access, from computers to televisions to Sony's PlayStation 3 and other Blu-Ray disc players.

Movies are available at Walmart.com to rent from $1 to $5.99 or to purchase from $4.99 up. Walmart is not offering subscriptions, making its service more similar to Apple Inc.'s iTunes, which charges $3.99 to rent newly released movies and $14.99 to buy movies.

In addition to Netflix, another competitor streaming movies and TV shows by subscription is Hulu.com, which now offers a premium service for $7.99 a month with more back-season shows and more movies. Without a subscription, Hulu viewers can watch shows and movies free in exchange for watching advertising.

The movie offering fits with the Walmart website's strategy of offering a "seamless continuous shopping service," said Steve Nave, senior vice president and general manager of Walmart.com.

Walmart's announcement comes on the heels of Netflix saying it will increase rates and charge separately for streaming and rental DVDs. Its second price hike in eight months, Netflix's planned increases could amount to 60 percent for existing customers, starting Sept. 1. New subscribers have to pay the new prices immediately.

Netflix plans to charge $16 a month for services that used to cost $10 a month when bundled together, for example. It's still changing $8 a month for streaming, which it launched late last year. But instead of charging $2 more for a plan that includes one DVD at a time by mail, the company will charge $8 and up for DVD plans.

Customers have taken to social media sites Facebook and Twitter to vent their anger over Netflix's price increases, but executives said they anticipated the reaction. The company's willingness to risk alienating subscribers signals it needs more revenue to cover rising costs.

Through June, Netflix had 24.6 million subscribers in the U.S.

Walmart, based in Bentonville, Ark., has tested the movie-rental waters before. It previously offered a DVD-by-mail service that cost $12.97 per month for two titles and $17.36 per month for three titles. But it ceded that program to Netflix in May 2005, letting customers continue their subscriptions with Los Gatos, Calif.-based Netflix without a rate hike. Apple is based in Cupertino, Calif.


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