Wal-Mart Controls the Future of Movie Downloads

The new iTunes movie store has been open a few weeks now, and still no other studios besides Disney are offering titles via the service. Why? Because Wal-Mart rules the world, of course. Over the summer, the retail giant gave a warning to Hollywood that it will not stand by and watch the studios concentrate on movie downloads while DVD sales are decreasing. Because Wal-Mart depends on DVDs to draw in customers and Hollywood has depended on the stores for a major share of their revenue (Wal-Mart is the leading seller of DVDs, which is Hollywood's biggest source of income), the studios would rather not offend the relationship. Sure, studios have partnered with other download services, but it wasn't until Apple decided to get in on the market with iTunes movies, that movie downloading had enough promise to scare the retail businesses.

So, what can Wal-Mart do? Well, first it can put a stronghold on the studios. After Disney's plan to partner with iTunes, Wal-Mart threatened to decrease its order of Disney DVDs, specifically the very popular seller, High School Musical. But that simply ignores the fact that downloads are the future, while also hurting their customers. So, in order to support progress and reap the rewards, it needs to get in on the download market. How? By pressuring Apple into giving the chain some of the profits. Wal-Mart is currently in discussions with Apple to start selling iTunes gift cards or coupons in stores, the proceeds of which will be divided between the companies.

My guess is that this kind of deal will keep iTunes from being able to lower their price on movies, though the Wal-Mart coupons will probably have an advantageous discount potential. So, if you want to let Wal-Mart continue bullying the world, make sure to give your lunch money to them by purchasing iTunes through their stores.