Wal-Mart Cancels DVD Rentals

    May 19, 2005
    WebProNews Staff

New partnership with Netflix connects Wal-Mart’s movie sales business with Netflix’s rental operations.

The two companies have agreed to a promotional arrangement, and will market each other’s offerings on their web sites.

Wal-Mart will cancel its DVD rental business in favor of letting Netflix handle that aspect of the business. Customers interested in rentals will be referred to Netflix. Existing Wal-Mart DVD rental subscribers may become Netflix subscribers at the current Wal-Mart rate for one year from the date they sign up for the service.

Netflix will promote Wal-Mart’s online movie sales, plus its pre-order price guarantee, on the Netflix web site. The pre-order guarantee simply means a customer will get the best price available for a movie when it is released for sale.

“We’re equally excited to team with Netflix, the pioneer of online movie rentals, which not only distinguishes both of our core online competencies, but offers a complementary solution of value, service, and convenience to customers,” said John Fleming, Wal-Mart’s executive vice president and chief marketing officer who also oversees Walmart.com at the executive level.

In an additional press release, Netflix said the promotional agreement was not material to the company’s current subscriber growth or its financial performance. Therefore, it will not revise financial guidance it released last month.

David Utter is a staff writer for WebProNews covering technology and business. Email him here.