Wal-Mart launches digital movie downloads

Retailer kicks off its own video downloads service beginning with an exclusive 'Superman Returns' DVD bundle.

By Parija B. Kavilanz, CNNMoney.com staff writer

NEW YORK (CNNMoney.com) -- Wal-Mart Stores on Tuesday announced the launch its own video downloads service beginning with an exclusive "Superman Returns" DVD bundle containing a video download option with purchase of the physical DVD.

CNNMoney.com first reported in September that Wal-Mart (Charts), the world's largest retailer, had accelerated its efforts to launch a digital movie service before the end of the year.

Wal-Mart currently accounts for about 40 percent of all DVD sales in the United States. By launching its own service, industry watchers say Wal-Mart can protect that DVD market dominance.

In a press release, Wal-Mart said the service is now available to its customers in all Wal-Mart stores nationwide.

With the purchase of the "Superman Returns" physical DVD, Wal-Mart said customers can also choose from three video download format options -- $1.97 for portable devices, $2.97 for PCs/laptops, and $3.97 for both portable players and PC/laptops.

The retailer said the physical/digital DVD bundle would offer customers the flexibility to watch the Warner Bros. movie on their TV, portable devices as well as their computers.

Warner Bros. is a division of Time Warner (Charts), parent company of CNNMoney.com.

According to Wal-Mart, the Superman Returns physical DVD will come with a video download "feature sticker" on the cover. Customers will then have to log on to walmart.com/superman, enter the promotional code, and select their desired download format.

Once users create an account and install the video download manager, the purchase completes and the movie download process begins. Wal-Mart said customers can also begin watching the movie while it downloads.

Wal-Mart said it will also test additional DVD bundles as well as offer a beta version of a video downloads service. The beta launch will feature both movie and television content from a number of studios and TV networks.

This wouldn't be the first time that Wal-Mart has attempted to make headway in the digital movie marketplace. Wal-Mart's online movie rental service failed. Walmart.com now refers customers to Netflix (Charts) for movie rentals.

Industry sources said Wal-Mart was eager to get its own download service up and running especially after both Amazon (Charts) and Apple (Charts) unveiled their own movie download services in September.

Correction: An earlier version of this story stated that Wal-Mart will launch the service on Wednesday, according to Wal-Mart's initial press release. Wal-Mart subsequently corrected the information and said the service launches Tuesday.

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