Netflix is one of the top picks when it comes to streaming, in a landscape that includes the platform's main rivals: Amazon and Hulu. Might that be about to change? Well, it might be if Walmart has anything to do with it. That's right, the retail empire is currently considering adding a new item to its arsenal -- a streaming service. Here is what you need to know.<doc-sep>According to The Information, Walmart is considering a streaming service of its own, which could cost less than $8 per month. An $8-a-month subscription plan would be lower than the current price of Netflix and Amazon. It could be a sign that the retail giant wants to take on the popular streaming services. Walmart might be taking on some of the biggest names in video streaming with a service of its own — and its price might be lower than Netflix or Amazon. According to The Information, Walmart is considering jumping into the streaming world. In addition to the paid subscription, which sources claim will be less than $8 per month, the company is also reportedly considering a free version of the streaming service that would include ads. It's possible Walmart could roll out this streaming service through its Vudu subsidiary, which the company purchased in 2010. Vudu lets you stream full-length movies, and is available on most set-top devices and game consoles, including Roku devices, the Apple TV, smartphones, PlayStation 4, Xbox One, and the iPad. Walmart hasn't officially commented on the matter.<doc-sep>Everyone uses some type of streaming service these days. Whether it be Netflix or Spotify, consumers rely on streaming platforms for most forms of entertainment. According to Variety, via a report by The Information, Walmart is gearing up to take on Netflix and Hulu with a new video streaming platform. The report, which uses anonymous sources, claims that Walmart is considering introducing a streaming service for $8 per month as well as a free ad-supported video service. The report also claims that Walmart is looking to target consumers in the middle of the country. "Netflix and Amazon are seen as more popular with people on the East and West Coasts of the U.S.," stated one of the anonymous sources. The $8 price point will aim to attract consumers in those middle states, as well as people who are looking for a cheaper service than Netflix. No details regarding the type of movies or shows that will be available have been released. Walmart already owns Vudu, which offers rental and streaming services for movies. Vudu currently has a free streaming service called Movies On Us which features ads. It is possible for Walmart to rebrand that service, or use their catalog from Vudu to help launch a new streaming app.<doc-sep>Netflix (NASDAQ:NFLX) is the 800-pound gorilla in the video streaming market. The company will spend somewhere around $13 billion on content this year. The cost of entry into this market is measured in the billions of dollars, and with Netflix burning mountains of cash each year, long-term profitability isn't a guarantee. Now, Walmart (NYSE:WMT), a company that has mostly kept its focus on its core retail business, may be looking to jump into the streaming market. The Information [subscription required] reported on July 17 that the megaretailer was considering launching a low-cost video streaming service that would compete with market leaders like Netflix and Amazon.com's (NASDAQ:AMZN) Prime Video. Details were scarce, but such a move would introduce even more competition in an increasingly crowded market. Walmart's plan Walmart is aiming to offer a video streaming service priced below $8 per month, according to people familiar with the situation. That would undercut Amazon Prime Video and HBO Now, and match or beat Hulu and Netflix's basic plan. The company is also reportedly considering a free ad-supported service. Service Monthly price Netflix basic (no HD, 1 screen at a time) $7.99 Netflix standard $10.99 Amazon Prime Video $8.99 Hulu with ads $7.99 HBO Now $14.99 Potential Walmart streaming service Less than $8 Walmart is reportedly interested in going after customers in Middle America. One of The Information's sources said that Netflix and Amazon are seen by the company as more popular on the coasts. That might create an opening for Walmart to offer a differentiated service aimed at demographic groups underserved by existing options. It's unclear how committed Walmart is to launching a video streaming service. One of The Information's sources said that the company may ultimately scrap the idea. This wouldn't be Walmart's first foray into video -- the company acquired video-on-demand service Vudu in 2010. But the model of selling shows and movies individually doesn't make much sense in a world full of cheap subscription services. An expensive endeavor If Walmart does go through with this plan, it would likely take billions of dollars of content spending annually to put out a product comparable with existing services. HBO spends somewhere around $2 billion annually on content, far less than Netflix, so Walmart certainly doesn't need to match the streaming giant dollar for dollar. But offering a full-scale streaming service won't be cheap. Walmart would have no problem funding content spending from its cash flow. The company generated more than $18 billion in free cash flow in the latest fiscal year. After dividend payments, about $12 billion is left over. But such a service would almost certainly knock down profits, potentially for years. The company is already sacrificing the bottom line to expand its e-commerce business, and investors may not be too keen to see another profit-sucking initiative take root. But the cost may be worth it to open up another front in the war against Amazon. Walmart has ramped up its e-commerce efforts in the past few years, with the acquisition of Jet.com, free two-day shipping, and a free online grocery pick up service. That hasn't slowed down Amazon, but it has turbocharged Walmart's online growth. Entering the video streaming market with a cheap option could help convince those who have resisted signing up for Amazon Prime to stay the course. At this point, Walmart's potential streaming service is just a rumor. But I wouldn't be all that surprised if the retailer decided to pull the trigger.<doc-sep>
Walmart is battling Amazon in online retail, groceries, and urban home delivery. It may now be opening up another front in its war: video streaming. Walmart, the world’s biggest company by revenue, is considering building its own Netflix-like service to compete directly with Amazon Prime, as well as Netflix, Hulu, AT&T’s Audience, and impending products from Disney and Apple, The Information reported (paywall). Walmart already owns Vudu, a video-on-demand platform for Hollywood movies and TV, but it’s reportedly contemplating developing its own programming and offering it for less than $8, undercutting Netflix and Amazon. Walmart is interested in pitching shows to viewers in middle America, whom Walmart believes aren’t being served by the incumbent services and their focus on coastal audiences, according to The Information. Walmart didn’t immediately respond to a request for comment. Original programming is expensive, but Walmart isn’t afraid to spend money to ensure it remains competitive with Amazon, which it regards as an existential threat. In recent years, it bought online retailer Jet.com for $3.3 billion, snatched up smaller sites like Bonobos and ModKloth, and spent $16 billion to buy Indian e-commerce site Flipkart, outbidding Amazon to gain a foothold on the subcontinent. Under CEO Doug McMillon, Walmart has aggressively tried to shake off its image as a purveyor of discount tube socks and tires and venture into new products, services, and markets. Not long ago, the idea of Walmart building a video streaming service would have seemed far-fetched. But then, so would have its partnership with Lord & Taylor.