The idea of an Internet-ready home entertainment setup has a powerful new backer: Wal-Mart. The retailer is buying Vudu, a Silicon Valley start-up whose 3-year-old online movie service is being built into a number of TVs and Blu-ray players. The two companies began informing Hollywood studios and television manufacturers of the deal on Monday; Wal-Mart expects to close within a few weeks.
The move could impact the TV business, analysts say. Consumers will have added reasons to watch entertainment from sources other than their cable or satellite company, potentially motivating more to cancel subscriptions and buy Internet-ready televisions and disc players. Movie stores like Vudu's also compete directly with the video-on-demand services of the cable companies.