When Walmart (WMT) announced Monday that its digital streaming service Vudu was making a push into original content through a partnership with MGM, there were some big question marks.
None was bigger, though, than the question of what the inaugural “Walmart-MGM” original was going to be.
After days of speculation culminating at the advertising expo NewFronts West, Vudu announced its first original to come from the new partnership will be a reimagined reboot of the 1983 Michael Keaton family comedy “Mr. Mom,” set to debut in the first quarter of 2019.
Walmart is teaming up with MGM to create original content for its Vudu streaming service, beginning with a reboot of the 1983 comedy “Mr. Mom.” Credit: TechCrunchNow the big question is whether or not Walmart will be be able to boost the performance of a streaming service that it purchased eight years ago. Indeed, Vudu has lagged behind the performance of its peers.
Among U.S. households that streamed video on a television at home in April, only 13% used Vudu compared to 73% watching Netflix (NFLX), 50% YouTube, 36% Hulu, and 28% Amazon (AMZN), according to comScore data originally reported by the Wall Street Journal.
Walmart’s hope that the content from the MGM partnership, which will live on Vudu’s free, ad-supported Movies on Us section, will ultimately drive users to shop by clicking on “shoppable ads.” Vudu will soon offer shoppable ads that consumers can click on to receive more information on an item they’re interested in buying via email. Consumers will eventually be able to add items directly to their Walmart.com shopping cart while watching a show, Walmart said in press release announcing the MGM deal.
But in order for that strategy to bear fruit, MGM’s exclusive content will need to do what Vudu’s existing library of over 150,000 titles for rent or to buy has failed to accomplish — attract users. And not everyone is convinced that will happen.
“The fact that Walmart is going to spend a little bit of money to support its streaming service is not surprising,” said Dan Rayburn, principal analyst at Frost & Sullivan. “But they’re not going to compete with [Netflix.] Those guys are spending billions of dollars.”
As of July, Netflix said it will spend $8 billion a year on original and acquired content. Meanwhile, Amazon’s Prime Video’s programming budget was over $4 billion. Vudu claims it has a different strategy.
“We are not going to be a studio. We are not going to have 300 or 400 originals,” Scott Blanksteen, Vudu’s vice president of product and ad-supported VOD, recently told Variety.
But the mere fact that they have taken a step in that direction signals a serious shift in thinking, and could help Vudu finally differentiate itself in a sea of streaming providers, according to CFRA Research analyst Tuna Amobi.
“The playbook we’ve seen work has been one of creating compelling original shows to essentially complement the licensed shows,” Amobi told Yahoo Finance. “In some respects I think Vudu now is going to be riding on the work that these players have already shown: that the formula can be successful, and that it can help differentiate the brand.”
Zack Guzman is a reporter for Yahoo Finance. Follow him on Twitter @zGuz.
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