NBCU in talks to acquire Vudu – report

Comcast's NBCUniversal is in "advanced talks" to acquire Vudu, the Walmart-owned digital video service that sells and rents movies and TV shows and also operates a free, ad-supported streaming service, The Wall Street Journal reported.

NBCU's apparent interest in Vudu enters view almost four months after The Information reported that Walmart was thinking of selling Vudu, a service that the big box retailer acquired about a decade ago for more than $100 million. The WSJ stressed that the talks might not result in a deal.

Figure 1: Vudu complements its digital TV and movie rental and purchasing service with a free, ad-based streaming service launched in fall 2016.

Walmart told the paper that it is constantly having strategic discussions, essentially repeating what the company told The Information last fall.

Why this matters
An acquisition of Vudu could assist NBCU in a couple of ways.

Vudu could provide another consumer conduit for Peacock, a streaming service that NBCU will launch later this year, and offer a mix of ad- and subscription-based tiers.

Vudu could also provide a strong complement to Fandango, a movie ticketing company that also sells and rents digital movies and TV shows through a service called FandangoNow. NBCU's Fandango got into the electronic sell-through game in early 2016 via the acquisition of M-GO, which formerly was a joint venture of Technicolor and DreamWorks Animation. According to the WSJ, Vudu's digital movie-rental business is about seven times the size of Fandango's by revenue.

And selling Vudu would also be a clear indicator that Walmart is ready to back away from a streaming and digital video market that is starting to become dominated by media giants with access to studios and broad distribution channels.

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— Jeff Baumgartner, Senior Editor, Light Reading