The Finch Formerly Known As Gold

20 May 2005

Wally World shrinks a bit

Just in case you were starting to think that Wal-Mart was some sort of invincible juggernaut:

Wal-Mart has departed the online DVD rental business after less than two years, doing a deal with Netflix in which Wal-Mart will sent online movie renters to Netflix and Netflix will promote Wal-Mart for disc purchases.

Back when Wal-Mart launched its service, there were plenty of predictions that it would spell serious trouble for Netflix. But the retailing giant's online service never took off — back in February, Business 2.0 reported that Netflix had 2.6 million customers while Wal-Mart's service had a piddling 50,000. In retrospect, this isn't surprising: When a Web-only company has invented a business that makes sense, it's proven practically impossible to unseat it as the market leader.

(From PC World's Techlog.)

You can say, "Yeah, they couldn't be number one, so they took their ball and went home," but they weren't even close to being number two; Blockbuster has about half a million customers for its DVD rentals online.

At least Wal-Mart didn't abandon their customers, something we've seen a lot of from failed retail ventures in recent years.

Posted at 11:38 AM to Dyssynergy