Wal-Mart and Apple Battle For DVD Turf

Business Week reports:

The guy from Bentonville, Ark., surely isn't on any of Hollywood's leading man lists. A 23-year Wal-Mart Stores (WMT) veteran, David Porter is the person at the retail giant who orders DVDs and slashes prices to move them. But this summer, Porter has been one of Hollywood's hottest acts, taking meetings with top studio brass like a producer with a hot script. His pitch: Wal-Mart isn't happy.


That prospect tends to send shivers through Hollywood's Gucci-toed corner offices. As the largest seller of DVDs, Wal-Mart accounts for roughly 40% of the $17 billion in DVDs that will be sold this year, a financial lifeline to big-spending studios. But now Wal-Mart's video business faces a potential threat by Steve Jobs and Apple Computer (AAPL), which in mid-September, sources tell BusinessWeek, plans to announce it will start offering movie downloads from its iTunes store.

The notion of kids running around with full-length movies on new, wider-screen iPods that Apple is expected to unveil as well is causing grief in Bentonville, according to Hollywood executives. The $312 billion a year retailer, they say, wants concessions that could include lower DVD wholesale prices.

The on demand world of movies is heating up.