YNOT – After announcing its acquisition of web-to-TV movie provider VUDU on Monday, Bentonville, Ark.-based retail giant Wal-Mart announced it would shutter the service’s adult entertainment channel.“After Dark,” which for the past two years has offered porn on demand in cooperation with AVN Media Network, will cease broadcasting “over the coming days,” according to a message VUDU sent to adult studios on Wednesday.
“As you may have recently heard, VUDU was acquired by Wal-Mart,” the emailed notice read. “In conjunction with this acquisition we will be discontinuing the ‘After Dark’ adult service over the coming days. Upon completion of the shutdown process, we will settle all accounts with you and ensure that you are paid the full amount you are owed under our existing agreement.”
VUDU also requested adult studios sign voluntary termination agreements, as their materials no longer would see air time and thus would generate no further revenues.
“We’ve enjoyed working with VUDU over the past two years in the development of an online service that offers the highest-quality entertainment available to fans of adult content,” AVN Chief Executive Officer Darren Roberts said Wednesday. “We’re currently looking at other platforms that are suitable to carry out this vision.”
Customers who purchased movies from VUDU’s After Dark service will receive automatic refunds, as once the service goes dark, the movies no longer will be available. Rental customers will not be affected. No calls to VUDU or Wal-Mart are necessary to claim the refunds, a VUDU spokesperson told AVN.com.
Although specific terms of the VUDU deal have not been released, published reports have speculated at a price tag higher than $100 million. That’s not too shabby a payday for a start-up Wal-Mart described in its Monday announcement as “a revolutionary service, built into a growing number of broadband-ready TVs and Blu-ray players, that delivers instant access to thousands of movies and TV shows directly through the television. Customers with broadband internet access and an internet-ready TV or Blu-ray player can rent or purchase movies, typically in high-definition, without needing a connected computer or cable/satellite service.”
The move is seen by many as a make-or-break tactic for Wal-Mart, which tried digital distribution in 2007 only to abandon the effort a year later due to a platform shift. According to The New York Times, “Wal-Mart…is one of the world’s largest retailers of DVDs. But it has so far lacked a way to deliver movies digitally to people’s homes—a glaring weakness as consumers shift from renting and buying physical discs to streaming movies over the internet.”
This time Wal-Mart hopes to get the distribution platform right.
“VUDU’s services and apps platform will give Wal-Mart a powerful new vehicle to offer customers the content they want,” VUDU Executive Vice President Edward Lichty said in a prepared statement.
In its own statement, Wal-Mart added, “The real winner here is the customer.”
