Netflix on Walmart's entry: "Anybody who is not scared by that is foolish"
According to a Wall Street Journal story (subscription required):
Walmart.com, a unit of the Bentonville, Ark., retailer, is entering the growing market pioneered three years ago by Netflix Inc. Blockbuster Inc. and Columbia House, as well as several small dot-com companies, also are exploring offering subscription DVDs on a large scale.
...So far the test has "exceeded expectations," says Jim Notarnicola, chief marketing officer for Blockbuster. But the chain, a majority-owned unit of Viacom Inc., hasn't made a final decision on whether to enter the subscription market. "If the information we have now holds up, we will be going forward," he said, noting the pricing hasn't yet been finalized.
Still, Mr. Notarnicola said Blockbuster is skeptical about the size of the online subscription market. Most movies are rented on impulse, he noted, whereas the online subscription requires planning in advance.
But Netflix already has 742,000 subscribers, a number that's twice what it had a year ago, and I'm pretty much ready to stop renting from Blockbuster!
...Columbia House, the music and video club majority owned by Blackstone Group LP, also is planning to launch a DVD subscription service in 2003, either on its own or with a partner, according to Scott Flanders, chairman and CEO. Columbia House's DVD club has about three million members.