Why Walmart Is Becoming a Streaming Power Player

As the annual retail bonanza of Black Friday approaches, Walmart is out on the front lines as usual, hyping deals not only for physical products but for its membership program Walmart+ as well, slashing the cost of an annual plan by 50%.

The point of doing so is obvious: Lure holiday shoppers into paying for a full year up front, in hopes that they find Walmart+ appealing enough to pay full price next year.

But there may be an additional, less obvious motive at play behind the steep discount, highlighting how Walmart has been quietly building itself into a would-be — or rather, will-be — streaming power player, perhaps the only one that can rival Amazon as the all-in-one dealer of the streaming market.

A Walmart+ subscription, of course, also includes an ad-supported Paramount+ subscription, one of several ways in which the membership program is designed to compete directly with Amazon’s Prime service. With more Walmart+ members come more streaming subscriptions, bringing in both ad revenue and a wealth of consumer data, traded between Walmart and Paramount for mutual benefit.

Still, the opportunity in offering just one streaming subscription is naturally limited. Amazon, after all, sells several of the major SVODs (along with a great many smaller services) through its Channels marketplace, allowing the tech giant to reap a share of incremental subscription revenues from plans purchased through its platform.

Data also indicates Amazon and the big-box retailer are at least somewhat complementary in the eyes of consumers: Among all demographics in a June survey by PYMNTS Intelligence, far more consumers subscribed to both Walmart+ and Prime than to just Walmart+.

To truly compete with Amazon, then, Walmart needs a more robust streaming offering — and just such an offering is already in motion.

Somewhat lost in the chaotic shuffle of 2024 was the news, announced in February, that Walmart will acquire electronics company Vizio, one of the top manufacturers of smart TVs in the U.S. While the Federal Trade Commission is conducting an antitrust probe of the acquisition, Walmart likely has nothing to fear from such an investigation with a new Trump administration now headed to the White House.

By acquiring Vizio, Walmart will essentially become a streaming aggregator in one fell swoop, gaining control of the company’s smart TV OS, SmartCast, as well as its “Vizio Account” subscription aggregation platform. As with Roku and other OSes, consumers can purchase and manage SVOD subscriptions through Vizio’s platform in the name of convenience (and a cut of sub revenues for Vizio).

Granted, Vizio is hardly a power player in either of these areas. Its OS has been roundly criticized by consumers in the past, while its share of the SVOD subscription market does not appear to be significant compared with longtime aggregators Apple, Amazon and Roku, given the lack of available data. (Vizio Account only launched in August 2022, with the post-COVID streaming correction already in full swing.)

These platforms nevertheless give Walmart ample opportunity to expand its business in a few streaming-centric directions. Most significant is the opportunity for Walmart’s advertising business, so much so it was specifically called out in the official press release announcing the transaction: “The combination would be expected to further accelerate Walmart’s media business in the U.S., Walmart Connect, bringing together Vizio's advertising solutions business with Walmart’s reach and capabilities.”

In other words, Walmart will be able to push Vizio smart TVs, already one of the lower-cost options on the market, to consumers by positioning them as loss leaders and making up the difference through ad revenues and leveraging consumer data — just like any other hardware/software company — not to mention pushing Walmart+ membership to consumers who buy TVs via the chain.

Of course, an additional advantage for lies in the fact that if a consumer would rather use a streaming media player or a TV from another manufacturer, Walmart can turn right around and sell it to them — possibly at an attractive holiday season discount.

Walmart is therefore well on the way to going toe-to-toe with Amazon as the “everything store” of streaming, with its own hardware, connected TV OS, subscription marketplace and, if not its own proprietary SVOD, at least a high-profile partnership to offer one. Though e-commerce has steadily eaten away at the traditional retail business, Walmart is one giant that can’t be slayed so easily.