Net Effect: It's a download jungle out there

Wal-Mart, Amazon/TiVo are poised to duke it out -- digitally

NEW YORK -- With announcements last week that Wal-Mart will begin selling movies and TV shows online for download and that Amazon and its Unbox, through a partnership with TiVo, will be ramping up their download offerings, the e-commerce heavyweights are poised for a high-profile fight for consumers.

According to December Nielsen//NetRatings online shopping data, Amazon and Wal-Mart were second and third, respectively, in terms of unique visitors for the frame, behind eBay, which does not offer film or TV downloads. Amazon had an audience of about 51 million, while Wal-Mart finished with 36 million visitors. Although Nielsen does not place it in the online shopping category, iTunes, which also offers film and TV downloads, had 31 million visitors in December.

Working in Wal-Mart's favor is the fact that it already is the nation's top seller of DVDs, moving about 40% of all films in the format. The retail giant also has download deals with all the major distributors: the Walt Disney Co. and Pixar, Paramount, 20th Century Fox, Sony, Universal, Warner Bros. Pictures, Lionsgate and MGM. Amazon does not yet have an agreement with Disney, and Sony is holding out of the TiVo deal for now.

Amazon, which launched download service Unbox in September, has a head start in the arena. Amazon director of digital video Roy Price said consumers return to the site at a higher rate than any other store the portal has launched. Amazon also offers more content on the TV side, with deals with all the major networks and many cable channels. Wal-Mart rolled out its beta download initiative with agreements with Fox, the CW, Comedy Central, VH1, MTV, Nickelodeon and others but without deals with ABC, CBS or NBC.

Amazon's deal with TiVo also will let consumers send downloaded movies directly to their TV if they have a TiVo connection. With this feature, Amazon hopes to steal existing customers from Wal-Mart and iTunes and lure new users to the medium who might not want to watch VOD on small screens.

Nielsen//NetRatings is owned by the Nielsen Co., parent company of The Hollywood Reporter.

All chart data provided by Nielsen//NetRatings.