Vudu casts boxes onto Best Buy shelves

By Susanne Ault -- Video Business, 5/22/2008

MAY 22 | Vudu has scored shelf space at two dozen Best Buy California outlets, marking the fledgling product’s first distribution in bricks-and-mortar stores.

Since its fall 2007 launch, the device that beams films directly to TV sets without the use of a computer has been limited to such online retailers as its own Vudu.com Web site and Amazon.com. But starting in March, Vudu boxes were being offered at 24 Best Buy outlets. Vudu’s site lists the exact Best Buy outlets offering the product in-store.

The goal is to raise mainstream interest for Vudu, say sources, which is currently at a disadvantage to bigger-branded rival Apple TV.

Both similarly utilize broadband connections so consumers can order and view films via their TV displays. Vudu and Apple both offer major studio releases for download day-and-date with the titles’ DVD release. The two also offer movies for streaming rental about 30 days after they street on DVD. Presently, the entry-level Vudu can be had for $295 and holds up to 50 permanently downloaded feature-length films. The base Apple TV model is tagged at $229 and holds 50 hours of video, representing roughly 25 films.

At some of the Best Buy locations, the two products appear to be merchandised distinctly from one another. Vudu boxes are being merchandised in four different locations: within Best Buy’s TV sections, in its high-end Magnolia theater rooms, in DVR/new technology displays and near DVD racks. In contrast, Apple TV can be generally found once, near Apple media products.

Neither Vudu nor Apple have provided sales results for their respective devices.

Vudu management declined to discuss the strategy behind its Best Buy testing. A chain spokesman did not comment by press time.

However, Patrick Cosson, VP of marketing at Vudu, acknowledged that Vudu has been gaining traction with consumers and studios in recent months. Since its bow last year, Vudu has added 500 new movies, for a current total of 5,500 titles available. Also during that time, Vudu added 1,000 TV episodes and 150 high-definition films.

“Brand awareness is growing very quickly, as our Web site traffic is growing very quickly,” said Cosson. “And it’s growing all across the country—in all kinds of markets.”

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