Will Walmart’s Purchase of VIZIO Hurt Roku, Xumo? How Move Could Affect Competitors, Consumers
Will Walmart’s Purchase of VIZIO Hurt Roku, Xumo? How Move Could Affect Competitors, Consumers
Walmart could be gearing up to purchase TV manufacturer VIZIO, helping it compete with other device manufacturers by giving it proprietary data.
Walmart made headlines earlier this week when reports began to circulate that it had engaged with VIZIO in talks to purchase the TV manufacturer. Doing so would give Walmart its own line of smart TVs, but more importantly, it would gain access to proprietary shopper data owned by VIZIO that it could leverage for use in its advertising business. If Walmart were to acquire VIZIO, it could have big implications for companies like Roku and others who manufacture streaming devices as well as offer ad-supported streaming platforms.
- Walmart’s purchase of VIZIO would give it control over VIZIO interfaces, as well as the WatchFree+ streaming service.
- Roku has big presence in Walmart stores for now, but it could lose share if Walmart begins stocking its shelves with its own devices.
- Walmart’s purchasing and distribution power may lead to lower competition in the marketplace.
Analyst Richard Greenfield of Lightshed lays out the implications of Walmart purchasing VIZIO clearly. One company that may suffer from such a transaction is Roku, which recently launched a new smart TV line of its own to boost revenues, both from the devices themselves and from the greater control over ads and ad revenues that comes with being an original equipment manufacturer.
Roku already sells its streaming sticks in Walmart stores, and its operating system can be found on Walmart Onn devices, as well as smart TV models manufactured by Hisense and TCL. Would its share of space on Walmart shelves drop once that company began selling smart TVs of its own? Walmart already sells a wide range of VIZIO products, but would it launch even more to crowd out competitors?
Greenfield also points out that Comcast and Charter’s joint venture platform Xumo might also suffer from a Walmart purchase of VIZIO. Xumo’s Stream Box is intended in part to help those two companies get greater control over advertising on digital platforms, giving them a new way to sell their pay-TV plans and various streaming offerings. Walmart purchasing VIZIO would give them another competitor in regard to digital retail advertising.
How Would Walmart Buying VIZIO Affect Consumers?
The customers who would end up being affected most by Walmart’s purchase of VIZIO would-be owners of VIZIO devices. These viewers would likely see many more ads for Walmart embedded within their TV menus, and they’d see their data leveraged by the retail giant as well. Viewers who note a preference for certain products through their TV choices would likely see more targeted advertisements on VIZIO devices going forward, in an effort to get them into Walmart retail establishments to buy those products.
The move may induce some manufacturers and streaming operators to band together more closely, in order to better compete with Walmart’s huge revenues and power of distribution. Roku may attempt to purchase some smaller TV manufacturers, for example, in order to spread its operating system to as many extra devices and get as much viewer data to sell to advertisers as possible.
Overall, that could lead to less competition for consumer dollars going forward. A few enormous device manufacturers might crowd out the market with devices running on their proprietary operating systems, leaving no room for smaller companies to innovate. Each device would likely be stuffed with ads for products from the company that owned it, and perhaps more retailers would try to create their own ad divisions, as Walmart is doing with its Walmart Connect business.
This is just one possible outcome of Walmart’s purchase of VIZIO, and such a deal may not even happen. But if it does, expect competitors like Roku and Xumo to make some kind of response in order to keep pace with Walmart.
Roku Channel
The Roku Channel is a free, ad-supported streaming service that offers a broad mix of movies, TV shows, live linear channels, and original programming. Available to all viewers — not just Roku device owners — the service features licensed content from major studios alongside Roku Originals, which include exclusive series, movies, and specials previously produced for Quibi, as well as new original projects developed specifically for the platform.