Wal-Mart Tests Movie Downloads As Its Web Site Struggles To Keep Up

After a series of online promotions helped knock out Wal-Mart's Internet site at the start of the holiday shopping season, the giant retailer began testing a video service Tuesday that promises to test the stability of the Web site again.

The video service trial requires the purchase of a "Superman Returns" DVD bundle that includes the physical DVD as well as instructions for downloading the same movie to PCs and PDAs. The online version can be played after a copy of the Wal-Mart Video Download Manager is installed on the playing device.

At the same time, Wal-Mart is continuing a series of online promotions that are attracting hordes to its 2-million-page Web site. The promotions range from a $49 3-megapixel Philips digital camera to a 44-inch Hitachi Plasma HDTV for $1,198.

"I'm afraid it was too much of a good thing on Friday," says Wal-Mart spokesman Ravi Jariwala in describing the flood of online customers who flocked to the company's site on Black Friday in search of holiday deals and promotions. He adds that the firm had been expecting a doubling of order activity over the previous year's Black Friday activity. Instead, orders were coming in at seven times the volume of the previous year.

Internet traffic monitor Keynote Systems said Wal-Mart's online outages totaled about 10 hours on Black Friday. Jariwala, who wouldn't confirm that number, says the company extended the Friday promotions in an effort to give customers unable to access the site an opportunity to place orders.

Wal-Mart launched its "new and improved" Web site Oct. 24. Jariwala says large numbers of Web servers and computers were added to the site's infrastructure. "We have hundreds of servers supporting our site and have the ability to add more as needed," he says. Several software services and products are used in the site, including HTML, DHTML, Flash via OpenLazlo, and different versions of JavaScript.

After the site returned to normal, traffic was still coming more than 60% above last year's levels, and the site has been functioning well, Jariwala says. Other online retail sites were also up, but few showed gains as dramatic as Wal-Mart's. Akamai Technologies' Web traffic service reported overall traffic gains of 17% for shopping sites Tuesday.

Some aspects of how customers use the Wal-Mart site still aren't clear, says Jariwala. For instance, the company knows that many customers research products online and then buy in Wal-Mart retail stores. But the company hasn't been able to generate any reliable percentages for the "cross channel behavior."

"We know some things," he says. "The Consumer Electronics Association says that 77% of purchases of all consumer electronics are influenced by research on the Internet." Jariwala adds that 138 million customers visit Wal-Mart stores weekly, and 75% of them have Internet access; of that number, 74% shop online.

But why are the online shopping gains so dramatic? Jariwala attributes most of it simply to the rapid spread of broadband access.

As for the video service, Wal-Mart was somewhat slow off the mark after Apple Computer entered the movie download field in September and promised to introduce at a later date an iTV player capable of playing movies on TV sets.

Wal-Mart, which sells some 40% of all movie DVDs in the United States, is replying indirectly with this week's introduction in an effort to protect its market share. A Wal-Mart spokeswoman says the video service trial is underway in several states.