The LA Times is reporting that Netflix is taking over Walmart's DVD rental program.
Wal-Mart is offering its existing online DVD rental customers the chance to continue their subscriptions with Los Gatos-based Netflix at their current price for the next year. Those who don't sign up with Netflix by June 17 will lose their service. Wal-Mart plans to continue promoting the Netflix service on its Web site.
In return, Netflix will remind its subscribers that they can buy DVDs from Walmart.com.
Netflix issued a press release which included the following:
In connection with today's joint promotional announcement with Walmart.com, Netflix, Inc. advised investors that it believed the agreement would not materially impact the company's current subscriber growth or financial performance and, as a result, the company is not revising the guidance it provided on April 21, 2005.
Netflix remarked that teaming with Walmart.com strengthens the Company's competitive position as the popularity of Walmart.com and the Web site's traffic offer an opportunity for increased awareness and referrals to the Netflix service.
Reports have put the total number of Walmart subscribers between 100,000 and 250,000, but the deal has significant strategic potential for Netflix.
Update: Evan sent in a screen capture with a Walmart ad on the Netflix site.
Aron sent in a shot of the Walmart site recommending Netflix.