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Walmart is considering its own cheap, ad-free video streaming service

FILE - This June 1, 2017, file photo, shows a Walmart sign at a store in Hialeah Gardens, Fla. Walmart says it will pay about $16 billion for a majority stake in India’s leading e-commerce company Flipkart, giving the world’s largest retailer a formidable
FILE - This June 1, 2017, file photo, shows a Walmart sign at a store in Hialeah Gardens, Fla. Walmart says it will pay about $16 billion for a majority stake in India’s leading e-commerce company Flipkart, giving the world’s largest retailer a formidable presence in a fast-growing economy. (AP Photo/Alan Diaz, File)
Alan Diaz, AP

SALT LAKE CITY — Walmart is considering launching a new subscription video service that will act as a direct competitor with Netflix, Amazon and Disney, according to The Information.

Sources familiar with the situation told The Information the service would cost below $8 per month, and the company is considering making the product ad-free.

The low cost would directly combat Netflix, which costs between $8 and $14. The streaming service Hulu offers ad-free subscriptions, though more basic plans include commercials and ads.

Currently, Walmart has a digital product in Vudu, which is an online store for downloading and renting movies, according to CNET, but the retail company does not offer a subscription service.

“In addition to Netflix and Amazon Prime Video, both of which have more than 100 million people with access to their respective subscription video offerings, Walmart would be competing with the likes of Hulu, YouTube, AT&T, Dish and Sony, all of which are trying to lure customers to their on-demand or live video subscriptions,” according to CNET. “Even Apple and Facebook are pouring money into original video to draw more people into their ecosystems.”

However, it’s unclear if Walmart would add original content to its service, Fox Business reported.

Many of the other streaming services offer their original content. Hulu, Disney, Netflix and Amazon have all invested millions into original content. Apple is projected to spend $4.2 billion on original content by the year 2022.

Ted Sarandos, a chief content officer at Netflix, in an earnings interview Monday, said original content is the future of streaming, according to Quartz.

“The way we look at this long term is that our competitors will want that content on their own services,” he said.

However, the data doesn’t always back that up. Findings from Nielsen revealed that people watch old shows, like “Friends” or “The Office,” 80 percent of the time and only watch new original content 20 percent of the time, according to MediaVillage, which first shared the data.

“What’s driving subscriptions and renewals may be the originals, but our research shows most of the viewing time is spent with catalog programming,” Steve Hasker, Nielsen chief operating officer, told MediaVillage.