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February 21, 2024by NetraMedia

Walmart Reveals Plans to Acquire Smart TV Maker VIZIO for $2.3B

Walmart, a US-based retail chain, has revealed that it will acquire VIZIO, a maker of smart TV, for $2.3 billion. The retail giant made this decision to compete with Amazon by growing its quickly expanding advertising business. Walmart has consistently been a prominent vendor of VIZIO televisions. With VIZIO’s SmartCast OS, the acquisition, according to the company, it will allow for “a profitable advertising business that is rapidly scaling.”

If the agreement is finalized, Walmart will have access to VIZIO’s SmartCast OS, which will enable the retail behemoth to provide its suppliers with streaming device ad display capabilities. Walmart will now be a major competitor in connected TV advertising, alongside Roku, Amazon, Google/YouTube, and Samsung Ads, thanks to the agreement. Closing conditions and regulatory approvals are subject to the deal. The transaction has received unanimous approval from the Vizio board of directors and the approval of shareholders who hold 89% of the voting shares in the company.

Walmart competing against Amazon

The decision was made after Amazon revealed last month that, in addition to the $14.99 monthly or $139 annual fee for Prime membership, it will begin charging its members $2.9 per month to maintain ad-free viewing of their movies and TV shows. With 18 million active accounts, VIZIO’s SmartCast system has increased 400% since 2018. According to the companies, VIZIO’s platform has over 500 direct advertisers. The majority of the company’s gross profit is currently derived from ads.

What impact will this deal have on US television?

The companies intend to merge their individual advertising businesses. Walmart currently has a $2.7 billion advertising business. Furthermore, VIZIO intends to get more access to important consumer data, such as viewership statistics. More people are anticipated to watch Walmart’s advertisements as a result of this. For instance, retailers like Walmart can monitor all advertisements that businesses that sell products there run on VIZIO TVs.

Walmart’s acquisition of Smart TV maker VIZIO and SmartCast OS

Walmart’s acquisition of VIZIO and its SmartCast Operating System (OS) would allow it to connect with and serve its customers in new ways. These include innovative television, in-home entertainment, and media experiences. Additionally, it would open up new avenues for connecting brands with consumers. It would give them unique and compelling chances to interact with consumers on a large scale and get more out of their Walmart advertising budgets. By combining VIZIO’s advertising solutions business with Walmart’s reach and capabilities, the deal is anticipated to further accelerate Walmart’s media business in the United States, known as Walmart Connect. The expansion of connected TV platforms and Walmart’s industry-leading sales of TV panels would bolster these advantages even more.

Walmart Connect

For fiscal year 2024, Walmart Connect, the retailer’s closed-loop omnichannel media business, experienced 30 percent growth. The company provides sellers and suppliers to Walmart with appealing chances to connect with their target audience wherever, whenever, and however they choose to shop. To accelerate shared growth and provide unique omnichannel solutions for advertisers of all sizes, the company never stops innovating.

In the US, VIZIO already offers free ad-supported content. Moreover, it sells mid-range TVs, the majority of which are outfitted with its SmartCast OS. Additionally, the business recently updated its lineup to include faster startup times, app switching, and an easier-to-use user interface. Conversely, Walmart prominently displays VIZIO merchandise on its shelves in its physical retail locations. Additionally, the retailer sells TV houses under the ONN brand. These are priced on the low end and sell for under $500.

What is VIZIO?

VIZIO’s goal, which was founded in 2002, has been to provide consumers with affordable, high-quality connected home appliances and immersive entertainment. VIZIO’s Smart TV operating system, SmartCast, and its expanding device ecosystem have amassed over 18 million active accounts in recent years, growing by about 400% since 2018. Through the use of advertisements, VIZIO’s customer-focused platform allows users to stream content for free on their devices. Building on this framework, VIZIO established an advertising company that has expanded steadily. Furthermore, it has allowed advertisers to reach large numbers of people. More than 500 direct advertisers, including many of the Fortune 500, are connected to VIZIO’s platform. The majority of VIZIO’s gross profit now comes from its Platform+ business. It is mostly made up of its advertising division.

Here’s what they said

Seth Dallaire, executive vice president and chief revenue officer, Walmart U.S. said,

“There is a lot to be excited about with this acquisition. We believe VIZIO’s customer-centric operating system provides great viewing experiences at attractive price points. We also believe it enables a profitable advertising business that is rapidly scaling. Our media business, Walmart Connect, is helping brands create meaningful connections with the millions of customers who shop with us each week. We believe the combination of these two businesses would be impactful as we redefine the intersection of retail and entertainment.”

William Wang, chief executive officer of VIZIO added,

“We believe this is the ideal next chapter in VIZIO’s history. By bringing our capabilities and resources together, we’ll drive innovation and create even more value for our customers. Walmart’s approach is aligned with VIZIO’s mission and vision, and our technology will help bring a scaled, connected TV advertising platform to Walmart Connect. This transaction delivers immediate and compelling value to VIZIO stockholders and is a true testament to the hard work of the entire VIZIO team.”

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