Disney, Walmart lay some ‘Toy Story’ Vudu on UltraViolet

Starting today, anyone who buys Disney Pixar’s “Toy Story 3” special edition 3-disc set at Walmart will automatically get access to a digital copy of the movie via Vudu, the Walmart-owned streaming service, at no extra charge. With Vudu’s announcement last week that its streaming app will now be available on PCs and Macs via Boxee’s free media center, Walmart customers will be able to watch “Toy Story 3” from anywhere with a broadband connection.

If the scheme sounds familiar to supporters of UltraViolet, the industry consortium formerly known as DECE, it’s because the Disney-Walmart “Toy Story” offer is strikingly similar to one of the hypothetical use cases UltraViolet president and Sony Pictures exec Mitch Singer likes to serve up to illustrate the promise of UltraViolet’s buy-once-play-anywhere vision: buy a Blu-ray Disc at Best Buy, get a rights token in your cloud-based UltraViolet “locker” conferring permission to stream the movie to any UltraViolet-compliant device you’ve registered to your UltraViolet “domain.”

The critical difference is that neither Disney nor Walmart is a member of UltraViolet. And based on today’s announcement, they clearly see no reason to be.

As I noted in a column for GigaOM Pro ($$) back in March, Walmart’s $100 million acquisition of Vudu earlier this year was about more than simply adding a VOD service to offset declining physical media sales. It was also about gaining access to certain proprietary technologies developed by Vudu that could become the foundation for a broader Walmart-centric digital content ecosystem.

One of the those technologies was the HDX encoding format used by Vudu for delivering video. With HDX, Vudu  can deliver full 1080p video with 5.1 channel sound over the Internet in 4.5 Mbs of bandwidth. The format is optimized for screen sizes over 40 inches and includes a process Vudu calls TruFilm, which enhances the cinematic experience of a home theater through techniques like preserving film grain and other textual qualities of the original source material.

That gives Vudu a distinct quality advantage over other embedded streaming platforms like Netflix, DivX and CinemaNow– all members of UltraViolet. More importantly, it also sets Vudu apart from UltraViolet’s “common file format.

Another critical piece of Vudu technology is its cloud-based apps architecture. Just before it was acquired by Walmart, Vudu stopped selling its standalone set-top box and began offering its software as an embeddable platform to CE companies. In addition to the original Vudu VOD service, the platform included support of third-party apps. In short order (and no doubt in anticipation of the imminent Walmart acquisition), Vudu lined up deals with LG, Samsung, Mitsubishi, Sanyo, Sharp, Toshiba and Vizio to embed its software in their connected TVs and Blu-ray players and compiled a roster of over 100 apps.

Unlike other TV apps platforms, such as Roku or the new Apple TV, Vudu’s system is cloud-based, allowing content and  functionality to be updated without the need to distribute updated app software to end users. That architecture apparently is also now handy for supporting cloud-based movie streaming through a proprietary app and tied to the purchase of a physical disc.

It’s also exactly the sort of architecture envisioned for UltraViolet, only proprietary and without the complexity of registering devices to a domain or managing a universal, interoperable rights locker.

The fact that the first movie in the Disney-Walmart streaming alliance comes from Pixar points to an even bigger challenge facing UltraViolet. Pixar, of course, was founded by Apple impresario Steve Jobs, who then sold the animation studio to Disney, becoming Disney’s largest individual shareholder in the process. And like Disney and Walmart, Apple is also not a member of UltraViolet.

Officially, Apple has no involvement in the Disney-Walmart deal on “Toy Story.” But Vudu does have an iPhone app, which means that, theoretically at least, iPhone users who purchase the “Toy Story 3” Blu-ray at Walmart should be able to view it on their Apple device (although the press release does not mention the iPhone connection).

What we may be seeing, then, is an emerging Disney-Walmart-Apple axis set to challenge the UltraViolet alliance in battle to make buy-once-play-anywhere a reality. And the Axis has struck first.