The Continuing Walmart Black Eye

It's no secret here that I despise WalMart, in any of its incarnations. Two items in the news today regarding this distressing visage that brings home the socio-economic mantra that "we are the society we create".

First item is from Apple. I like Apple. A lot. If you remember, I touted the announcement of the iTV set-top box as the "next" thing, or the Missing Link, or whatever. It is all of those. During Jobs' press conference/circus act, he also introduced the availability of Disney movies through the iTunes music store. Now we find out that there were supposed to be more studios on board at roll-out time.

Now the real story:

Walmart accounts for 40% of all hard copy DVD sales. That's A LOT. It's enough that movie studios don't want to piss off the monster named Wally. They don't even want to poke it with a sharp stick. Walmart demands that they be able to buy the DVDs at $17.00 per unit. When Walmart heard that Apple was going to sign studios to a deal where you could download a new-release movie for $14.95, they pooped down both legs.

This was an egregious affront to the deal that Walmart had with the studios, to buy DVDs at $17.00 a pop. Walmart saw its sales numbers going down and made a few phone calls to studios, telling them that if they were going to give Apple movies for $14.95, then Walmart was hereby demanding that they get to buy the DVDs at the same price, or face the simple fact that Walmart was going to cancel any and all purchase contracts from the studio for DVDs. Of course, this put the fear of God in the studios, because Walmart sells 40% of all DVD copies.

Studio orders go down by 40% in one swell foop.

So the studios make a little call to Steve over at Apple and tell them that they can't come out and play tomorrow after all, and well, we'll have to see if we are going to get on board with the iTunes music store thing.

Steve scratches head. Invitations are already out, the little finger sandwiches are already in the fridge. Somebody tells him that Walmart pissed on the party and he makes a little call over there... Walmart CLAIMS it wasn't really trying to manipulate the whole world economy, but steve sees right through that one. You see, DVDs only represent 2% of Walmart's revenues. They don't care whose party they spoil. The studios need them MUCH more than Walmart needs the studios. That's the way they like it.

Anyway, word has it that Apple and Walmart are in negotiations, and one possible deal that is rumored is one in which Walmart would get a share of iTunes download revenues in exchange for its willingness to sell iTunes digital download coupons.

Can you FREAKING believe that??!!! The corporate arrogance at Walmart is simply astonishing.

So, on to the other story: Today's copy of the New York Times ran an interesting story, one with which we are now familiar, about the way Walmart eats its own offspring like cocktail weenies. One employee strategy to combat this was to look at employee unionization. No problem, Walmart said, AND PROMPTLY CLOSED THE STORE IN QUESTION. No store, no union. Easy as that.

Walmart is famous for trimming, squeezing, and slashing supplier costs relentlessly. While the company would like the world to focus on the benefits derived from its low prices, it's hard to ignore how the nation’s largest private employer often grinds up its hourly workers in the same machine.

There are distressing signs that Walmart may be acting on many of the ideas outlined in an internal document — leaked last year — to rid its payroll of full-time and less-healthy employees who are more expensive for the company to retain. For instance, Steven Greenhouse and Michael Barbaro reported yesterday in The Times that employees at several Florida stores say that managers are barring older employees with back and leg problems from using stools they had sat on for years.

Other employees are complaining of sudden scheduling changes they say are skewed to chase out long-term employees, and wage caps that act as a disincentive for those longer-tenured workers. In a stunning deployment of corporate doublespeak, a memo to store managers describes the wage caps as a way to maintain “internally equitable pay levels.” It is true that if everyone is making the same everyday low wages, a perverse form of equality is established among them.

Walmart is a scourge on the face of this country's economy, and a pock mark on our nation on the international stage.

Poo award for this week.