Starting today, Wal-Mart Stores Inc. begins selling films over the Internet, as the leading seller of DVDs stakes a claim in the emerging market of movie downloading.

The online store, found at www.walmart.com/videodownloads, is the first to offer digital movie purchases from all seven major Hollywood studios.

The online DVD market is already crowded with competitors, including Apple, online retailer Amazon.com's Unbox, premium cable operator Starz Entertainment Media Group's Vongo and lesser-known download-to-own services such as Movielink and CinemaNow Inc. These services are still struggling to find a mainstream audience.

Wal-Mart's announcement was not surprising, given the retailer's role in DVD sales, the single largest source of studio revenue.

As the nation's top seller of movies and music, with about 40 percent of the DVD business, Wal-Mart has the leverage to extract concessions from the studios on both products and pricing.

Wal-Mart's online movie store emulates the no-frills atmosphere pricing of its stores. It undercuts rivals on price, selling downloads of new movie releases from $12.88 to $19.88 and older titles for $7.50. Downloads of TV shows sell for $1.96 an episode.

The retailer will offer DVD buyers a coupon for a discounted digital copy of the same movie for $1.97. However, it will not yet permit customers who download a movie through its online service to make a DVD copy at home, saying the technology is too time-consuming and "onerous."

"They have probably the broadest relationship with the Hollywood consumer because of their vast retail infrastructure," said Thomas Lesinski, president of Paramount Pictures Digital Entertainment." As a result, this is going to extend that relationship."

Wal-Mart, the world's largest retailer with annual revenue of $316 billion, has been slow to develop a download business.

Its music site, which began a test phase at the end of 2003, made news by undercutting Apple Inc.'s iTunes on price and selling songs for 88 cents. But since songs downloaded from www.Wal-Mart.com wouldn't play on Apple's iPod, the dominant portable music player, the company's music offering failed to garner much interest.

When the Bentonville, Ark.-based company last November announced its intentions to offer movie downloads, some analysts were lukewarm, saying that the endeavor didn't fall within Wal-Mart's area of expertise.

"This is a simple issue of following what our customers want from us," said Kevin Swint, Wal-Mart's divisional merchandise manager for digital media. "As our customers increasingly want content by download, that's what we're trying to support."