Is Target’s Web Video Entry in Trouble?

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Target (NYSE:TGT) is gearing up to break into the lucrative, fast-growing digital-video market, but that big break could be complicated by a number of new challenges that the second-biggest U.S. retailer now faces upon learning that its core system just recently switched owners.

According to Variety, Target Ticket, expected to launch October 1, is the retail giant’s latest offering which will give consumers access to a collection of about 30,000 TV and movie titles for rental or purchase. Though many of its rivals like Wal-Mart (NYSE:WMT) and Best Buy (NYSE:BBY) have already beaten it to the punch, Target is hoping it can lure in new customers who have never downloaded or streamed video entertainment and also steal other seasoned consumers with its program’s new promises that, according to Variety, include access to day-after-broadcast TV episodes and movies before they’re available on DVD.

The retailer is also aiming to make its site more family-friendly by working with Common Sense Media to offer parental control with movie and TV-show ratings, but even still, those efforts could end up falling short. That’s because there’s a slight glitch in Target’s new plan — its core system, entertainment firm Rovi, just sold its video e-commerce entity Rovi Entertainment Store to Reliance Majestic Holdings as of September 1. Now, Target unexpectedly has a new partner to work with, which may be okay except Rovi Entertainment is continuing to lose money, and Reliance Majestic Holdings, a Beverly Hills startup, has yet to confirm how it plans to stem these significant losses.

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