For 15 years, Walmart has effectively ceded the internet to Amazon, allowing Amazon to develop a well-deserved reputation for low prices and quick delivery, as well as incredible power over manufacturers on pricing, terms and cash flow. Walmart has over 20x the sales of Amazon ($405B vs. $19B) but their market cap is now not even 4x as large ($207B vs. $56B). With that $400B of pricing power, Walmart had a clear advantage but didn't play their cards right.
The best move would have been to compete better from day one with a better website and lower prices. The second best move would have been to swallow Amazon whole 10 years ago, 5 years ago or last winter when their market cap sank below $15B. The third best move - and the only one remaining - is to take on Amazon in a price war, steal their customers and suppress their revenue and earnings growth. After 15 years of oblivion and non-competition, Walmart just woke-up to the obvious fact that they could dominate Amazon in a price war if only they tried. Books, DVDs and Video Games have all been slashed to levels that will shock online shoppers into realizing that if anyone is going to be the Walmart of the internet, it will be Walmart.com.