Looks like the digital download revolution has suffered a potential setback this week as retail giant Wal-Mart announced a retreat from the battlefield and decided to permanently shut down their movie download service, which had been operational for less than a year. A message on the website explains that the online store closed as of Dec. 21st, but that customers who had already purchased movies would be able to continue to watching them indefinitely. A Wal-Mart spokesperson said that the closure was a direct result of Hewlett-Packard’s own discontinuation of their video download software service.

So does this mean that the shut down is only temporary as Wal-Mart looks for a new technology provider to partner with? Or does it mean that they just weren’t making any money on movie downloads? The answer remains unclear, although Apple, Amazon, Microsoft and Netflix are all still very much in business.

Perhaps it is also worth mentioning that Wal-Mart’s movie downloads ranged in price from $12.88 to $19.88. Comparatively speaking, iTunes movies seem to run in the $12.99 to $14.99 range, but I think the closer you get to $20, the more people think they’d rather just buy the DVD instead. Do you think this announcement reflects a lack of public interest in online movie downloads? Or is it just a minor speed bump along the road to our ultimate digital destiny?