Today AOL announced that they will release the horror film 'Incubus' as a "direct-to-download" exclusive on AOL RED, a teen-centric entertainment site.

Starring Tara Reid, the feature-length film follows a group of six teens attempting to escape from a government paranormal research lab. AOL plans to sell downloads for 7.99 or five day rentals for $3.49. Purchasers can begin watching the stream as it downloads. The film will be available for download beginning on October 31st, and AOL will have a 30 day exclusive window before the DVD hits stores. AOL plans to promote the release with a user-generated content contest where fans can submit homemade horror shorts. No specifics on prizing was mentioned.

At first glance, this looks like a creative way to build buzz for both AOL RED (who heard of it before today, anyway?) and the DVD's release. However, given the fact that the target audience spends more time online than watching television, this little promotion may have stumbled on a new window. If they're successful, that is…

According to recent reports on CNNMoney.com, Wal-Mart is ramping up its movie download service efforts amidst the recent launch of Amazon and Apple’s services.

The single largest seller of DVDs in the world, Wal-Mart accounts for upwards of 40 percent of all DVD sales, mainly from highly popular new releases from the studios. The article speculates that the move is part of Wal-Mart’s effort to maintain this dominance.