Physical Delivery Still Trumps Online Video Delivery

The U.S. home video entertainment market, consisting of the rental and sale of movies and television shows either on physical media or using networks, amounted to $18.5 billion in 2010, Screen Digest’s preliminary forecast indicates. Network-delivered rentals and sales via the Internet and subscription TV systems accounted for $2.3 billion of this revenue, representing 12.2 percent of the total market.

Growth in network sales and rentals was dwarfed by the growth in the sales and rentals of Blue-ray titles. Revenue from all types of network delivery rose by 21.9 percent for the year, while Blue-ray retail sales soared 64.2 percent and rentals boomed by 105.5 percent.

“With consumers continuing to be very cautious in their spending habits, the popularity of the rental model reasserted itself in 2010,” said Tom Adams, principal analyst and director, U.S. Media, for Screen Digest. “This consumer mindset sent Blu-ray rentals soaring and could be seen on the Internet too, where video-on-demand (VOD) rentals jumped 55.7 percent. In contrast electronic sell-through (EST) on networks grew by just 27 percent."

Network Delivery of Video Fails to Live Up to Hype in 2010