Blu-ray, Streaming Media See 1st-Half Bump


Los Angeles - Home entertainment media sales got a shot in the arm over the first half of the year from the double-digit growth of Blu-ray Disc sales and a steady uptick in the use of digital distribution, according to a recent report issued the

Digital Entertainment Group (DEG)


The home entertainment industry promotions group said consumer spending on home entertainment rose some 1.4 percent during the first six months of the year, to more than $8.4 billion, compared with $8.3 billion for the same period a year ago. Those numbers also reflected subscription video-on-demand (VOD) spending.

Prerecorded Blu-ray Disc sales saw steady double-digital growth rates, as consumer spending on discs rose 13.3 percent compared with the same period last year. Of this, catalog titles increased 26 percent.

As for BD player penetration, the DEG said Blu-ray homes rose by 1.4 million Blu-ray players (including BD players, PlayStation3 consoles and HTiBs) in the second quarter, to reach more than 42.1 million Blu-ray Disc-compatible devices in U.S. homes at the end of the first half.

Looking to future high-def media sales, the DEG reported that 4.6 million HDTVs were sold in the United States in the second quarter 2012, boosting total HDTV penetration to nearly 80 million U.S. households to date.

Despite the success of Blu-ray Disc sales, total physical media sell-through dropped 3.6 percent in the half with DVDs included. The older standard definition disc format dragged total physical media revenue down to $3.7 billion from $3.8 billion the year before.

Including electronic distribution, total sell-through declined nearly 2 percent to $4 billion from $4.1 billion, the DEG said.

Digital distribution -- transactional VOD, subscription VOD services such as Netflix, and electronic sell-through -- climbed 77 percent to $2.4 billion, compared with $1.3 billion last year.

Electronics sell-through increased nearly 22 percent to $329 million, compared with $270 million last year.

The segment grew 27 percent in the second quarter vs. the same period in 2011. Transactional VOD was up 11.6 percent to $983 million, compared with $881 million in the midyear of 2011, including a 17.2 percent increase in the second quarter compared with second quarter last year.

Meanwhile, subscription VOD sales passed the $1.1 billion mark, up 430 percent from last year's $208 million.

Rental revenue continued to decline in all sectors but kiosks, with total revenue -- including VOD -- dropping 17.6 percent to $3.2 billion, from $3.9 billion in 2011.

Kiosk rentals, on the other hand, said revenue grow to $990 million, up 23 percent from $805 million last year.

Brick-and-mortal video store revenue fell 33 percent to $597 million from $896 million, and by-mail disc rentals plummeted 50 percent to $671 million, from more than $1.3 billion last year.

Penetration of media viewing through the new Cloud-based digital locker system known as UltraViolet passed the 4 million household account level in the period, which the DEG attributed in part to the growth of available titles and consumer familiarity with electronic sell-through.


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