LOS ANGELES –
Digital Entertainment Group
(DEG) reports 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 due to double-digit Blu-ray Disc growth and an
uptick in digital distribution.
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
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
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 sellthrough
— climbed 77 percent to
$2.4 billion, compared with $1.3
billion last year.
Electronic sell-through increased
nearly 22 percent to $329 million,
compared with $270 million last
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
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 Ultra-
Violet 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