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DEG: Internet-Delivered Content Rose In Q1

Los Angeles — Consumer spending on electronic sell-through (EST) of video entertainment rose 43 percent over the first quarter of 2014, following a 51 percent increase tracked in the same period a year ago, according to new research released by the Digital Entertainment Group (DEG).

The multi-industry home entertainment promotions group said the findings underscored trends the industry saw throughout 2013, and indicates that consumers are shifting buying and viewing behavior in favor of entertainment content streaming and downloads.

Further, the DEG said electronic sales of digital home entertainment content should approach video-on-demand revenue levels for the first time later this year.

Overall consumer spending was down 3 percent in the first quarter, due in part to the Easter holiday weekend falling in the second quarter in 2014, making for uneven comparisons to first quarter 2013. The decline was in line with cumulative box office results for films released in the home entertainment window during the quarter.

Easter weekend is the second busiest shopping period of the year outside of the year-end gift buying season, providing a sales boost of 25 percent on average.

In other findings, the 43 percent rise in EST in the first quarter came despite a decline in the box office for titles released for home entertainment, reflecting the broader availability of titles and increased access to digital content.

Sales of theatrical new releases to home entertainment jumped 83 percent in the first quarter compared with the same period last year.

The DEG said the number of Blu-ray homes continues to climb, with 4.2 million players sold in the first quarter (including Blu-ray Disc set-tops, PlayStation 3/4s, Xbox Ones and HTiBs).

This is an increase of 38 percent over first quarter 2013. Total household penetration of all Blu-ray-compatible devices now stands at close to 75 million U.S. homes.

Approximately 7.8 million HDTVs were sold to U.S. consumers in the first quarter. HDTV penetration to date now stands at 99 million U.S. households. Nielsen estimates the number of U.S. TV households is 115 million.