Report Reveals Fall in DVD Market

LONDON: A decrease in DVD purchases and rentals resulted in a $2.6 billion—or 4.8 percent—fall in the global video business in 2008, according to a new report from Screen Digest.

Acknowledging the slump in the U.S. market, the report also points to a softening home-entertainment market in other territories; outside of the U.S., consumers spent $26.4 billion on video software last year, a 3.6-percent drop on 2007. Of that, $18.1 billion went to purchasing DVDs, 4.7-percent down on the year-ago period. The Blu-ray format—which recorded revenues of $484 million in 2008—has not helped much to stop the downward slide, Screen Digest reports, noting that the battle with the HD DVD format slowed initial take-up of next-generation DVDs. Other methods of accessing content, notably downloads—pirated and legal—have also had an impact on overall DVD revenues.

While the report points to a reduction in consumer spending on DVDs in numerous key markets, it does reveal increases in China, India and Russia. At present these three account for just 4 percent of the international market, but this figure is expected to grow.

Releasing the report, Helen Davis Jayalath, senior analyst at Screen Digest, commented: "We expect Blu-ray to account for 6.9 percent of international video spending this year—assuming there is strong promotional activity. However, despite consumers’ interest in the high definition format and demand for packaged media, the current challenging economic climate means that we don’t expect BD to be driving even minimal sector growth until 2010."