Disc sales, rentals have generated $8.3 billion so far in 2011
As the home entertainment balance tips toward more people now renting movies than buying them, rentals through subscription streaming services such as Netflix are showing the fastest growth.During the first half of 2011, home entertainment rentals racked up nearly $4.2 billion, while physical disc and electronic disc purchases generated $4.1 billion, according to the Digital Entertainment Group. The rental figure includes coin collected from traditional retail outlets, kiosks like Redbox, subscription-based streams from services like Netflix and VOD offerings from cablers. Overall spending on home entertainment in the U.S. was off 5% for the first half of 2011, at $8.3 billion, after last year’s success of Fox’s homevideo launch of “Avatar” propped up much of the biz. This shift in consumer behavior started taking place during the recession, but isn’t showing any signs of ending anytime soon, with the rental market growing nearly 11% during the first half of the year. Hollywood has been anticipating this move, with the majors eager to roll out UltraViolet as a way to ease the process of selling digital versions of its homevid titles that will store purchases in a digital locker, accessible through any Web-enabled device. With DVD sales continuing to decline at a rapid rate, studios are eager to offset any losses through digital sales but also through the growth of the Blu-ray, which has seen a 10% sales increase for the year so far, the DEG said. The number of Blu-ray households has grown 13% this year over the same period in 2010, through the sale of 4.9 million Blu-ray players, including those built into PlayStation 3 consoles. There are now 31.6 million Blu-ray players in U.S. homes. Disc and electronic sales and rentals across various platforms generated $8.3 billion during the first six months of the year, compared with nearly $8.8 billion last year. While DVD and Blu-ray sales fell 18.3% during the first half, the DEG is “encouraged” by signs of “stabilization” during the second quarter, which was down just 3.6% over the first quarter’s 6.4% drop. “Avatar” moved 12 million discs during the second quarter in 2010. Overall rentals rose nearly 11% to earn nearly $4.2 billion. Figure includes VOD, streaming, kiosk and other physical rentals. Broken out, subscription-based streams of rented fare through companies like Netflix rose 46% to collect nearly $1.6 billion during the first half of 2011. Kiosks exhibited the second highest growth at nearly 40% to earn $806 million. Electronic sales of films is still rising slowly at 4% during the first six months, earning $270 million, yet VOD is at $929 million, also up 4%.