Digital Downloads Top $1.5 Billion for First Time for Home Entertainment Industry in 2014

Overall year was down 1.8% for the homevideo industry to earn $17.8 billion in the U.S.

Getting a last minute boost by Sony’s “The Interview,” the electronic sale of movies and TV shows in the United States grew 30% in 2014, to earn nearly $1.6 billion for the first time.

A record year was expected, with studios already seeing signs they would beat 2013’s benchmark of nearly $1.2 billion by the end of the third quarter, according to numbers tallied by the Digital Entertainment Group.

But the holidays proved an even bigger boon for Hollywood, thanks largely to buzz surrounding “The Interview,” and its digital release. In fact, electronic sellthrough spending was up 24% in the fourth quarter, generating $533 million from digital downloads, not the purchase of physical discs on websites.

Overall, total home entertainment spending in the U.S. fell 1.8% in 2014, to $17.8 billion.

DVDs and Blu-rays saw a nearly 11% decline in the year, generating $6.9 billion.

Physical video rental stores lost 27%, to earn $696 million, while revenue for kiosks fell 4% to $1.8 billion in 2014.

Instead, consumers turned to more digital options, boosting spending for key digital categories by double digits.

Subscription based VOD services like Netflix saw gains of 25% in the fourth quarter, topping $1 billion in revenue, and gained 26% for the year to top $4 billion.

The VOD category, however, was down nearly 6.7% to $1.96 billion, giving cable and satellite providers a reason to promote such services more in 2015.

Top sellers for the year were Disney’s “Frozen,” “Guardians of the Galaxy,” “Thor: The Dark World,” “Captain America: The Winter Soldier” and “Maleficent;” Lionsgate’s “The Hunger Games: Catching Fire,” Warner Bros.’ “The Lego Movie” and “Gravity;” New Line’s “The Hobbit: The Desolation of Smaug;” Paramount’s “Transformers: Age of Extinction;” Universal’s “Lone Survivor,” Fox’s “X-Men: Days of Future Past;” and DreamWorks’ “How to Train Your Dragon 2.”

UltraViolet also continued to gain traction among consumers, with accounts growing 30% last year. There are now more than 21 million accounts set up that have 110 million movies and TV shows in their libraries, combined.

The DEG also likes to keep an eye on hardware in the home, given that’s what home entertainment is played on — especially now that most new devices can connect to the web and to streaming or VOD services.

Overall, there are now 95 million U.S. households with an HDTV, and 70 million with a device, like set-top box or videogame console, that can play a Blu-ray disc.

The DEG reported the year-end figures at the Consumer Electronics Show in Las Vegas.

Popular on Variety

More Digital

  • lenovo-mirage-camera_3

    Google’s VR180 Format Stalls After Camera Manufacturers Pull Back

    Google’s plan to establish a new immersive media format on YouTube and beyond has hit a roadblock: VR180, the stereoscopic video format that Google launched with big fanfare in 2017, has lost some of its key supporters, Variety has learned. Camera maker Yi has all but given up on launching its long-promised VR180 consumer camera, [...]

  • UMC-Marriage-Boot-Camp-Hip-Hop-Edition-WE-tv

    WE tv, UMC Reteam on Bonus Content for 'Marriage Boot Camp: Hip Hop Edition' Season 2

    AMC Networks is touting the benefits of cross-pollinating content and promos across its TV and streaming properties. In the latest bit of synergy, the programmer’s WE tv announced the continuation of its partnership with sister company UMC (Urban Movie Channel) to produce a second season of “confessional” episodes for WE tv reality series “Marriage Boot [...]

  • Google Play Pass

    Google Launches Play Pass, Its $4.99 Apple Arcade Competitor

    Google officially launched its Play Pass game and app subscription service Monday morning. Play Pass gives users access to more than 350 premium games and apps for $4.99 per month. The launch comes just a few days after Apple unveiled it own game subscription service Apple Arcade. Apps and games included in this subscription do [...]

  • ESPN - Always Late With Katie

    ESPN Inks Facebook Deal to Bring Exclusive Shows and Content to Watch Service

    Disney’s ESPN is looking to expand digital reach across Facebook, under a new deal to distribute exclusive digital shows and content on the social giant’s Facebook Watch video platform. At launch, ESPN’s Facebook Watch lineup includes additional segments from “Always Late With Katie Nolan,” the late-night sports/comedy show premiering this week on ESPN2; exclusive versions [...]

  • David Benioff, D. B. Weiss, Carolyn

    Emmys 2019: 'Game of Thrones,' Jharrel Jerome Lead Social-Media Buzz

    HBO’s “Game of Thrones” and Jharrel Jerome, star of Netflix’s “When They See Us,” were among the leaders of social conversation during Sunday’s 71st Primetime Emmy Awards on Facebook and Twitter. “GOT” picked up 12 Emmys in total for its final season, including outstanding drama series, while series star Peter Dinklage picked up his fourth [...]

  • Oprah Winfrey

    Oprah Sets First Book-Club Pick for New Apple TV Plus Series

    Oprah Winfrey’s interviews with authors of her book club selections will be featured exclusively on Apple’s forthcoming Apple TV Plus service, and she’s announced the first book selection for the project: “The Water Dancer” by Ta-Nehisi Coates. Apple teamed with Winfrey for Apple TV Plus series “Oprah’s Book Club,” premiering Nov. 1 when the service [...]

  • NBC LX - Valari Staab

    NBCU Launches Digital News Outlet LX to Reach People Who Don't Watch Local TV (EXCLUSIVE)

    NBCUniversal’s local TV division is taking a new tack to reach younger audiences that don’t tune in to its traditional newscasts. On Monday, NBCU’s 42-station local TV group is launching LX — a digital news brand that will produce original content for online distribution and, in 2020, via a live-streaming internet network and multicast over-the-air [...]

More From Our Brands

Access exclusive content