A bit of good news for Hollywood this week with news that while DVD sales slid last year, sales for Blu-Rays and digital content delivery rose.
Consumers spent $18 billion buying and renting discs and on digital movies in 2011, a 2% decrease from 2010, the Digital Entertainment Group (DEG) will report Tuesday.
Sales of Blu-ray discs topped $2 billion for the first time, up 19% from 2010. But DVD sales dropped 20% to $6.8 billion.
Still, home video executives were satisfied with the results considering the economic challenges of the past year and an underwhelming box office slate of films hitting retail.
New releases coming to home video in 2011 had total box-office revenue about 9% below those in 2010, said Warner Home Video President Ron Sanders, who is also president of the DEG.
Total movie sales dropped 12% to $9.5 billion, from 2010. Total movie rentals remained steady at $7.5 billion, down less than 1%. Digital sales, including streaming movies, rose 50% to $3.4 billion.
The number of homes with Blu-ray players grew to 40 million, 38% higher than in 2010. Also on the rise: the number of homes with HDTVs, which now tops 74.5 million. “Consumers and movie lovers are really investing in HDTVs and Blu-ray players to get their home theaters the best they can possibly be,” DEG Executive Director Amy Jo Smith says.
Hollywood hopes to keep Blu-ray disc momentum rolling in 2012 with increased portability of purchased films. The first discs supporting the industry’s UltraViolet format were launched in 2011. That format allows for downloading a digital version of a film into a cloud-based online locker that can be accessed via smartphones and tablets at no extra cost.
“Consumers want to consume different movies in different places” says Craig Kornblau, president of Universal Studios Home Entertainment and DEG vice president. “There are consumers who are more interested in (only) having movies in the cloud. They can actually start that collection today. That doesn’t mean physical discs will go away completely.” Among the first studios in 2011 with UltraViolet discs:
Universal (Cowboys & Aliens), Sony (Friends With Benefits) and Warner (Green Lantern). Studios plan to announce Tuesday more than 100 UltraViolet discs due this year, including releases from Paramount and Fox.
“We see UltraViolet as kind of icing on the cake,” says Fox Home Entertainment President Mike Dunn. “Once that ecosystem is in place, you have the opportunity … to go from a niche market to mass market.”
Adds Mike Vorhaus of Frank N. Magid Associates, “One of the top features digital consumers value is transportability across devices.”