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THE MORNING BUZZ: The Hits Just Keep On Coming

7 Jan, 2002 By: Thomas K. Arnold

Happy new year--and welcome to one of the biggest weeks for the home entertainment industry. This is the week the Consumer Electronics Show is held in Las Vegas, and once again DVD is generating a lot of buzz.

Warner Home Video president Warren Lieberfarb will speak at the DVD Entertainment Group's traditional CES meet, unveiling the latest numbers insiders say are sure to underscore DVD's explosive growth in the fourth quarter. And recordable DVD, in all its various configurations, is expected to be the hot item at this year's CES, with all sorts of press releases coming in touting this-and-that company's new DVD-ROM drive or set-top DVD recorder.

And you thought 2001 was The Year of DVD. My prognosis for 2002: You ain't seen nothin' yet.

A bit of anecdotal evidence: I drove cross-country to visit my wife's family in Birmingham, Ala., over the holidays. In the small rural town of Pelham, 15 miles south of Birmingham, the local Movie Gallery store has been completely remodeled since my last visit over the summer. New DVD releases dominate the front of the store, filling several walls, top to bottom. New VHS releases have been relegated to the back of the store. And there are significantly more DVD titles--and DVD units--than videocassettes.

In New Orleans, the Tower Records and Video Store on Bourbon Street has a big new sign in the front window, promoting DVD rentals and sales.

At a Wal-Mart store in western Louisiana, in the heart of bayou country, merchandisers crowded with $15 DVDs almost block customers' entry into the electronics department.

And in San Antonio, home to the Alamo, every video store I drove by has "DVD," in some form or another, prominently displayed in the front window.

Last night, in a Hampton Inn motel room in the New Mexico town of Las Cruces, I checked my e-mail and found this missive from veteran independent retailer Tom Hannah of Video Quest in Joliet, Ill. It's a great coda to today's column:

"The first week of January is shaping up to be excellent...if the next two days hold it will easily be our biggest week ever. Ordinarily I spend about $1,000 per month on advertising. Knowing that from Dec. 20 – Jan. 20 would be my hottest month I spent $2,500 on a new DVD-oriented ad blitz. The result has been so good that I've been picking up a few extra copies of most DVDs at Best Buy....

"DVD rentals are now making up 44 percent of new release rentals. I expect that to hit 50 percent by March...maybe sooner."

As Tom would say, God bless America--and DVD.

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