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Netflix Dominates Digital Movie Consumption

15 Mar, 2011 By: Erik Gruenwedel

Netflix subscribers are streaming more than six out of 10 movies watched online, topping digital sellthrough and transactional video-on-demand, or VOD, according to a new report from The NPD Group.

The Port Washington, N.Y.-based research firm said Netflix accounted for 61% of the movies downloaded or streamed from January through February, followed by Comcast at 8%, and a three-way tie for third at 4% among DirecTV, Time Warner Cable and Apple.

Digital video now accounts for 25% of overall home entertainment consumption, including electronic sellthrough, Internet VOD, cable VOD and subscription streaming, according to NPD.

“Sales of DVDs and Blu-ray Discs still drive most home-video revenue, but VOD and other digital options are now beginning to make inroads with consumers,” said Russ Crupnick, entertainment industry analyst for NPD. “Overwhelmingly digital movie buyers do not believe physical discs are out of fashion, but their digital transactions were motivated by the immediate access and ease of acquisition provided by streaming and downloading digital video files.”

According to NPD’s video survey of more than 10,000 respondents, Apple’s iTunes platform received higher marks (than Netflix) for availability of new releases, while the Los Gatos, Calif.-based online disc rental pioneer received top marks for ease of use and economic value.

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