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A Few Predictions for the New Year

23 Dec, 2003 By: Stephanie Prange

The past year gave the video industry much to cheer. We saw the DVD business pass the 50 million household mark and DVD households continue to buy at the much the same rate as early adopters. The sellthrough DVD juggernaut didn't slow as many had predicted. Rentals hit a few snags, but continued to hold fairly strong despite a sea change in the business.

DVD player prices hit a new low -- some priced less than the very DVDs they were designed to play. Low-priced DVD players were everywhere during the holidays, loss leaders for such discounters as Wal-Mart, much as DVD software titles had been the whole year.

“This was the single biggest growth year in DVD households we've ever had and ever will have,” said Craig Kornblau, president of Universal Studios Home Video to Video Store Magazine recently.

Indeed, it's hard to believe there will be growth that can top this year. But when I look back over the past few years, we've consistently been surprised by the success of DVD. Could the little disc pull off another corker?

Here are my humble predictions.

* 2004 will again surprise retailers with households' continued interest in buying DVDs. The household buy rate will slow very little.

* Rentals will finally take a visible hit this year, as consumers prefer to buy rather than rent. But the rental falloff will be overblown by Wall Street, and retailers will be able to recoup much of the loss with previously viewed title sales.

* Used DVD trading will grow as retailers and consumers catch on that an old DVD is almost as good as new -- and it's a lot cheaper.

* Software and hardware that helps consumers transfer home movie cassettes to DVD will grow like never before.

Those are my top trends for 2004. I'd love to hear from others about their predictions for the New Year. Readers?

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