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DVD's Going Down the Tube

3 Sep, 2004 By: Thomas K. Arnold

The size and escalating popularity of the TV DVD category is mind-boggling. Here at Video Store Magazine, we're in the midst of producing the first-ever TV DVD Awards and have received more than 150 entries from suppliers, in 12 categories. A lot of the stuff that's come in I've never even heard of, and yet judging from the elaborate boxes and special features custom-made for the DVD release, there's a ready and willing audience out there for even the most obscure TV shows.

As we head into the fourth quarter, one of the biggest issues is the crunch for shelf space. Several of my colleagues have already addressed this issue, so I won't go there (at least not until my next “big picture” story in VSM).

But I will clue you in on one new development: Retailers are jumping all over TV DVD, to the point of allocating more space in their stores for television product. Best Buy, Target, Wal-Mart and virtually all the other big sellthrough drivers are committing more space to TV DVD this fourth quarter — a fact that was communicated early in the year to the folks at Universal Studios Home Video, who responded by finally jumping into TV DVD in a big way this summer after two years of sitting on their TV library.

TV DVD isn't just turning heads at sellthrough. At a recent panel discussion I led at the EMX conference in Hollywood earlier this week, Ted Sarandos, chief content officer of Netflix, revealed that TV DVD accounts for 12 percent of the subscription rental service's overall revenue and is the fastest-growing segment of the company's business. Movie Gallery's Ted Innes added that his rental chain has added a dedicated TV DVD section to its new-release wall.

Will this bubble burst? Our market research department predicts consumers will spend more than $2 billion on TV DVD product this year, up from less than $1.5 billion in 2003.

Based on my own collection at home — and the gobs of shows and series submitted for our awards — we've only scratched the surface. I'm not just collecting the stuff, I'm watching it at the expense of hot new movies.

I'm currently on episode three of “American Dreams,” a show I had never even heard of — I'm not an avid broadcast TV watcher — until it came to be on DVD.

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