DVD's Many Sub-Businesses Keep Growing10 Sep, 2004 By: Thomas K. Arnold
DVD is becoming not so much one big business as a confederation of smaller businesses, many of which did not exist in the VHS era. TV DVD and music DVD are two examples, but they are hardly the only ones.
In the VHS era, for example, used-tape sales never amounted to much, even in the days when revenue-sharing picked up and there were lots of surplus cassettes floating around. Only with DVD did the market really begin to thrive, and now some rental dealers are reporting that what's euphemistically known as “previously viewed” sales have replaced late fees as their second-biggest source of revenue behind rental. At Movie Gallery, for example, the used trade brings in 10 percent of all consumer dollars.
There's also money to be made in niche markets such as documentaries and art films. Both categories are becoming bigger, thanks in large part to the emergence of online vendors — both rental (Netflix) and sales (Amazon) — whose cyberstorefronts are open to everyone the world over. Again, DVD gets at least some of the credit, because the inclusion of special features makes these titles more collectable and discs cost a lot less to ship than those clunky cassettes.
DVD also helped grow the home theater business, not so much because of the format's superior picture as its superior sound. With VHS, home theater would have been a waste of money; with DVD, it's become virtually essential.
Another of DVD's many sub-businesses is the market for mobile DVD players. Again, the trend toward putting video in minivans and SUVs began some years back, but as anyone who's driven cross-country with a bag of cassettes can tell you, it wasn't really practical until DVD. I remember road trips with cassettes flying all over the place; these days I can pack two dozen movies into a little album no bigger, or thicker, than a paperback.
This is why I feel certain DVD will go down in the history books as a lot more than just another successful consumer product launch. It's a pop-culture phenomenon, with a legacy that's likely to grow richer with time.