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Predictions Past and Present

27 Dec, 2004 By: Stephanie Prange

Every year at about this time, I like to lay down a few predictions for the New Year — something that readers can look back upon and either chuckle or marvel at my prescience.

First, looking at last year's predictions, I can't say I was sorely off the mark. I predicted that the buy rate would slow very little, and all indications are that it has. I said used DVD trading would grow, and indeed it has, with Blockbuster jumping into the fray with its $8 in credit for trade-ins. Recordable DVD did gain momentum as unit sales of recordable DVD hardware increased more than 300 percent from 2003 to 2004, according to In-Stat/MDR research projections. And VHS may not be totally dead, but it's certainly on life support.

As for my prediction that rentals would finally take a visible hit in 2004, I think Video Store Magazine's transactional rental numbers bear that out. Video Store Magazine market research throughout the year showed double-digit percentage drops in rental transactions. Still, rental may just be taking another form through subscriptions. Blockbuster jumped onto Netflix's turf and instituted an online rental price war, bowing to the popularity of its business model.

My predictions for this year: n Buy rates of new releases will falter a bit as consumers' libraries bulge and they fill them in with used discs.

n Neither HD-DVD nor Blu-ray will make it to market in 2005 — we can only hope. DVD's only been around since 1997; VHS had 20 years of dominance. Can't we let DVD ride a bit longer?

n Independent rentailers will become primarily used-disc businesses as transactional rentals shrink.

n We'll have two — not three — major rental chains as Hollywood is swallowed by either Movie Gallery or Blockbuster.

That's my view of things. Now let me hear your predictions.

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