VSDA and NARM? Maybe. DVD and Music? Definitely.29 Aug, 2004 By: Kurt Indvik
Video is becoming an integral part of the music experience and music retail business — a trend made clearer during the recent annual convention of the National Association of Recording Merchandisers (NARM) in San Diego.
The core business may still be about music, but the media is now as much video as it is audio.
As our coverage of the event in this week's issue of Video Store Magazine shows, music retailers pounded by four straight years of sagging CD sales are excited about a number of trends, not the least of which is the DualDisc format (CD on one side, DVD on the other) and a burgeoning interest in music DVDs. To top it all off, CD sales are on the upswing for the first time since 1999, recording a 9 percent increase year-to-date over last year.
It's very exciting to hear that music DVD sales are running at about double the rate of last year, cresting 15 million units to date so far this year. One music DVD supplier with whom I spoke recently thinks this holiday season will see record numbers of music DVD releases. And as more and more households install home theater and surround sound systems, it could very well be that the demand for music DVDs, which fits so perfectly with the growing home theater trend, will see a breakthrough this season and into 2005. Certainly, NARM attendees are poised to catch this wave, and traditional home video retailers should also be planning to aggressively pursue music DVDs as a growth business.
Another interesting line of discussion at NARM was the development of CD-burning stations in retail outlets. That's a natural service for retailers who want to capture a portion of the legal downloading business that is expected to grow into the billions of dollars in the next several years. Perhaps several years from now, if the legal digital downloading of movies grows to a critical mass, there might be some opportunity for video retailers to offer a similar service to customers who do not have broadband access in their homes — for a fee, of course.
As the Video Software Dealers Association and NARM continue their merger discussions, it will be an interesting exercise for retailers from both industries to explore the commonalities they share and ways each can learn from the other as their businesses continue to meld together as one entertainment software retail industry.
* * *
It's hard to imagine what the disc-based entertainment industry would be like today without the incredible influence of Emiel Petrone, whose sudden passing recently came as a shock to many in the industry.
You can read about his contributions to our industry in this week's issue, but it's safe to say that Petrone's legacy in the development of the CD format, his trailblazing in interactive media with CD-Interactive (which is where I first met him) and his leadership role in DVD as founding chairman of DEG: The Digital Entertainment Group will last for many years to come. He will be greatly missed.