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Disc Sales Dominate in January as Buyers Feed New Players

4 Mar, 2004 By: Judith McCourt

DVD sales dominated in January. Overall sales came in at $1.38 billion, with 91 percent of the dollars generated at retail coming from discs.

Consumer sellthrough spending on discs registered $1.25 billion in January, a month that typically produces heavy retail spending as the latest wave of DVD owners begin to amass collections. The strong legs of late-fourth-quarter releases, which performed well at retail, also boosted tallies. Overall DVD spending was up 18 percent from January 2003.

Eighty-six percent of total unit sales in January were for discs, according to Video Store Magazine Market Research estimates. By comparison, in January 2003 disc unit sales made up 76 percent of the pie.

The continued upswing in DVD purchases reflects the growing prevalence of the DVD-playing capability in U.S. households. In a recent study conducted for Video Store Magazine, nearly three-quarters of U.S. households said they had DVD capability, defined as one or more pieces of hardware that allow consumers to watch DVDs. Two-thirds of the survey respondents had dedicated set-top players, while 42 percent said they had hardware such as game consoles or a PC drive that allowed them to play discs.

Cassette sales were on the losing side of the equation, with unit sales falling 31 percent from January 2003. The effect of the drop was amplified when the falling price of cassettes is factored into the mix. Translated into dollars, January sales for VHS cassettes were off 37 percent, coming in at $127.52 million, compared with $201 million in the same month of 2003. The average cassette sells for a little more than $9.50, an 8 percent decline from January 2003.

The No. 1 seller in January was Universal Studios Home Video's American Wedding, which was released at sellthrough on both DVD and VHS. All versions combined sold an estimated 4.1 million units, according to Video Store Magazine estimates.

Warner, which includes New Line and HBO, finished the month in the top spot, with 16 percent of the units sold, according to Video Store Magazine Market Research estimates. Warner's second-place finish in DVD units sold for the month was boosted by its first-place showing in cassette sales. Freddy vs. Jason, a New Line title, released at sellthrough on DVD and VHS, was the best performer for Warner.

Meanwhile, Columbia TriStar finished in the No. 2 spot, with 15.3 percent of the take. While the supplier was the hands-down leader in DVD sales for the month, it finished No. 5 in cassette sales. Columbia had three of the top 10 sellers in January, but all were released at sellthrough only in the DVD format. The actioner S.W.A.T. was the studio's best seller in January, with consumers buying 3.5 million units of the DVD.

Buena Vista Home Entertainment finished in the No. 3 spot, with 13.6 percent of the units sold. Disney's top performer for the month was the Kevin Costner Western Open Range, which sold an estimated 1.9 million units.

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