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IDC Study: DVD Market Growth to Continue Through 2006

28 Oct, 2003 By: Holly J. Wagner

The trend to incorporate DVD with almost every imaginable electronic device will continue with DVD recording functionality between 2002 and 2007, according to a new study from IDC that forecasts and analyzes the worldwide and U.S. DVD markets through 2007.

DVD recording will be a fundamental driver of the DVD market as the average selling price of DVD recorders falls from $699 in 2002 to $126 in 2007, and dual playback and recording functionality will quickly become the default feature set of DVD players, just as they have been for VCRs.

“The DVD market will continue to exhibit strong growth through 2006, driven by falling costs, diverse form factors and widespread adoption of DVD recorders by consumers,” said Susan Kevorkian, senior analyst with IDC's Consumer Devices and Technologies program. “However, the market will not sustain this kind of growth indefinitely. In 2007, IDC expects total DVD player unit shipments to decline modestly for the first time due to growing saturation worldwide.”

According to IDC's market forecast, worldwide shipments of DVD recorder decks will surpass DVD play-only decks in 2007, with DVD recorder deck revenue surging ahead of play-only deck revenue in 2005. As prices fall, DVD recording functionality will also be integrated into more and more devices, including combo DVD players and home-theater-in-a-box systems with DVD. Although the growth prospects for specific categories will vary, IDC expects worldwide unit shipments of recorder decks to grow at a 126 percent compound annual growth rate during the forecast period.

Other market accelerators through 2006 will include the integration of innovative features sets, such as hard-drive-based digital video recording (DVR), DVD-Audio and SACD support; and home networking technology, Kevorkian believes. While the market for high-definition DVD recording devices is also expected to grow modestly worldwide and in the United States during the forecast period, a number of barriers to widespread adoption must be overcome.

“Retail prices are falling rapidly across every DVD player category,” Kevorkian said. “To succeed in this environment and insulate revenue, consumer electronics manufacturers must differentiate their products by offering unique features sets and form factors while promoting fair use of content by consumers.”

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