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PC Storage of Video Entertainment on the Rise, NPD Study Finds

23 May, 2005 By: Erik Gruenwedel

About 13 percent of functioning Internet-enabled homes have up to 15 video files containing TV programming and movies on their personal computer, according to preliminary findings of an ongoing pilot study from The NPD Group, a Port Washington, N.Y.-based research company.

The number of household computers storing video files of at least 150MB last year was 8 percent, based on data collected voluntarily from an anonymous test group containing 40,000 PCs.

“What will trouble many, especially in the film and video industry, is that some consumer collections include material that is clearly pirated,” said Russ Crupnick, president of The NPD Group's music and movies division.

Crupnick said the study eliminated from consideration video snippets from 10 seconds to 10 minutes and focused on material “substitutive” to other forms of acquired video, such as DVD.

In March, the study found feature films — including The Ring Two, Million Dollar Baby, Ocean's Twelve, Lemony Snicket's A Series of Unfortunate Events and Team America: World Police on computers in advance of their DVD release dates.

“These are not [titles] people could have gone to Best Buy and been viewing legitimately on a DVD player,” Crupnick said. “We [also] found an extraordinary mix, from standard movie fare and adult content to extreme adult content and complete seasons of “The OC,” “Family Guy” and “The Simpsons.”

While much of the material is being downloaded from peer-to-peer networks or ripped illegally, Crupnick said the purpose of the study is determine the majority source(s) of the content — including from commercial download services CinemaNow and MovieLink — and what consumers are doing with it.

“The [Motion Picture Association of America] is dealing very much with physical piracy [illegal recording of theatrical movies], and we need to understand to what extent [online] digital piracy is impinging on the business as well.”

Crupnick technological “gating” factors — including relatively slow Internet connection speeds, internal DVD burners and hard drive capacity — have been supplanted by 50 percent market penetration of high-speed broadband connectivity in the home.

“The ability to acquire content from legitimate and illegitimate sources is becoming easier for the average household,” Crupnick said.

He hopes the study will help the studios market content to a growing consumer base that derives its entertainment media from the Internet.

“We know the content is out there,” Crupnick said. “How do we market to them so all of this becomes additive as opposed to replacement for physical media?”

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