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Player Promos May Help Disc Sales

4 Oct, 2001 By: John Jimenez

Everyone knows DVD market share is growing, to 25 million homes by theend of the year if analysts’ projections are correct. Not only are more players being purchased as the price comes down and video game consolesincorporate DVD capacity, but many are given away free as part of promotions.

One example is the promotion Sprint PCS wireless and Circuit City ran from Sept. 16 through Sept. 29. Anyone who purchased a Sprint PCSWireless phone and signed up for service at Circuit City got a free Apex DVD player valued at $99.99.

“We’re trying to take wireless into mainstream products, to tie intoproducts that are hot,” says Sprint PCS senior director of indirect retail Bill Fatter. “[DVD players] seem to have the most appeal rightnow.”

Analyst Tom Adams of Adams Media Research agrees. “It’s the hot new consumer product of the year,” he says. “No new technology product isgoing to sell more units.”

DVD players are so hot right now, they tie in well with many consumer goods, but Fetter believes they are a particularly good fit withwireless phone services.

“We’re trying to segment and go after the 20 to 40 [-year-old] segment and that’s the major demographic of people buying DVD players,” he says.

Fetter says Sprint PCS tries to tap into a product a retailer is successful with. He says he may look at DVD software or CDs for apromotion with Best Buy.

Bill Cimino, s spokesman for Circuit City, says DVD players are very popular purchases at the chain and the APEX models do well because of their functionality, particularly the ability to play MP3 files.

Colton Manley, director of media for Apex Digital, says the company participates in numerous promotional tie-ins, including one with AT&T aswell.

The question then becomes, will the free players translate to increasedsoftware sales? Logic dictates they will.

“No one’s going to buy a DVD player and not have it affect their consumption of movies,” says Adams, who adds the same applies when the player is free.

Circuit City doesn’t comment on its promotions, but Cimino says DVD software is always popular.

It’s Adams who sums up the effects of free DVD promotions best: “Whatever grows hardware penetration is going to have a positive impact on software sales.”

Additional reporting by Ralph Tribbey.

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