Previously Viewed Titles Gain Bigger Foothold in Market22 Jan, 2004 By: Melinda Saccone
Revenue from previously viewed title (PVT) sales continued to bolster rentailer revenue in 2003, according to Video Store Magazine Market Research estimates.
PVT sales have become one of the fastest-growing revenue streams for rentailers, with consumers doling out $1.3 billion purchasing previously viewed product in 2003. DVD accounted for the majority of those sales, thanks to its dominance in the rental arena. Previously viewed disc sales totaled $841 million, accounting for 64.7 percent of total PVT sales in 2003.
In the past few years, PVT sales have continued to post double-digit growth, bolstered by the increase in units shipped into the rental pipeline. PVT sales have more than doubled since 2000, according to Video Store Magazine Market Research estimates. PVT sales rose from an estimated $538 million in 2000 to $1.3 billion last year.
Helping to bolster this secondary revenue stream is the disc. With its lower-than-rental-VHS cost and its command of a higher premium in the secondary sales market, rentailers have taken advantage of the pricing differential to bring in heavy quantities of DVD product for their rental inventories.
Last year, PVT discs commanded an average price of $10.40, according to surveys conducted by Video Store Magazine Market Research in the third quarter. PVT cassettes averaged just $7.80.
Rising PVT sales can be linked to the unprecedented levels of rental product in the marketplace.
Last year, rentailers purchased nearly 20 million copies of the top 10 releases for their rental inventories, with 64 percent of the units on disc. By comparison, in 1998 rentailers purchased just 8.9 million units of the top 10 releases for their rental inventories.
The increase in available copies for rent has translated into demand being satisfied at a much faster pace. This has led rentailers to sell off their excess rental inventory as previously viewed product even earlier.