Studios Spell Income D-V-D3 May, 2005 By: Hy Hollinger
Worldwide revenue from the filmed entertainment output of the major Hollywood studios -- including sales to theaters, home video, television and pay TV -- hit a record $44.8 billion last year, an all-media revenue increase of 9 percent from 2003's $41.2 billion, according to an executive summary submitted to Motion Picture Association of America (MPAA) companies.
The home video sector again fueled the surge, coming through with a worldwide hike of 10 percent -- from $18.9 billion in 2003 to $21 billion last year -- with DVD sales displaying dramatic rises of 46 percent internationally and 14 percent in the United States.
But worldwide theatrical revenue dipped 1 percent, despite a 9 percent rise in foreign theatrical earnings that moved the international market ahead of domestic with a 52 percent share of last year's theatrical take of $7.4 billion.
Worldwide television and pay TV showed growth, with television up 10 percent, to $12.6 billion, in 2004 and pay TV enjoying a 20 percent upturn in the United States and 17 percent abroad, which brought worldwide revenue to $4 billion, hailed by the report as a 38 percent increase over the past five years.
Currency exchange rates again figured prominently in bringing the U.S. film industry to new heights. The report -- compiled by the Motion Picture Association (MPA), the foreign arm of the MPAA -- observes that all-media yields in the 25 leading overseas markets went up 18 percent last year, but if 2003 currency rates were used, the gain from these territories would have come only to 8 percent.
The United States was the runaway provider of all-media revenue with $25.5 billion.
The top 10 foreign buyers of content from the major Hollywood studios as listed by the MPA are the United Kingdom ($3.9 billion), Japan ($2.1 billion), France ($1.9 billion), Germany ($1.8 billion), Canada ($1.6 billion), Spain ($1.2 billion), Australia ($1 billion), Italy ($967.8 million), Brazil ($403.3 million) and Mexico ($386 million).
North America, the report notes, represents 60 percent of worldwide all-media income, with both countries -- familiarly known as the domestic market -- adding $1 billion in all-media revenue last year, up 4 percent from the previous year. Europe showed the largest regional growth with $2 billion, or 18 percent, for a total of $12.3 billion in 2004.
The home video statistics continued to shine brightly despite the decline of VHS, which dropped 55 percent in North America from 2003. It was more than compensated by DVD activity, which increased 6 percent ($383 million) in 2004 in North America, fueled by a 3 percent growth in the U.S. and 9 percent in Canada. A five-year high of $6.1 billion in home video was achieved in Europe, which represented a 24 percent boost from 2003 and a 137 percent ($3.5 billion) increase from 2000, according to the MPA.
A breakdown of theatrical earnings showed France with the strongest growth in Europe, a 21 percent ($51 million) jump from 2003. The Asia-Pacific region, which accounts for 26 percent of international theatrical revenue, added $84 million last year, while Latin America's theatrical revenue went up 16 percent ($50 million) from the previous year.
The report notes that theatrical revenue from the Middle East/African region went up 53 percent ($38 million) over a five-year period, with South Africa and Turkey accounting for two-thirds of the region's theatrical take, with respective gains of 16 percent and 42 percent.