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DEG: Blu-ray, Digital Making Up for DVD Revenue Declines

6 Aug, 2013 By: Chris Tribbey

Consumer spending on home entertainment dropped slightly during the second quarter of the year, but strong Blu-ray Disc and electronic sellthrough (EST) sales still have the industry up through the first half of 2013, compared with the first six months of 2012.

During the second quarter of the year consumers spent an estimated $3.94 billion on home entertainment, down 1.35% year over year. Through six months, spending is up more than 2% at $8.63 billion, according to data released Aug. 5 by DEG: The Digital Entertainment Group.

Blu-ray Disc sales were up 15% over the first half of 2012, with new-release Blu-ray product sales up 19%. Blu-ray catalog product sales were up more than 8%.

Overall digital revenue in the first half of the year was up more than 24% to more than $3 billion, with EST revenue up more than 50%, DEG reported, crediting the increase to convenient access to digital collections and greater availability of digital at retail.

After a first-quarter gain of 2% for packaged media, overall packaged-media sales were down nearly 13% in the second quarter compared with a year ago, and down 4.7% in the first half. However, the jump in Blu-ray and EST revenue for the first half of the year helped offset the decline in DVD sales, making overall sellthrough ($4 billion) flat vs. the first six months of 2012, DEG reported, dropping just 0.2%.

Consumers bought more than 5 million Blu-ray-compatible devices during the first half of 2013, bringing the total number of Blu-ray devices in American homes to more than 61 million.

Overall rental revenue — physical and digital — was down more than 5.5% through the first half of the year, with subscription disc rental revenue suffering the biggest hit, a nearly 21% decline to $531 million. Kiosk revenue was down nearly 4% to $955 million.

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