Packaged Media Continues to Dominate Sellthrough Market4 Apr, 2016 By: Erik Gruenwedel
It may be a streaming (rental) world, but at retail, sales of DVD and Blu-ray Disc movies and TV shows continued to flourish in 2015 — representing nearly 80% of the total domestic sellthrough market, according to new data from The Convergence Consulting Group. Sales of digital movies and TV shows accounted for 21% of the market.
The sellthrough market, including packaged media and electronic sellthrough, reached $8 billion last year, according to DEG: The Digital Entertainment Group.
For rentals of movies and TV shows, CCG estimates subscription video-on-demand represented 51% of revenue, followed by Redbox and other kiosks (17%); transactional VOD (cable, satellite, telecom at 15%); video stores (6%); Netflix by-mail (6%); and online transactional VOD (5%).
DEG said total rental revenue, including disc, VOD and kiosk, topped $5 billion in 2015. SVOD revenue alone topped $5 billion.
CCG estimates this year that SVOD revenue will reach 59% of the total movie/TV show rental market; kiosks will reach 14%; pay-TV VOD (12%); video stores (5%); Netflix by-mail (5%); and online transactional VOD (5%).
Indeed, CCG forecasts that over-the-top revenue from CBS All Access, HBO Now, Hulu Plus, Lifetime, Netflix, Noggin, PlayStation Vue, Seeso, Showtime OTT, Sling TV, Starz, Tribeca Shortlist, etc., grew 29% to $5.1 billion in 2015 and is expected to reach $6.7 billion in 2016.
Meanwhile, the report said there was a decline of 1.13 million domestic pay-TV subscribers last year — up from a decline of 283,000 in 2014. CCG forecasts a decline of 1.11 million pay-TV subs in 2016.
The culprit is cord-cutters. At the end of last year, CCG estimated 24.6 million domestic households did not have a traditional pay-TV subscription with either a cable, satellite, or telco provider. That was up from 22.5 million in 2014. The report forecasts 26.7 million households without a pay-TV subscription at the end of the year.