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High-def Discs Double Size of Download Market

4 Feb, 2008 By: Scott Hettrick

Consumers spent more than $260 million on high-def discs in 2007. Less than half that amount was spent on Internet downloads — $123 million — according to Adams Media Research.

I mention that only to provide perspective. Internet downloads and Web-delivered content are the hot topic these days. As a consumer, I welcome new viewing options that suit my preference. The more the better.

I consider Blu-ray Disc to be one of the most exciting of the cool new technologies. And I like Fox's digital copy for iTunes strategy, which takes away the download time that is still far too slow and cumbersome for the average consumer.

As exciting as all these new technologies are, it's important not to lose sight of where consumers are spending their money, and where studio profits will continue to come from for many years.

Analysts and some bloggers often have a hard time with the concept of peaceful co-existence and strong revenue from multiple formats simultaneously.

In fact, the beauty of all these new technologies is they are wonderful additional ways to enjoy movies and TV shows, but they do not negate or replace my primary desire of watching a movie, when possible, in full 1080p high-def with surround sound.

Sure, I can start watching a high-def movie download within seconds after clicking to do so, but it will still take hours to completely download. When it does finish downloading, it is compressed and not in full 1080p and does not have uncompressed audio. It takes up a ton of storage space. It doesn't have chapter stops. It doesn't have bonus features. And I can't lend it to a friend.

Adams projects that within five years digital download revenue will overtake the cable/satellite pay-per-view/video-on-demand market, which has taken decades to even reach the $1 billion mark.

Meanwhile, the market for movies on discs already stands at more than $24 billion. Having reached $260 million in the first full year despite being bogged down by a large-scale format war, Adams projects high-def discs will provide a big spark for growth in the overall disc market.

Sounds like there are a lot of formats and technologies to be bullish about — not just one.

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