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DVD Sales Explode in January as VHS Wanes

28 Feb, 2002 By: Judith McCourt

DVD sales exploded in January, accounting for almost two-thirds of the total DVD and VHS units sold, according to VideoScan data.

While Wal-Mart data is not included in the January tally, Video Store Magazine market research estimates Wal-Mart's current sales mix is 55 percent VHS and 45 percent DVD -- a radical change from last year when the mix was an estimated 80 percent VHS and 20 percent DVD.

Universal Studios Home Video's The Fast and the Furious was the bestselling DVD in January while Buena Vista Home Entertainment's Atlantis: The Lost Empire reigned as the best VHS seller for the month.

With the number of DVD players skyrocketing it's no surprise more consumers are abandoning the VHS format in favor of DVD. In January, consumers showed a strong preference for DVD, with the format's sales outpacing VHS sales by a margin of 1.9 to 1.

According to the DVD Entertainment Group, consumers have purchased 31.1 million DVD players, which includes “Home Theater in a Box” systems, combination systems and portable DVD players, since 1998. More than half of these units, 16.7 million, were purchased in 2001.

By comparison, sales of VHS cassettes accounted for 67 percent of videos sold in January 2001 and held steady through the midpoint of 2001. VideoScan aggregate sales data for the first six months of 2001 showed that 64.5 percent of all videos sold were VHS.

The tide turned in the last six months of 2001 as VHS sales started to wane. In August, VHS sales fell to 54 percent of the tally and continued to decline. In October it was a tossup, with the pie almost evenly divided. Fourth-quarter holiday buying breathed life into sagging VHS sales but it was short-lived.

January sales data indicate VHS cassette sales are in retreat. A look at the top 10 sellers for both formats show that almost three times as many units of the top 10 DVD sellers were sold compared to the top 10 VHS sellers. Universal's The Fast and the Furious, the top-selling DVD, sold five times as many units as the top-selling cassette, Buena Vista Home Entertainment's Atlantis: The Lost Empire.

Universal Studios Home Video was the sellthrough market share leader in January, with Universal and DreamWorks product accounting for 20.7 percent of unit sales. Universal's share of DVD sales was even stronger, with the supplier racking up 23.5 percent of DVD unit sales for a No. 1 finish in that category as well. American Pie 2, in both the rated and unrated versions, was also a heavy hitter at the sales counter. DreamWorks Home Entertainment's fourth quarter release Shrek remained among the top 10 DVD sellers for the month, placing No.8 in DVD sales for January.

Buena Vista was the indisputable leader in VHS unit sales, with 21.5 percent of the tally. Buena Vista includes the Disney, Dimension, Hollywood, Miramax and Touchstone labels. Buena Vista laid claim to four of the top five VHS sellers in January, with Atlantis turning in the best performance. Combined DVD and VHS sales of Atlantis also made it the No. 3 overall seller for the month. In the overall sweeps Buena Vista finished in the No. 3 spot, with 15.7 percent of units sold.

Warner Home Video, which includes Warner, New Line, HBO and PBS titles, finished No. 2 in the overall sweeps, with 16.5 percent of all units sold. Warner was also a second-place finisher in both the DVD and VHS sweeps, with 17 percent and 15.7 percent of January sales, respectively. New Line Home Entertainment's Rush Hour 2 was the supplier's top seller in both formats.

Action adventures were the genre of choice in January, accounting for 26 percent of the DVD and VHS units purchased by consumers. Action adventures were the top sellers in the DVD format (32.3 percent) and finished fourth in VHS sales (14.3 percent). Meanwhile, comedies were a close second with a 24.2 percent share. Comedies topped the VHS list with 20.1 percent of the units sold and placed second in DVD sales with a 26.3 percent share.

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