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iTunes Losing Movie Rental/Sales Market Share

10 Jul, 2017 By: Erik Gruenwedel

Apple iTunes, which in 2006 created the market for digital movie/TV show sales and rentals, has reportedly lost some of its leadership position.

The platform now accounts from 20% to 35% of digital revenue — down from more than 50% five years ago, according to which cited sources familiar with the situation.

Unlike box office tallies, studios and digital and physical media retailers do not disclose actual sales figures.

Notable iTunes competitors include Amazon Instant Video with 20% market share, Comcast’s Xfinity Store with 15%, followed by Google Play, among others.

Indeed, electronic sellthrough was a key revenue driver in the first quarter, with sales up 13% to $572 million, from $505 million a year ago, according to DEG: The Digital Entertainment Group. Digital sales of theatrical titles — notably animated — increased 30%.

Digital rentals declined nearly 5% to $571 million, from $599 million a year ago. PricewaterhouseCoopers said digital movie rental revenue dropped 4% to $1.8 billion in 2016 — the first decline in years.

“Comcast and Amazon have been quite aggressive of late and taken quite a lot of the business,” Dennis Maguire, former worldwide president of Paramount Home Media Distribution, told The Journal.

In addition, subscription video-on-demand services such as Netflix, Amazon Prime Video and Hulu continue to grab subscribers and discretionary spending on home entertainment by offering original movies and TV shows.

Subscription streaming revenue rose more than 26% to $1.8 billion in Q1.

About the Author: Erik Gruenwedel

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