Saluting the Top Retailers28 Mar, 2016 By: Thomas K. Arnold
For the first time in nearly two decades, Home Media Magazine is spotlighting the top retailers in the home entertainment space. And for those of you who might remember the annual Top 100 ranking we compiled each year back when we were still known as Video Store Magazine, our Top 10 for 2016 will be a real eye-opener, underscoring how dramatically, and how drastically, our business has changed since the Top 100 days when retailers were ranked by how much income they generated by renting VHS videocassettes to consumers.
Indeed, the Top 10 for 2016 reflects the diversity of home entertainment options consumers have today as well as the disruptive business models that ultimately toppled Blockbuster Inc., which for years was perched at the very top of our Top 100, and also paved the way for digital delivery, both streaming and download sales, which most observers expect will soon dominate the business.
The big sellers of the digital video disc, both Blu-ray Disc and its older, standard-definition predecessor, DVD, continue to be a formidable force in home entertainment, both as a source of revenue for studios and other content owners and as a way for consumers to get the movies and TV shows they want. Walmart continues to lead the physical disc sellthrough charge, and while both Target Corp. and Best Buy no longer seem as enthused about the category as they once were, they continue to pump huge quantities of discs out into the market — and are largely responsible for the 8% increase in Blu-ray Disc sales our industry saw in the fourth quarter of 2015.
Not to be dismissed in the physical disc arena is Amazon, which despite its Amazon Prime Instant Video service is still a prime mover of Blu-ray Disc and DVD. Thanks to the free shipping offered to subscribers of Amazon Prime, consumers who want movies and TV shows on demand are also more inclined to buy their hot new disc releases from Amazon. I know — I’m one of them.
On the streaming front, you will notice that we have included Netflix as one of the Top 10 retailers. Despite the company’s attempts to position itself as a TV network, we continue to regard Netflix as a retailer, first and foremost — following the basic premise of home entertainment, which is to let consumers watch specific movies and TV shows where and when they want to, with the ability to pause, fast-forward and rewind — just like Blu-ray Disc, DVD and, way back when, the videocassette. Streaming is the new rental, and Netflix, in many ways, is the new Blockbuster.
We’ve also included iTunes on the list — the pioneer in selling movies and TV shows electronically, and still the dominant seller of downloads. In fact, one high-ranking studio executive recently told me that iTunes is now a bigger source of revenue to his studio than Target.
Because estimating revenue is such a specious proposition in this era of subscriptions and deep discounting, we have elected not to rank these retailers. Instead, we have relied on extensive research and interviews with studio executives, analysts, researchers and actual retailers to come up what we believe is an accurate list of the Top 10 home entertainment retailers, and have listed them alphabetically.
We’re already getting some great feedback, so in all likelihood we’ll do this again next year. And who knows — perhaps this will become an annual tradition, just like our Top 100 once was.