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|NPD: Blu-ray Sales Begin To Cover DVD Losses
By Greg Tarr -- TWICE, 6/8/2011
Port Washington, N.Y. - Recent growth in sales of Blu-ray Disc players and content has prompted CE market analyst The NPD Group to issue a report showing evidence that Blu-ray sales are beginning to offset declines in consumer DVD player and content sales.
According to the group's "Entertainment Trends in America" report, 15 percent of U.S. consumers reported using a Blu-ray player in the prior six months in March 2011, up from 9 percent the prior year.
In comparison, 57 percent of U.S. consumers reported using a standard DVD player in 2010, which is unchanged from 2009.
According to NPD's Blu-ray Disc Report, 49 percent of PS3 owners are viewing Blu-ray movies on their game consoles at least once a month, which is also adding to the base of physical-disc users. Year-over-year sales of set-top Blu-ray player units increased 16 percent, NPD said.
According to NPD's separate Blu-ray Disc Report, there are currently approximately 116 million physical-disc buyers in the U.S., which is down from 128 million in 2009. However, the nearly 26 million Blu-ray buyers helped keep that number from sliding further.
Blu-ray buyers are also beginning to buy more discs than they did in 2009 or 2010, including both new releases and older catalog content, according to the report.
"Because fewer hot titles came out of the theatres in time for first quarter release, the physical video-disc market was a bit disappointing -- especially coming off of a good first quarter last year; but consumer response to the Blu-ray format remains strongly positive," stated Russ Crupnick, NPD entertainment industry analyst.
"While Blu-ray may not be the replacement for DVD that many once hoped for, it is certainly adding strength to the physical video-disc market. This added stability is helping to extend the life of discs, even as digital options gain in popularity."
According to consumer feedback, NPD said Blu-ray's technology advantages are being recognized by more and more people, in addition to the format's value proposition, and benefits from packaging (e.g., combo packs that offer a DVD, Blu-ray and digital copy).
Eight out of 10 current and prospective owners of Blu-ray set-top boxes cite high-definition quality and technology as the reason they purchased, or intend to purchase, a Blu-ray player, NPD said.
NPD reported that consumers are also noticing the better pricing and value of Blu-ray, as prices of hardware have declined.
Word of mouth is helping grow the Blu-ray customer base, as well. Thirty-six percent of consumers who intend to buy a player were influenced by the product recommendations of friends and family members.
"It wasn't too long ago that most consumers felt DVD was â€˜good enough,' and while it's true DVD is a terrific format, more consumers are now recognizing that Blu-ray does indeed deliver a superior experience," said Crupnick. "Certainly the fact that prices are now within the budgetary range acceptable to rank-and-file consumers is helping bolster the overall value proposition of the Blu-ray format."
NPD also noted that digital services have driven increased interest in Blu-ray players, with 50 percent of consumers who intend to buy Blu-ray set-top players in the next six months citing a desire to use available subscription video-download services as a primary reason.
"As more and more buyers make the decision to obtain the superior picture and sound technology of Blu-ray, there is also more awareness that the same player that delivers that experience can also provide access to digital services that are gaining the attention of American consumers," Crupnick said.
|Blu-ray making up for only some of the drop in DVD sales
(0) (0) (22)
June 8, 2011 | 10:38 am
The number of Americans buying movie discs dropped 9% from 2009 to 2011, but would have fallen more dramatically without the growth in high-definition Blu-ray discs, according to a new report.
In total, 116 million Americans are estimated to currently buy movies on DVD or Blu-ray, according to the NPD Group, down from 128 million in 2009. However, 26 million of those people are buying discs on Blu-ray, which are more expensive for consumers and more profitable for makers than standard DVDs.
The percentage of the population who are buying Blu-ray discs jumped from 9% in 2010 to 15% in 2011, according to two online consumer surveys conducted by NPD.
"While Blu-ray may not be the replacement for DVD that many once hoped for, it is certainly adding strength to the physical video-disc market," NPD entertainment industry analyst Russ Frushtick said in a statement.
The report did not include any data on digital distribution, a market that is also growing and helping to make up for some, but not all, of the downturn in DVD sales and rentals. A recent study by IHS Screen Digest said that Internet purchases and rentals of movies jumped 38% in 2010 to $385 million.
However, it did say that 50% of people who intended to buy a Blu-ray player were interested in part because many such devices also provide access to "subscription video download services" such as Netflix.
Also helping is that Blu-ray players and discs have been falling in price. "The fact that prices are now within the budgetary range acceptable to rank-and-file consumers is helping bolster the overall value proposition of the Blu-ray format," Frushtick said.
The NPD analyst also noted that the downturn in movie disc sales during the first three months of 2011 was magnified by a lack of popular movies, as indicated by soft box-office returns for the industry in the fall of 2010.
That drop was indicated in financial results for two studios. Universal Pictures' home entertainment revenue fell 24% in the first quarter of 2011, while Walt Disney Studios reported a 14% drop.
-- Ben Fritz
Blu-ray having a 25% unit share of the leading title with a $80 MSRP for this week may mean it might not be as poor a comparison with Alice in Wonderland as I thought. The Blu-ray revenue share of that title is even better than its unit marketshare so its going to generate more revenues than expected for Blu-ray considering there were no major theatrical releases.
I always felt Kosty was a gentlemen and movie lover even back in the day when we had opposite views on certain things. Lucky for us he loves movies in HD therefore moved past the format war and spends a lot of time providing valuable information on the health of the Blu-ray format. It is greatly appreciated. Too bad a few just can not see why Kosty has the enthusiasm that he does.
You mean Kosty IS a gentlemen. I have been reading his posts for many many years and have commented on his postings in other forums. He is truly a movie enthusiast at heart and his enthusiasm rubs off on me. Yes greatly appreciated!
Some Like It Hot was wonderful on BluRay. Yes the studios have been opening up the catlogue a bit in the past few months! More movies than I have money in my purse. This girl may have to get out her charge card to keep up!
Welcome TowerGrove, nice to see you posting here.
And I agree buyers will not go away, but clearly people are renting more and buying less. I see that increasing as optical disc declines and digital picks up more marketshare.
But the studios will always try to sell movies to consumers. Too much money to be made.