[Wendell R. Breland]



Quote:
Numbers released by an industry trade group show the home entertainment business is weathering the Great Recession remarkably well, although the troubled economy is prompting more consumers to return to their old habit of renting rather than buying videos.

Full story here .


This story says, That brings the household penetration of HDTVs in the United States to approximately 44 million, up 13% from the end of last year and representing 38% of all U.S. households. I thought that number was more like 50% (from another article that I can not find). In any case BD seems to be doing fine with just a 38% potential market.

 

[PSound]

Good growth!!

Quote:
Consumer spending on DVD and Blu-ray Disc purchases took the hardest hit, slipping 13.5% in the first half, largely due to a weak first quarter in which sales tumbled 15%. The first-half tally was further bolstered by a 91% gain in Blu-ray Disc sales (to $407 million) and a 21% rise in digital distribution spending (to $968 million, which includes $196 million for electronic sellthrough).


Rental spending, on the other hand, was up an impressive 8.3%, again boosted by a significant (62%) gain in Blu-ray Disc spending but also aided by the proliferation of rental kiosks.


“Despite an extraordinarily challenging marketplace, the home entertainment sector continues to be remarkably stable overall, particularly with the growth of higher-margin businesses like Blu-ray Disc and digital distribution,” said Warner Home Video president Ron Sanders, president of the DEG.


He notes that home entertainment’s net operating profit contribution was down just 2.2% in the first half of 2009, because the studios get a bigger cut from Blu-ray Disc and digital distribution sales than they do from standard DVD.

Quote:
“The overwhelming satisfaction expressed by consumers with regard to Blu-ray shows great promise to the industry’s economic future and we are also optimistic regarding their appetite toward digital technologies,” Chapek said. “Both formats, converging together and resulting in one cohesive consumer experience, will present an opportunity for the industry to return to growth and eclipse our previous benchmarks.”

http://www.homemediamagazine.com/gen...deg-says-16398

 

[Kosty]

 http://www.videobusiness.com/article...?desc=topstory


Video Business has a similar article:

Quote:
Home entertainment revenue slips 3.9% in first half


PHYSICAL: DEG: Growth in Blu-ray, rental, electronic distribution offset steep DVD drop


By Marcy Magiera and Susanne Ault -- Video Business, 7/16/2009


JULY 16 | PHYSICAL: Total U.S. home entertainment spending for the first half of 2009 slipped just 3.9%, according to DEG: The Digital Entertainment Group, with a still steep decline in DVD sales being largely offset by growth in Blu-ray Disc sales, packaged media rental and electronic distribution.


DEG sized the entire pie at $9.73 billion for the half, including $3.4 billion in DVD and Blu-ray rentals, which were up 8.3%; $968 million in digital sales and rentals, including cable and satellite video-on-demand, up 21%; and $5.4 billion in DVD and Blu-ray sales, off 13.5%.


Blu-ray sales, which were up 91% to $407 million, offset declines in the studios’ core DVD sales business, which at slightly less than $5 billion for the half, was off in the neighborhood of 17%, according to Video Business calculations. DEG did not break out DVD sales in its announcement.

 

[Nosferax]



Quote:
Blu-ray sales, which were up 91% to $407 million

Well with that kind of sales I guess BR is doomed i tell you, DOOMED!!!

 

[fpconvert]

What do you think Gladiator, Braveheart and LOTR will do for those BD numbers?

 

[Nosferax]



Quote:
Originally Posted by fpconvert /forum/post/16837918


What do you think Gladiator, Braveheart and LOTR will do for those BD numbers?

I was being sarcastic

 

[Richard Paul]



Quote:
Originally Posted by Wendell R. Breland /forum/post/16835990


Full story here .


This story says, That brings the household penetration of HDTVs in the United States to approximately 44 million, up 13% from the end of last year and representing 38% of all U.S. households. I thought that number was more like 50% (from another article that I can not find). In any case BD seems to be doing fine with just a 38% potential market.

There are different estimates depending on the company but last year LRG estimated that the number of U.S. households with an HDTV was 34% and that of those HD households 58% of them watch HD programming from a multi-channel video provider.

 

[Wendell R. Breland]



Quote:
Originally Posted by fpconvert /forum/post/16837918


What do you think Gladiator, Braveheart and LOTR will do for those BD numbers?

Do not know, but I'm in for Gladiator and Braveheart

.

 

[Morpheo]



Quote:
Originally Posted by Wendell R. Breland /forum/post/16838165


Do not know, but I'm in for Gladiator and Braveheart

.

Yeah I'll pass on LOTR until the EEs are released. btw, I've noticed the Blu-ray shelves at my local BBs, Blockbusters and HMVs are growing larger

 

[Kosty]



Quote:
Originally Posted by Morpheo /forum/post/16838652


Yeah I'll pass on LOTR until the EEs are released. btw, I've noticed the Blu-ray shelves at my local BBs, Blockbusters and HMVs are growing larger

LOTR is a blind buy for me just for the lossless sound. I'll still keep my DVD box sets though.

 

[Lodef]

BD is not the only thing that is helping the industry!

http://www.avsforum.com/avs-vb/showp...postcount=9122

 

[Bozster]

So I'm just curious.. does this mean that digital downloads and online content actually made twice as much money as Blu-ray? ~410 million vs ~1 billion or am I missing something here?

 

[Nosferax]



Quote:
Originally Posted by Bozster /forum/post/16840249


So I'm just curious.. does this mean that digital downloads and online content actually made twice as much money as Blu-ray? ~410 million vs ~1 billion or am I missing something here?

They seem to combine rental and sale for digital vs splited sale and rentals for BD and DVD.

 

[Bozster]



Quote:
Originally Posted by Nosferax /forum/post/16840291


They seem to combine rental and sale for digital vs splited sale and rentals for BD and DVD.

Right.. but I'm just seeing that online distribution, DLs and VOD actually made more money then Blu-ray.


If we look at 5.4 billion in sales for DVD and Blu-ray sales together and then it says $400 million were Blu-ray sales, this means that those $400 mill. are less then 10%..


So if we look at 3.4 billion in rentals for both DVD and Blu-ray.. it's only natural to assume that rentals are most likely to be about 10% too. So around $300 million.


So if we combine the 2 we get for a total of $700 million for Blu-ray with rentals which still seems pretty low compared to the DL,VOD and online distribution.


I guess alternate ways of getting content seem to be generating more money then Blu-ray.

 

[PSound]



Quote:
Originally Posted by Bozster /forum/post/16840332


Right.. but I'm just seeing that online distribution, DLs and VOD actually made more money then Blu-ray.


If we look at 5.4 billion in sales for DVD and Blu-ray sales together and then it says $400 million were Blu-ray sales, this means that those $400 mill. are less then 10%..


So if we look at 3.4 billion in rentals for both DVD and Blu-ray.. it's only natural to assume that rentals are most likely to be about 10% too. So around $300 million.


So if we combine the 2 we get for a total of $700 million for Blu-ray with rentals which still seems pretty low compared to the DL,VOD and online distribution.


I guess alternate ways of getting content seem to be generating more money then Blu-ray.

That is technically true, but it is hard to make a 1:1 comparison. Blu-ray has a faster growth rate which makes sense since when all is said and done, it receives the same studio priority as DVD (physical media). That faster growth rate will have Blu-ray surpassing Digital Distribution, probably sometime in 2010. The overall physical media market is currently contracting, with Blu-ray not making up for the decline in DVD (even adding in Digital Distribution does not close that gap). The scenarios I have read say physical media will not see growth until 2012.


Digital distribution should show more consistent growth (from a lower base than physical media). That consistent growth will compel content owners to build a release schedule for digital distribution that mirrors physical media. That will give Digital the opportunity to see high double digit growth rate.

 

[Bozster]



Quote:
Originally Posted by PSound /forum/post/16840375


That is technically true, but it is hard to make a 1:1 comparison. Blu-ray has a faster growth rate which makes sense since when all is said and done, it receives the same studio priority as DVD (physical media). That faster growth rate will have Blu-ray surpassing Digital Distribution, probably sometime in 2010. The overall physical media market is currently contracting, with Blu-ray not making up for the decline in DVD (even adding in Digital Distribution does not close that gap). The scenarios I have read say physical media will not see growth until 2012.


Digital distribution should show more consistent growth (from a lower base than physical media). That consistent growth will compel content owners to build a release schedule for digital distribution that mirrors physical media. That will give Digital the opportunity to see high double digit growth rate.

Well I'm not saying it's not the case but from what I can see from online sources it seems that all of the content from Blu-ray seems to be available through alternate sources and in some cases even more content (like Vudu). So are studios really treating Blu-ray the same way as DVD? Or they are just treating it as another format including digital distribution and VOD?


And wasn't there an analysis that by about 2013 digital distribution should actually experience much higher growth and physical media and Blu-ray included will be at it's peak and going down? I'm sure I read it somewhere and I remember it being from a fairly reputable source. I think it was like Forrester Research or Futuresource or something like that but I might be wrong.

 

[PSound]

That sounds familiar, but I am not going to look it up right now. I know that Netflix expects physical media to peak fairly soon.

 

[Wendell R. Breland]



Quote:
Originally Posted by Bozster /forum/post/16840332


I guess alternate ways of getting content seem to be generating more money then Blu-ray.

There are many alternate ways to content that makes more money than Blu-ray but how alternate Hi-Def sources makes more money than Blu-ray?


Remember that old antiquated thing called OTA that was supposed to have disappeared years ago? Have you looked into the amount of money that OTA still makes?

 

[bt12483]



Quote:
Originally Posted by PSound /forum/post/16841422


That sounds familiar, but I am not going to look it up right now. I know that Netflix expects physical media to peak fairly soon.

What is your definition of "fairly soon"?

Quote:
Then you asked about DVD length, nothing has changed our view that our shipments and rentals will continue to grow and peak sometime in 2015 to 2018 as best we can tell.

http://seekingalpha.com/article/1166...all-transcript


The lower end is 7 years (from the date of this article, 2008). The upper end, another decade from the date of this article (which was from 2008).


Now in 2009....is 6 years "fairly soon"? How about 9 years?

 

[PSound]



Quote:
Originally Posted by bt12483 /forum/post/16841548


What is your definition of "fairly soon"?


http://seekingalpha.com/article/1166...all-transcript


The lower end is 7 years (from the date of this article, 2008). The upper end, another decade from the date of this article (which was from 2008).


Now in 2009....is 6 years "fairly soon"? How about 9 years?

Yes, that is fairly soon for the combined rentals of the current dominant format and the "heir apparent" (combined) to peak. I know if I am a business owner (of any business) and I am projecting my core business to peak in 6-9 years, that feels like it is coming up soon!


Especially in comparison to Digital Distribution. We do not know what comes after Digital Distribution, but I would expect that to continue growing for the next 20 years.



EDIT: Some more info on Physical Media peak from Netflix... I think your numbers may be the latest from Reed Hastings (I know he said in 2008 that DVD would peak in 5 years, but seemed to back-off on that when analysts got jumpy).

Quote:
While many companies this week were busy announcing layoffs, Netflix indicated a 45% jump in earnings. The company's already successful DVD rental service was buoyed by their recent broadband video partnerships, which allow the carrier to offer streaming services via Xbox 360, Roku, TiVO or BluRay players by both LG and Samsung. In a conference call with analysts, Netflix CEO Reed Hastings stated, not too surprisingly, those who use broadband streaming rent fewer physical disks. That spells trouble ultimately for physical media -- though Hastings says physical disk rentals still won't peak until at least 2013.

http://www.dslreports.com/shownews/N...cession-100476