Cashing In on DVDs


The New York Times had an article today about a pet peeve of ours: The continued rise of DVDs (and the negative impact on CD sales):

“Not since the advent of the videocassette in the mid-1980’s has the movie industry enjoyed such a windfall from a new product. And just as video caused a seismic shift two decades ago, the success of the DVD is altering priorities and the balance of power in the making of popular culture. And industry players, starting with the Writers Guild, are lining up to claim their share.

There’s good cause. Between January and mid-March this year, Americans spent $1.78 billion at the box office. But in the same period they spent $4.8 billion — more than $3 billion more — to buy and rent DVD’s and videocassettes.”

That’s an astounding amount of sales. How big and important are DVD sales? Consider:

“There’s not a sector of the entertainment industry to which DVD is not a significant, if not the dominant, contributor of revenue,” said Scott Hettrick, editor in chief of DVD Exclusive, a trade paper, pointing to the movie and television libraries being released on DVD. Even in the ailing music industry, he noted, music DVD’s are an area of growth.

This is very consistent with our arguments regarding increased competition for consumer’s entertainment dollars.

How much cash is sloshing around the industry? “This is an unprecedented, huge influx of new money into the motion picture business,” Dan Petrie Jr., president of the Writers Guild of America, West, said of the DVD boom.

With the explosion of DVD advertising, it is easy to forget that the plastic plate, the digital versatile disk, has existed in the marketplace for only seven years. Six years ago, before DVD mattered, Americans spent $18 billion on movie videocassettes. Last year, when the DVD ruled, they spent $22.2 billion on videos and DVD’s, according to DVD Exclusive, adding some $4 billion of new consumer spending to the entertainment pot without visibly affecting sales at the box office.

The New York Post noted: “The music DVD business is booming – in 2003, sales were up 104.5 percent from 2002, according to Nielsen SoundScan – and the recording industry is definitely taking note.”


See also the Variety article, Study sez DVD sales dim hunger for CDs. Variety is subscription only, so check out Corante’s CopyFight

Studios Rush to Cash In on DVD Boom
Published: April 20, 2004

NY Post, April 18, 2004

Study sez DVD sales dim hunger for CDs
Preference for pix mainly due to music’s high price, content available
Variety Mon., Mar. 29, 2004, 9:26pm PT

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