Discs still hold huge lead in home video

Study finds consumers spending mainly on DVD, Blu-ray

New research from The NPD Group finds that a whopping 88% of consumer home entertainment dollars go toward DVD and Blu-ray Disc purchases and rentals.

The research firm's March 2009 update to its "Entertainment Trends in America" consumer tracking study found that the U.S. home video consumer spent an average of $25 per month on all types of home entertainment. Most of that money, 63%, was spent on DVD purchases; 7% was spent on Blu-ray Disc purchases; and 18% went to DVD and Blu-ray Disc rentals from retail stores, subscription services like Netflix or kiosks such as those operated by Redbox.

Just 9% was spent on video-on-demand (VOD) and 3% was spent on digital downloads and online streaming.

When consumers were queried about all the ways they watched a full-length movie in the past three months, digital options were not widely used, although the numbers have grown over the past year. According to NPD 9% of consumers with home Internet connections streamed movies online in the past three months, up from just 5% last year; while 8% rented a digital movie download. Viewing movies downloaded through game consoles attracted fewer than 5% of consumers.

NPD research also found that 80% of digital movie downloaders also reported buying or renting a DVD, compared with just 50% for the population as a whole, while 25% bought or rented a Blu-ray Disc, versus 5% overall.

"While many in the home video industry worry that digital consumers might walk away from packaged media, that hasn't happened yet," said Russ Crupnick, entertainment industry analyst for NPD. "Discs are still and by far the dominant way Americans enjoy home video."

He noted that "consumers engaging with digital video today also tend to be heavy consumers of DVDs and Blu-ray Disc."

The NPD study was conducted online and is based on more than 11,000 completed responses from U.S. consumers.