M+E Daily

DEG at CES: Blu-ray, Digital Distribution Bolstered Home Entertainment in 2010

Blu-ray software sales rose by 68% in 2010, helping to offset slackening demand for DVDs in the home entertainment market, according to year-end figures released by DEG: The Digital Entertainment Group.

The DEG, which announced the year-end data at the International Consumer Electronics Show (CES) in Las Vegas, said that consumers purchased $1.8 billion worth of Blu-ray discs in 2010. Blu-ray rentals, meanwhile, topped $500 million, with rentals from brick-and-mortar outlets up 34% over 2009.

Blu-ray devices – including set-top players and videogame consoles – have sold through more than 28.5 million units since the format’s launch in 2007. Some six million devices sold in the fourth quarter of 2010 alone, bringing total units sold during the year 11.25 million, according to numbers compiled by the DEG with input from retail tracking sources.

Digital distribution also contributed materially to the home entertainment sector in 2010, edging Blu-ray in overall annual value.

Consumer spending on broadband electronic sell-through (EST) and video on demand (VOD) up a combined 19% to $2.5 billion. VOD brought in $1.8 billion, up 21% for the year, while EST grew 16% to $683 million.

The trade group estimates that VOD transactions offset the decline of the entire rental category. Without VOD, rentals would have been down by 2% for the year; with VOD, the category is up by 2% to $7.8 billion. (The DEG bases its 2010 rental estimates on input from multiple studios and restated 2009 figures from Rentrak.)

Overall, consumer transactions for prerecorded content grew by 1% during the year — “a clear indication that consumer demand for home entertainment remains healthy,” said Warner Home Video president Ron Sanders, who serves as the DEG’s president.

The overall combined value of the rental and sell-through businesses during 2010 was $18.8 billion, a 3% decline from 2009. DVD sales and rentals slipped 11% in value year-over-year, ending 2010 at $14 billion.