Report: SVoD drives record US digital spend

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Consumer spending on home entertainment rose 8.4 per cent to a record $25.2 billion (€22.6bn) in 2019, spurred by the at-home sector’s biggest growth engine, digital, according to DEG: The Digital Entertainment Group.

Subscription streaming, digital movie sales and digital movie rentals over the Internet all generated significantly more money than they did in 2018. DEG estimates consumers spent $15.9 billion on subscription streaming, which now accounts for 63 per cent of the entire home entertainment market – a 23.7 per cent spike from 2018.

Digital movie sales were up 5.1 per cent to nearly $2.6 billion — while digital movie rentals, through Internet services such as FandangoNow, Redbox On Demand, Vudu and Google Play, were up 9 per cent. This reflects “consumers’ continued engagement with VoD, increasingly through Internet services,” DEG reported.

Consumers spent a total of $5.9 billion on buying movies and other filmed content, either on Blu-ray Disc, DVD, 4K or digital – down 9.4 per cent from 2018. Disc sales declined 18.2 per cent to $3.29 billion.

Rental spending dropped 12.3 per cent in 2019 to $3.4 billion. On the digital side, à la carte streaming generated $1.96 billion, down 6.2 per cent from the prior year – mainly due to consumers’ shift away from traditional pay-TV services. Disc rentals, meanwhile, slipped 19.5 per cent to $1.44 billion, the biggest chunk of which came from kiosks, which finished the year with estimated sales of $884.6 million. Redbox leads the kiosk market, with more than 40,000 red vending machines, generally situated at large grocers and mass merchants such as Walmart.

Also on the rental side, Netflix’s legacy disc-by-mail rental business brought in an estimated $301.2 million, while the country’s waning number of video rental stores — once the home entertainment sector’s dominant revenue producer — collected just $250 million, a 21.1 per cent decline from 2018.

On the transactional side, the top-performing movies included Disney’s Avengers: Endgame and Captain Marvel, Warner Bros.’ Aquaman and A Star is Born, and 20th Century Fox’s Bohemian Rhapsody. TV standouts included Yellowstone, Game of Thrones, The Walking Dead and The Big Bang Theory.


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