Like Music, Like Hollywood? DVD Sales Down 18.3% This Year

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Same s–t, different industry?

Actually, CDs are taking a break from double-digit plunges, at least for the moment. But this sounds like oh-so-many music industry reports of old, and certainly resembles the bigger picture. According to details just released by the studio-backed Digital Entertainment Group (DEG), DVDs and Blu-ray discs dropped an elephantine 18.3 percent during the first half of this year.  Overall, first-half physical sales reached $3.9 billion.

That is the total for ‘packaged goods,’ though Blu-rays actually inched upward 10 percent.  Which means, DVDs are positively hemorrhaging as consumers increasingly shift towards Netflix, VOD, and kiosk rentals.  In fact, this is the first period in which newer formats outsold physical formats, an inflection point with an extremely bittersweet asterisk.

And, here’s where the similarities get scary.  Overall spending – across all formats – dropped 5.1 percent to $8.5 billion, as digital formats failed to recapture losses from physical declines.  THAT definitely sounds familiar.

But there’s a very real argument that these are inherently different animals with somewhat different fates.  After all, listening to music is different than movie-watching, and consumers often view these formats differently.  Some of that is reflected in the data: amidst the broader sales carnage, rentals actually gained in the double-digits during the first half, significant but unfortunately not enough to push the broader picture into the black.  And Netflix has amassed nearly 25 million paying subscribers, far bigger than any comparable play in music.  That includes Spotify, right now, and quite possibly in the future.