NPD: Physical Media Dominates Home Video Watching Habits

The NPD group released data which indicates that 78% of all home video spending goes towards DVD and Blu-ray while non-traditional methods of video delivery such as PPV and VoD only accounted for 8% of spending while rental services made up 15% which includes their online streaming offering. Overall spending for the year was down by 2% which is relatively stable and it could be that the larger falls seen in recent years have been stabilised by the huge growth that Blu-ray has shown since 2008.

"With the well publicized struggles of Blockbuster and retail video stores closing around the country, and with media attention increasingly focused on the newest digital home- video offerings, the value and importance of physical formats to the home video industry and to consumers is often overlooked," said Russ Crupnick, entertainment industry analyst for The NPD Group. "Even though DVD sales and rentals are slowing, there is no evidence that consumers are abandoning physical discs for watching movies, even as the choices for viewing are expanding."

The report added that many people have built up large collections of DVDs and Blu-rays which has dented the appetite for rental services and may have been a factor in the bankruptcy and closure of many Blockbuster stores across the USA. Added to the growing direct streaming VoD services offered by Netflix, Hulu or traditional PPV services such as the one offered on the PlayStation network and it is easy to see why Blockbuster were not going to survive for very long.

Even though physical media sales and rentals have fallen 9% year on year Crupnick notes that physical discs are going to remain a major part of the market for a long time. "We expect strong growth from many digital sectors, driven by connected devices, improving selection, and the consumer's endless quest for convenience," Crupnick said. "For now, though, physical discs continue to lead overall engagement and spending by home video viewers; and even with increasing use of VOD and other digital formats, the primacy of DVD and Blu-ray in home video will continue for the foreseeable future."