Home Entertainment Spending Fell 9% In Q1 Not Including Streaming Services

Depending on how you look at it, home entertainment spending was either stable — or seriously declined — in Q1 based on data out today from the Digital Entertainment Group.

The industry organization says that consumers spent $4.55 billion in the period, down just 1.8% from early 2015. In addition to being “in line with the same period 2015,” DEG lauds the number for “outpacing the box office value on video release by nearly 10 percentage points.”

But that folds in spending on fast-growing subscription streaming services including Netflix that some analysts say doesn’t belong in the tally. They’re more like premium channels such as HBO than the traditional business of selling and renting individual movies, those who believe this say.

Subscription streaming was up 19.0% to $1.41 billion — making the first time in a Q1 that spending on the services exceeded all sales of packaged goods including DVD and Blu-ray discs.

If you take out streaming services, then home video spending declined 9% to $3.14 billion.

All sales and rental categories for physical media fell by double digit percentages. Packaged good sales dropped 13.2% to $1.38 billion. Redbox and other kiosk rentals fell 20% to $409.5 million. Subscription DVD rentals, for example from Netflix, declined 16.4% to $147.7 million. And brick and mortar store rentals slipped 17.0% to $140.2 million.

That more than outweighed the digital gains. Video on demand was up 7.3% to $561.5 million and electronic sell through rose 4.4% to $505.0 million.

DEG says the electronic sell through sales slowed “due to a smaller slate of new releases,” although it “continues to see robust catalog growth.”

In addition to the sales numbers, the group says that retailers sold more than 1.5 million 4K Ultra HD TV sets in the quarter, up 210%. That brings the total to more than 7 million.

This article was printed from https://deadline.com/2016/04/home-entertainment-spending-down-q1-deg-1201746768/