Report: VOD Will Have Little Impact on Video Rental
little to fear from video-on-demand (VOD) services, according to a report issued last month by research firm Jupiter Media Metrix, based here. The report, Jupiter's first on the topic of VOD, appeared to contradict some previous predictions about the service. VOD will take market share from pay-per-view services, with which it will be most closely aligned in consumers' minds, rather than from video rental, according to the report. "The industry heralded VOD as the entertainment technology that would unseat the VCR from the home and obliterate the video rental market -- that's unrealistic," said Lydia Loizides, senior analyst, Jupiter. "The greatest value lies in shifting the pay-per-view audience to VOD and generating incremental revenues." Jupiter predicted that the market for VOD movies would hit $641.9 million by 2006.
VHS Format Still Dominates Rental Market
ENCINO, Calif. -- Despite the year-end crush of spending on DVD sell-through titles, which is expected to continue into this year, the VHS format continued to dominate the rental market by a three-to-one ratio, according to the Video Software Dealers Association, based here. Rental customers spent $478 million on the top 200 VHS titles during the four weeks ended Dec. 2, vs. $154 million on the top 200 DVD titles, according to data from VidTrac, the VSDA's rental-revenue, data-retrieval system. "We are very excited about the infectious growth of the DVD market in our industry, but the sheer volume of VHS rentals demonstrates that the VHS format will also remain a popular source for home entertainment for years to come," said Bo Andersen, president, VSDA.
VSDA Fires Back At Lieberman In Video-Game Fracas
ENCINO, Calif. -- The Video Software Dealers Association last month sent a strongly worded letter to Sen. Joe Lieberman, D-Conn., and Sen. Herb Kohl, D-Wis., in response to their letters accusing video-game retailers of being lax in their restriction of the sale of mature-rated video games to children. "Frankly, we are mystified by your effort to portray the entire video-game retailing industry... as deficient in ratings education and enforcement," the letter stated. It went on to state that the senators' letters to Blockbuster, Hollywood Video and Movie Gallery were "unjustified" in light of those chains' education and enforcement efforts. "We have repeatedly attempted over the past 2-1/2 years to educate you and your staff about the proactive efforts of video rental stores to empower parents to control their children's access to video games and motion pictures," the letter stated.
Video, Entertainment Top Holiday Growth Categories
NEW YORK -- Music, video and home entertainment products accounted for the biggest gains among types of merchandise purchased during the recent holiday season, according to a report issued late last month by the International Council of Shopping Centers here. Sales of those types of gifts increased by 10.9% during the 32-day period from Nov. 23 through Dec. 24, vs. sales during the 31-day period between Thanksgiving and Christmas last year. The survey tracked sales in more than 4,000 specialty stores in 80 regional malls around the country. "The real story of this holiday season is the strong home and family theme that ran through consumer spending patterns, giving the home furnishings and home entertainment categories strong year-over-year sales gains," said Michael Baker, director of research, ICSC. The group reported that total sales at specialty stores increased 2.1% during the 2001 season.
