More and more consumers are moving on from physical discs to streaming and digital, according to new figures from DEG (Digital Entertainment Group) that imply sales of the former fell substantially last year. Sales of UHD Blu-ray discs were up 15% in the fourth quarter thanks to releases that include Christopher Nolan’s Oppenheimer, however.
Physical sales:
- YTD 2022: $2,085.22
- YTD 2023: $1,557.28
- Difference: -25.23%
2023 year-end home entertainment spending, including digital:
January/February 4K UHD releases include:
- The Raid: Redemption
- Lone Star
- Conan the Barbarian
- Conan the Destroyer
- Silent Night
- The Marvels
- Darkman
- Leviathan
- Contagion
DEG notes:
- U.S. consumer spending on subscription streaming rose above $10.1 billion in fourth quarter 2023, with robust growth of almost 25 percent.
- Consumer spending on digital purchases (EST) in premium and standard windows continued to grow in the fourth quarter, with purchases rising 7 percent overall and more than 30 percent for theatrical titles, driven by strong home demand for some of the year’s biggest box-office performers, including Barbie, The Hunger Games: The Ballad of Songbirds and Snakes, Indiana Jones and the Dial of Destiny, Mission Impossible: Dead Reckoning Part 1, Oppenheimer, and The Super Mario Bros. Movie. Spending on digital purchases of theatrical titles was up more than 13 percent for the full year.
- The title slate also drove growth in digital rentals during the final quarter of the year, with overall consumer spending up 11.5 percent and theatrical title spending up 15 percent. Growth in digital rentals (VOD) is also reflective of continued cord-cutting and changing consumer behavior: Internet-delivered rentals were up 18 percent while cable/satellite rentals fell almost 20 percent.
- The strong quarterly performance in theatrical new releases also benefited premium physical formats, with spending on purchases of 4K UHD Blu-ray titles up 15 percent for the quarter. Fans seeking to watch Oppenheimer at home in the best picture quality possible reportedly drove retail shortages of the title.
- Spending on physical disc rental fell by more than 50 percent in the fourth quarter, following Netflix’s September exit from the physical subscription business. As a result of this physical rental sector shrinkage, DEG reports going forward in 2024 will tally only sell-through of physical disc product.
- Among the full year’s best-performing titles across all transactional formats, were Avatar: The Way of Water (Disney), Dungeons & Dragons: Honor Among Thieves (Paramount), Equalizer 3 (Sony), The Flash (WBD), Guardians of the Galaxy Vol. 3 (Disney), John Wick: Chapter 4 (Lionsgate), Meg 2: The Trench (WBD), Plane (Lionsgate), Puss in Boots: The Last Wish (Universal), Spider-Man: Across the Spider-Verse (Sony), The Super Mario Bros. Movie (Universal), and Transformers: Rise of the Beasts (Paramount).
- Ad-supported premium AVOD and FAST content reached an estimated advertising revenue of $17.2 billion in 2023 according to estimates from Omdia, as more major streamers diversified their offerings to include lower cost subscription plans with ads. Omdia estimates show ad revenue grew by more than 10 percent for the full year.