DVD sales to soar - analysts

DVD is set for big growth, with the UK as an epicentre, a study finds.

Sales of DVD films are set to soar in the US and Europe, with DVD players becoming widespread by 2005, according to a report from analyst firm Strategy Analytics.

The report predicts worldwide shipments of DVD discs will rise from 77 million units in 1999 to over two billion by 2005. Sales of DVD players will see a worldwide growth rate of 182 percent in 1999 to reach 144 million units by 2005. Currently there are around 17 million players worldwide.

European DVD player penetration will grow from 4 percent in 1999 to 34 percent by 2002, and places the UK as one of Europe's strongest DVD markets. Seven percent of UK homes are expected to have either a DVD PC or DVD video player by the end of this year. That figure will rise to 67 percent by 2005.

Currently DVD PCs -- that is, a PC equipped with a DVD player and decoder -- account for almost 75 percent of the world DVD market, although Strategy Analytics expects to see this figure plummet as dedicated DVD players -- or TV-based DVD -- become more popular. "The reason that DVD penetration in the PC market is so high at present is that people are simply upgrading to DVD as a better CD-ROM drive," said David Mercer, Strategic Analytics senior analyst.

According to Mercer, games and consoles are the principal drivers behind the increase in TV-based DVD. "Next generation consoles from Sony and Nintendo will probably be multifunction players and this will certainly encourage TV-based DVD," he said.

DVD Video comes of age

  • Strategic Analytics predicts that by 2005 DVD video will account for 25 percent of DVD software sales in the UK, DVD-ROM for 43 percent and games software for 25 percent.

  • In the US DVD video will account for 43 percent of the market, DVD-ROM for 28 percent and games for 24 percent.

Differing attitudes to the purchase of pre-recorded films between the UK and US explain the differences in the percentages according to Mercer. "It's not down to any technical fear in the UK, rather a result of Americans being such avid movie fans. They are prepared to spend far more on pre-recorded films than Europeans," he said.

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