As technology advances, the VCR and DVD market must not just remain stable, but continue to grow to maintain its hold in the industry. While retail video rentals have dropped some 10% from 2004, the introduction of online rental services poses a serious threat. In just one year (August 2004 to August 2005), Blockbuster’s online rental service has grown to 1 million subscribers. Its main online service competitor, Netflix, has 3 million subscribers.

As technology advances, the VCR and DVD market must not just remain stable, but continue to grow to maintain its hold in the industry. While retail video rentals have dropped some 10% from 2004, the introduction of online rental services poses a serious threat. In just one year (August 2004 to August 2005), Blockbuster’s online rental service has grown to 1 million subscribers. Its main online service competitor, Netflix, has 3 million subscribers.

DVD-player ownership quadrupled from 2000 to 2002 and nearly doubled in 2004. Nearly one-fifth of surveyed consumers reported having at least three DVD players per household, showing that this technology is the new standard, and many consumers want a DVD player for each television set.

Intriguing findings include:

By year-end 2004, a total of 42,500 movie titles were available in the United States.

Piracy is estimated to cost the industry $3.5 billion in sales globally each year.

Older children buy/receive/rent home video product more than younger children.

For the purposes of this report, Mintel defines the video market as the market for pre-recorded VHS video and DVD products, both rentals and purchased. Sales of pre-viewed VHS by rental shops are included, while sales of used products between consumers are not. Internet subscription services are included in this report. Sales of Universal Media Disc and mini-DVDs are not included in this report. This report also excludes blank recordable videos and DVDs, audio CDs, DVDs, and computer software. Hardware is not included in sales figures for this report.