The wholesale DVD market has been a huge casualty of growing interest in VOD and streaming OTT services, losing nearly half of its value in 2010 according to SNL Kagan.
In its ‘The Economics of TV and Film’ report, SNL Kagan calculate that wholesale DVD revenue plummeted by 43.9% from $7.97 billion in 2009 to $4.47 billion in 2010. On average film titles shipped 545,000 units, making $10.8 million in wholesale revenue, a whopping 52.4% down on the 2009 average of $22.6 million.
These figures were actually given a huge boost by the release of Avatar. The analyst stressed that these figures do not include Blu-ray revenue, which grew significantly in 2010.
Yet even though VOD and OTT services offer much more cost-effective way of coming to market and are in increasing use, in what is a double whammy for content owners, the revenue from such services is nowhere near enough to offset the drop in DVD sale revenue, which has been a prime source of revenue for almost a decade.
The survey found that the average wholesale price was relatively flat when compared with 2009, but there were significantly fewer units shipped, down 43.8% to nearly 226.0 million.
In terms of individual companies, SNL Kagan identified Fox as market leader in terms of market share, thanks mainly to the release of Avatar alone shipping over 10.3 million units and making $207.5 million in revenue approximately 34.5% of Fox's total wholesale revenue of $605.9 million from 30.1 million DVDs shipped.
Not far behind was Warner with $605.7 million, for a 13.5% market share from 24 titles shipping 31.2 million units. Again just closely behind, Buena Vista banked $600.6 million from 29.8 million units shipped. Some way down the list was Columbia, 10.1% share from $453.3 million, and Universal, 9.9% share from $443.5 million.
Out of the general DVD train wreck were a few successes. In addition to the aforementioned Avatar, Toy Story 3 gained $201.8 million from more than 10.0 million units shipped and Twilight: New Moon and Twilight: Eclipse had a lot of market bite with $174.8 million and $160.7 million respectively.