In what could be a tipping point for the video industry, new research from IHS Screen Digest has shown that transactional online movies in non-US markets is rapidly outstripping the traditional DVD retail market.

IHS Screen Digest believes that 2010 was a watershed year in many respects for transactional online movies internationally. It regards it as a year characterised by the continued expansion of key services outside of the US, tapping pent-up early adopter demand for online movies.

By way of contrast, the analyst predicts that that annual store-based rental revenue will continue their almost inexorable decline.

The research revealed for 2010 a whopping 92.9% year on year rise in total online movie revenues for international territories outside of the US to $242.6 million. The top five international countries in terms of market size – the UK, South Korea, Germany, France and Canada – accounted for just over three quarters of total revenues.

Driving growth was a combination of the continued rollout of Apple’s iTunes, which launched in six new markets, and the first full year of operation in some regions of not only iTunes but also Microsoft’s Zune Video Marketplace and the Sony PlayStation Network.

In terms of distribution platforms, digital retail, variously known as electronic sell-thru (EST), and download-to-own (DTO), constituted just over half (57.8%) of all international online movies consumer revenues in 2010, with revenues reaching $140.3 million. Internet-based video-on-demand (VOD) grew 99.6% year-on-year amounting to $102.3 million.

Looking forward to 2015, IHS Screen Digest predicts that overall the business of online movies will generate $785.8 million, with just over half (54.3%) through the electronic sell through route and 45.7% from the rapidly growing Internet-based VOD.

IHS Screen Digest sees the market expansion of Apple, Sony and Microsoft as crucial in driving online movie consumption. Most notably the market got a huge kick from the iPad explosion. The analyst expects even more growth given the new focus of Apple TV towards on-demand rental and subscription streaming, and the hugely expanded iPad footprint in non-US markets throughout 2011.