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Streaming Now Accounts for 84% of Consumer Home Entertainment Spending, DEG Says

Consumer spending on home entertainment once again rose sharply in the third quarter of 2022, according to estimates released Nov. 11 by DEG: The Digital Entertainment Group.

But the gains, as usual, were lopsidedly from the subscription streaming sector, while transactional revenues — physical and digital combined — were down.

Of the total estimated consumer spend of $9.1 billion in the three-month period that ended Sept. 30 — a figure that’s up a healthy 13.1% from the third quarter of last year — nearly $7.7 billion, or just over 84%, came from streaming subscriptions. SVOD spending rose 17.3% in the quarter and is up 17.5% for the nine months through Sept. 30 at $22.3 billion. Total consumer home entertainment spending for the first nine months of the calendar year is up 12.2% to an estimated $27 billion, the DEG says.

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Transactional revenues fell slightly less than 5% in the quarter to an estimated $1.45 billion. Disc sales and rentals were down 14% to an estimated $497.5 million, while digital sales and rentals were slightly up, at an estimated $956 million from $946.5 million in the third quarter of 2021. Digital sales, or electronic sellthrough, posted a 9.5% gain in the third quarter to $611 million, while video-on-demand rental revenue was down more than 11% to $345 million.

For the first nine months of the year, transactional revenues — physical and digital combined — were down nearly 8% to an estimated $4.7 billion. Disc sales and rentals slipped 15% to an estimated $1.6 billion, while digital sellthrough and VOD revenues fell less than 3% to $3.16 billion. Digital sales for the year, as of Sept. 30, were up 5.2% to an estimated $1.85 billion, while digital rentals were down 12.5% to $1.3 billion.

The DEG notes that digital purchases of theatrical titles rose more than 27% in the third quarter and 21% in the first nine months of the year. Growth was fueled by a combination of a 25% spike in the number of theatrical releases and more favorable windows for transactional. The box office value of films released simultaneously to streaming services and the transactional market fell during the third quarter to 19%, from 32% in the third quarter of 2021, the DEG says.

In the one bright spot for physical media, the DEG estimates that consumer spending on 4K UHD Blu-ray titles was up 33% in both the quarter and the nine-month period, led by Sony Pictures’ Spider-Man: No Way Home.

One thought on “Streaming Now Accounts for 84% of Consumer Home Entertainment Spending, DEG Says”

  1. I wonder how RedBox is still around?
    I mean with all the Streaming stuff out now.
    But then all kinds of people still want the disc in hand.
    Like I do. Keep it going RedBox.

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