A DVD for Every Home?

The recently released "World DVD Planning Report" is predicting that US sales of DVD software this year will reach 57 million discs (worth $1.5 billion), and that by 2005 more than 1.3 billion discs will be shipped annually (worth $36 billion). Annual sales of DVD players are predicted to reach 9.1 million units in 1999, a growth rate of 128%, and will continue to soar, reaching 52 million by 2005. More forecasts: Video titles currently account for over 90% of the software market, but by 2005 their share will have fallen to 43%, while DVD-ROM will account for 28% and games formats 24%.

David Mercer, Senior Analyst with Strategy Analytics, authors of the report, says that "DVD is set to become the dominant packaged media platform for the next decade. DVD players will be everywhere, and discs will be even more pervasive than CDs are today." The report points out that TV-based DVD-Video players are becoming the format of choice for movie fans and videophiles, and that DVD is also expected to become a standard feature of home PC systems within the next year or so. New games consoles from Nintendo and Sony will also be DVD-based, DVD-Audio will soon be launched for the hi-fi market, and DVD-Video recorders are around the corner.

The report predicts that 11% of US homes will own at least one DVD device by the end of 1999, and 58% by 2002. DVD PCs currently account for 75% of the installed base, but this share will fall to 59% by 2002 as TV-based DVD becomes more widespread. "In spite of the relatively low penetration (4%) of DVD-Video players (90% of households own a VCR), the shift from VHS to DVD software will happen quite rapidly, since early DVD owners are the avid movie and video enthusiasts who account for a major share of pre-recorded video sales and rentals."