DVD: Not Dead Yet

According to market research and analysis firm In-Stat, the future of DVD looks bright despite the emergence of new digital delivery services, such as video-on-demand (VOD) and online downloading. The company's latest market-research report predicts that the worldwide value of all published DVD products will increase with a compound annual growth rate of 18.2%, from about $33 billion during 2004 to $76.5 billion by 2009.

One factor in DVD's continuing success will be point-of-sale kiosks, which will burn DVDs on command, making it possible for bookstores, airport shops, coffee sellers, convenience markets, and other retailers to sell DVDs without maintaining large inventories. These kiosks will be connected to secure digital networks that are already in place to support digital-signage applications.

Another factor is the increasing availability of professional-quality DVD-authoring tools. This will increase the market for locally produced DVDs with all kinds of content from musical groups, churches, museums, businesses, and regional video producers.

Surprisingly, the report also finds that HD DVD and Blu-ray will both enjoy success. "In North America, HD DVD will jump-start a round of growth for high-definition versions of Hollywood movies, as consumers begin replacing their libraries of old VHS tapes and DVDs," says In-Stat analyst Gerry Kaufhold. "HD DVDs will appear later this year, to take advantage of the growing installed base of HDTV sets in the US. However, we expect Blu-Ray products to take off in Asia in 2006, and in Europe and the rest of the world during 2007."

Outside of North America, In-Stat expects Blu-ray to become the dominant high-definition optical-disc format because it is backed by a majority of international consumer-electronics manufacturers. Also, it ultimately provides more storage capacity and better features.