Videodrone News and Commentary: Discs Still More Popular Than Streaming

Video rental stores are still closing, disc rentals overall are falling, and streaming video is growing, but according to a study by the NPD Group (reported by, among other sources, Home Media Magazine), discs still dominate the movie rental market.

Nearly 62% of all home video film rentals in the first half of 2012 were on disc, the study found, compared to 38% through all digital rental sources (streaming subscription services like Netflix Instant and Hulu, video-on-demand services on cable and satellite dish, and other web-based streaming sources).

The study found that digital rentals increased 5% from the previous period, due largely to Netflix, which accounted for two-thirds of the digital market. On the disc side, Red Box kiosks and the Netflix rent-by-mail service dominate the rental market.

So while the streaming and VOD services are growing, they are not yet the juggernaut that we imagine them to be. In other words, the reports of the death of DVD and Blu-ray have been greatly exaggerated.

This study measures trends and broad economics and doesn't take into account sales on disc and digital downloads. Still, it is no surprise that the trends are following the same evolution of the music industry's shift in sales from physical media to digital files.

But it is also interesting that compared to music, this kind of access to movies is a relatively recent phenomenon. The first vinyl records went on sale over a century ago. CD, mp3, and other digital formats are simply new delivery systems for the same product.

By contrast, the first commercial videotapes and videodiscs arrived in the mid-1970s and video rentals started taking off a decade later. Very quickly, the video store became a part of the entertainment culture, offering an alternative to both moviegoing and watching TV. Anyone who ever stopped by a video store on a Friday night to pick up a couple of tapes anytime through the nineties will remember just how popular this option was. The DVD, introduced in the late 1990s, supplanted VHS tapes in five years or so and Blu-ray became the official high-definition alternative in 2008, after beating out HD DVD.

Streaming video and VOD are simply new channels for home viewers to get their movie fixes and they will likely become the dominant channels within a few years, at least in terms of renting or single-viewing. Convenience and price tends to trump quality when it comes to general marketplace.

But the likely inevitable end of DVD and Blu-ray as the popular format for home viewing isn't the whole story.

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