Here’s More Proof That DVDs Are Obsolete

Every week has begun arriving with a fresh batch of statistics that reaffirms the death of the DVD. A new report from the Digital Entertainment Group says that despite consumers spending $4.5 billion on home entertainment in the first quarter this year, DVD sales declined. Overall spending increased 2.5 percent from the year-ago quarter.

The proof of the charge of online will come as welcome relief for content creators, as home entertainment spending has been on a decline. It dropped for the seventh consecutive year last year, falling 2.1 percent to $18 billion.

DEG, a trade coalition of studios and consumer electronic companies, found that online subscriptions such as Netflix (NASDAQ:NFLX) and Apple’s (NASDAQ:AAPL) iTunes helped the most as first-quarter home entertainment revenue grew five-fold to $548.6 million. Sales from film and TV shows increased by half a percent to go up to $165 million.

DVD subscription sales fell by $322.8 million in the quarter.

UltraViolet, a cloud-based licensing system that lets users download and stream content to multiple devices, also added 2 million accounts in the quarter. UltraViolet is a combined digital rights authentication partnership between some of the country’s biggest studios, including Sony Pictures (NYSE:SNE), NBCUniversal (NASDAQ:CMCSA), Fox Entertainment (NASDAQ:NWSA), Paramount (NASDAQ:VIAB), Warner Bros. (NYSE:TWX), DreamWorks Animation (NASDAQ:DWA), and Lionsgate (NYSE:LGF).

Packaged goods sales, which include both Blu-ray and DVDs, fell 0.6 percent from a year earlier to be at $2.1 billion. However, Blu-ray disc sales, led mainly by The Twilight Saga: Breaking Dawn, grew 23 percent, leaving the DVD business to show the big slump.