Strategy Analytics: DVD Player Shipments To Hit 22 Million Units This Year

Revenue Growth Of 220 percent Expected, Say Analysts

3-Aug-00

Manufacturers will increase worldwide shipments of set-top DVD players by 300 percent this year, according to the latest research from Strategy Analytics. Despite rapidly falling prices, retail revenues across the three major regions (U.S., Europe, Japan) will rise by 220 percent to $7 billion. This year's market is being driven by the launch of DVD-based games consoles, and DVD recorders will fuel the momentum from 2001 onwards.These conclusions are presented in a study entitled ""World DVD Planning Report"" and published recently by Strategy Analytics within its strategic advisory service, The Interactive Home.The report also concludes that DVD will become the standard home video format within five years, largely replacing VHS cassettes. DVD-Video disc shipments this year will reach nearly 400 million units, and continue to soar to 2.3 billion by 2005, worth $44 billion. Including other DVD formats (games, DVD-ROM, DVD-Audio), shipments will reach 3.7 billion by 2005, worth nearly $100 billion.The report shows that rising hardware sales are being offset by falling prices. The average price of a DVD player in 2001 will fall to $200 in the U.S. and $270 in Europe. Chinese-sourced players in particular are having a noticeable impact. ""The content industry will ultimately benefit the most from DVD's success,"" says Nick Griffiths, Senior Analyst with Strategy Analytics. ""Manufacturers will continue to suffer from falling prices and declining margins, but DVD's superiority will tempt many consumers to buy more video and to replace their existing VHS collections.""Overall consumer sales of DVD devices (set-top, PC, other) will reach 46 million units this year, including 21 million in the U.S. and 17 million in Europe. Basic DVD players will account for two-thirds of set-top shipments in 2000, the remainder being DVD games consoles. The U.S. leads the way, with expected sales of 9.0 million players, followed by Europe, with 4.9 million.By the end of 2000, 14 percent of U.S. and 5 percent of European homes will own at least one TV-based DVD player. In addition, many homes are acquiring DVD-capable PCs, so that overall household access to DVD is 25 percent in the U.S. and 14 percent in Europe. Strategy Analytics provides information and insights which help competitors develop strategies in consumer electronics and media, mobile and fixed communications, personal computing, automotive multimedia and enabling technology business. For more information, visit www.strategyanalytics.com.

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