Erik Gruenwedel, Media Play News
News that Best Buy would discontinue selling packaged media movies on DVD and 4K UHD Blu-ray Disc in 2024 made headlines this week, despite the fact the consumer electronics retail giant foreshadowed the move almost 12 years ago.
Under then new French CEO Hubert Joly, the retailer drastically transitioned shelf space devoted to DVDs to less costly standalone point-of-purchase displays, arguing the consumer was embracing streaming video and other digital distribution channels.
And as media companies embraced SVOD, and later ad-supported VOD, in an attempt to bridge the Grand Canyon-sized market gap to Netflix, packaged media has increasingly been given the cold shoulder. When Netflix formally closed the door on its legacy by-mail DVD rental business on Sept. 29, it was little surprise that big box retailers such as Best Buy would follow.
The higher cost associated with packaged media purchases compared with digital should hardly have made much difference to consumers, according to current Best Buy CEO Corie Barry.
Barry contends U.S. consumers have embraced the “funflation” economy, a term used to explain consumers choosing to spend big on fun items such as luxury travel and Taylor Swift The Eras Tour concert tickets, which average more than $800 a piece, regardless of price or impact on household discretionary spending.
“The bigger ticket items in electronics are not right now where people are interested,” Barry told attendees at last week’s Fortune’s Most Powerful Women Summit in Dana Point, Calif.
Barry contends that innovation continues to redefine the consumer electronics market. So too could the argument be made that the technology that once championed the DVD (and Blu-ray Disc) on the home entertainment market, has now moved past packaged media.
“So yes, right now people are pulling back [on consumer electronics spending], but the future will only be more enabled by technology, and we are the ones that know how to commercialize that new tech better than anyone,” she said.
Which apparently doesn’t won’t include packaged media anymore.