LOS ANGELES—A new report from the Hollywood studios-backed Digital Entertainment Group (DEG) shows that hefty spending on streaming helped boost overall consumer spending on movies and television shows consumed at home and on the go to $10.7 billion in the third quarter of 2023. 

For Q3 2023, spending rose 16.8% from the almost $9.2 billion consumers spent in the same quarter of 2022, driven by the continued growth of SVOD, as well as theatrical franchise titles offered for digital purchase in premium and traditional windows.

DEG reported that Q3 2023 saw a 20.7% increase in subscription streaming, which rose to $9.3 billion, from $7.7 billion in the third quarter of 2022, as targeted and general entertainment services continued to add subscribers with new content, pricing options and ad-supported tiers. Some services will have raised prices more than once in 2023. For the year to date, consumer spending growth also hovers at 20%, the group said. 

For the first nine months of 2023, overall spending on movies and television shows consumed at home and on the go topped $31 billion. The year-to-date 17.7% growth across all digitally delivered formats—electronic sell-through (EST), video on demand (VOD) and subscription streaming—was driven by 20% growth in subscription streaming and smaller gains in transactional formats. Physical formats 4 continued to decline, with digital formats accounting for more than 96% of total consumer spending, the group said. 

DEG highlighted several other trends for Q3 and the first nine months of 2023:

• Consumer spending on digital purchases (EST) in premium and standard windows continued to grow in the third quarter of 2023, with purchases rising 9% in the period. The effect of theatrical new releases was strong: EST purchases of theatrical titles grew 13% in the quarter. Theatrical new releases are historically a key driver of home entertainment spending. Because of this, announced delays in upcoming theatrical releases due to the Hollywood strikes may have an adverse impact in the next few quarters.
• TV purchases, meanwhile, fell 15%, with the genre already experiencing a negative effect from the Hollywood strikes. With new episodes of scripted series delayed pending the resolution of the actors’ and writers’ strikes, there was little to create excitement around the TV genre.
• Digital rentals (VOD) rose almost 3% in the third quarter, reflective of continued cord-cutting and changing consumer behavior: Internet-delivered rentals were up 11% while cable/satellite rentals fell by more than a third.
• From a transactional slate standpoint, the quarter started strong with early releases and first-half holdovers including The Flash (WBD); Fast X (Universal); Guardians of the Galaxy Vol. 3 (Disney); Super Mario Bros. Movie (Universal); and Transformers: Rise of the Beasts (Paramount). Titles that added energy in September included Barbie (WBD) and TMNT: Mutant Mayhem (Paramount). Other quarterly top-performers across transactional formats included John Wick: Chapter 4 (Lionsgate); Joyride (Lionsgate); The Little Mermaid (Disney); No Hard Feelings (Sony); and Spider-Man: Across the Spider- Verse (Sony).
• 4K UHD Blu-ray was the only segment of the physical disc business to experience growth, with spending up almost 6%. New Release continues to be a key driver of 4K UHD Blu-ray success, with the quarter’s top titles being Spider-Man: Across the Spider-Verse (Sony) and Guardians of the Galaxy Vol. 3 (Disney) both of which saw more than 25% of sales come from the format. Overall, consumer spending on physical product rentals and purchases declined 25% for the third quarter and 27% year-over- year.
• Ad-supported premium AVOD and FAST content reached an estimated advertising revenue of $4.5 billion in the third quarter of 2023, according to estimates from Omdia5, as more major streamers diversified their offerings to include lower cost subscription plans with ads. Omdia estimates show ad revenue grew 20% in the quarter.

 LOS ANGELES—Despite wide-spread fears of an imminent streaming slowdown and shakeout that have hammered stocks of major streamers and media companies over the last year, new data from the Digital Entertainment Group shows that consumers continue to embrace the medium in record numbers, with consumer spending on subscription streaming video services rising by $7.9 billion in Q4 2022 and full year SVOD spending jumping by 17% to $30 billion. 

Ad-supported AVOD and FAST channels also saw record revenues, hitting $16.8 billion in 2022, up 40% from 2021, according to data from Omdia cited by DEG. 

 The data suggests that the U.S. market for streaming isn’t headed for a recession anytime soon and that the market continues to see relatively impressive growth compared to the overall economy. 

Overall U.S. consumer spending across digital and physical home entertainment formats in 2022 was more than $36.5 billion, an 11.4 percent increase from the almost $33 billion consumers spent in 2021, driven by a raft of strong franchise properties coming from theaters and television.

Consumers spent $34.5 billion on digital entertainment purchases (EST2), rentals (VOD2) and subscriptions for the full year, a jump of 14 percent over full year 2021. Spending on subscription streaming rose more than more than 17 percent for full year 2022, topping $30 billion.

In the year’s final quarter, overall consumer spending rose 8.3 percent, representing just over $9.5 billion, even though box-office spending on the titles released to the home in the fourth quarter fell almost 25 percent from the year earlier period. New theatrical releases are historically a key driver of home entertainment spending. Consumers spent almost $9 billion on digital entertainment purchases (EST), rentals (VOD) and subscriptions in the fourth quarter of 2022, an increase of 11.5 percent.

Other highlights for Q4 2022 and the full year included: 

• Digital purchases (EST) were up 2 percent for the year, with spending on theatrical content up 11 percent and spending on TV content down 13 percent, DEG reported. 
• After strong gains in the first three quarters of the year, digital purchases (EST) of theatrical content were down 16 percent in the fourth quarter. This was due to smaller box office titles released, including less favorable home entertainment genres like horror and comedy.
• The surge in theatrical new releases in the first three quarters also benefited premium physical formats, with spending on 4K UHD Blu-ray titles ending the year with 20 percent growth. The most in-demand 4K UHD titles of 2022 reflect many of the year’s biggest titles overall, including “The Batman, Doctor Strange in the Multiverse of Madness”, “Jurassic World: Dominion”, “Spider- Man: No Way Home” and “Top Gun: Maverick”.
• Digital purchases (EST) of TV product experienced declines of 12.8 percent for the full year, but only 2.2 percent in the fourth quarter, which was driven by strong demand for the most recent season of the megahit series "Yellowstone", along with previous seasons and the spinoff "1883".
• U.S. consumer spending on subscription streaming rose to $7.9 billion in Q4 2022, with growth slowing slightly to 15.4 percent. Spending on subscription streaming for the full year was $30 billion, an increase of more than 17 percent.
• In parallel, ad-supported premium AVOD and FAST content reached an estimated advertising revenue of $16.8 billion in 2022 according to estimates from Omdia4, as more major streamers diversified their offerings to include lower cost subscription plans with ads. Omdia estimates show ad revenue grew by more than 40 percent for the full year, DEG reported. 

LOS ANGELES—Amidst the ongoing pandemic, consumers are continuing to shell out for SVOD subscriptions, which made up the majority of U.S. home entertainment spending in the third quarter of 2020, according to a new report from the Digital Entertainment Group (DEG).

Of the more than $7 billion that consumers spent on home entertainment in Q3 2020, SVOD subscriptions (i.e. Disney+, Netflix, HBO Max, Peacock and others) accounted for $5.515 billion. The quarterly spending on SVOD was an increase of 38.7% from Q3 2019.

However, electronic sell-through—the purchasing of content from platforms like Amazon, Vudu or others—was down in Q3. DEG reports a dip of nearly 14% from 2019, bringing in just over $600 million. In addition, VOD rentals only saw a minimal growth of 2.56% year-over-year, earning just over $459 million.

Still, in the first nine months of 2020, spending on all digital formats (SVOD, digital purchases and VOD rentals) totaled nearly $20 billion, a 34% increase over the same time period in 2019.

Year-to-date, the overall spending on home entertainment in the U.S. has surpassed $22.19 billion, 23.29% more than 2019 at this point.

For more information, visit www.degonline.com.  

LOS ANGELES—There’s no place like home; based on the Digital Entertainment Group’s Home Entertainment Report for 2016, consumers are finding some more truth to that statement. DEG’s annual year-end report saw an increase in home entertainment spending, including a strong showing for 4KTVs, players and discs in what the company says was its first year of launch.

The report found that roughly 10 million 4K/UHD TVs shipped in 2016 and expects that number to increase to 30 million by the end of 2017. 4KTV makes up about 16 million of the 112 million households for HD/UHD penetration. In addition, UHD Blu-ray players and 4K disc content also saw strong showings; approximately 300,000 Blu-ray players shipped, per CTA, while 4K discs on TV shows and movies outpaced HD discs in its first year of release. Those numbers can be expected to increase going forward, as more titles are available in 4K/UHD; 110 are currently available, the report says, with a projected 250 available in 2017.

In total, DEG reports that U.S. home entertainment exceeded $18 billion in 2016. Overall electronic sell-through spending rose 5 percent; theatrical content grew 17 percent year-over-year. After a dip in 2015, video-on-demand saw an increase over the past year of 6 percent, totaling $2.1 billion. Subscription VOD was up 26 percent in the fourth quarter compared to 2015, 22 percent for the full year.

To read the full report, click here.