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Blu-ray Sales Get Busy and UltraViolet Expands

The Digital Entertainment Group (DEG) published its Mid-Year 2012 Home Entertainment Report.

For more information visit: www.degonline.org


Unedited press release follows:

Overall Consumer Spending Rises 1% in 2012 First Half
Industry Stability Bolstered by 13% Lift in Blu-ray Disc Sales
Digital Distribution Surges With Electronic Sell-Through’s 22% Jump
and VOD’s 12% Rise Underscoring UltraViolet Expansion, EST Availability

July 29, 2012 — Led by a surge in digital distribution and continuing double-digit increases in Blu-ray Disc sales, the home entertainment sector further stabilized in the first half of 2012, experiencing a 1.43 percent increase in consumer spending compared to the first half of 2011.

In addition to the continued growth of Blu-ray, the industry experienced remarkable jumps in digital distribution revenue in the first six months of the year, driven by electronic sell-through (EST). The growth of EST is especially noteworthy now as it underscores the expansion of the UltraViolet cloud-based system introduced to consumers last year, which allows people to watch movies they own anytime, anywhere on a variety of devices. It also reflects strong consumer response to the increased availability of EST.

Among the trends in the first half of the year:

• Blu-ray Disc sales continued to grow steadily at double-digital rates with consumer spending for the first half up 13.3 percent compared to the same period last year.

• Catalog product on Blu-ray Disc continued its strong growth, increasing 26 percent during the same period, which further cements the notion that Blu-ray has become the standard in home entertainment.

• Digital distribution provided additional growth in the first half of the year due to a greater consumer response to EST, which led to a 21.86 percent increase in EST consumer spending compared to mid-year 2011, and a 27 percent increase in the second quarter compared to Q2 2011. Additionally, VOD was up 11.6 percent compared to the mid-year 2011, with a 17.2 percent increase in the second quarter compared to Q2 2011, showing increasing consumer demand resulting from wider access and improved ease of use.

• UltraViolet recently surpassed 4 million household accounts. The continuous growth of UltraViolet underscores that consumers are responding favorably to the increased availability of EST, as well as the growing range of UltraViolet services.

• The number of Blu-ray homes continued to rise, with 1.4 million Blu-ray Disc players (inclusive of BD set-tops, PS3s and HTiBs,) sold in the second quarter, bringing the total household penetration of all Blu-ray compatible devices to more than 42.1 million U.S. homes.

• Further, more than 4.6 million HDTVs were sold to U.S. consumers in second quarter 2012; HDTV penetration to date is nearly 80 million U.S. households.

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