Los Angeles (CA) - High-definition video saw substantial growth in 2007, but it will take four more years until consumers will spend more money on Blu-ray discs than on DVDs, the Entertainment Merchants Association (EMA) concluded in its 2007 Annual Report. In 2007, high-definition video sales accounted for only 1.6% of all video sales.

According to the EMA, nearly nine million high-definition discs were sold in 2007, for which consumers spent more than $260 million. Total home video generated $15.9 billion in sales and $8.2 billion in rentals during the year.

The number-one DVD seller in 2007 was Happy Feet, The Departed led the rental charts, High School Musical 2 was the best selling TV on DVD title, and 300 was the leading high-definition disc movie, the organization said. There were 12,177 DVDs released in 2007, down from a peak of 13,950 in 2005.

It is still estimated that high-definition has a long way to go until it will replace the DVD as the mainstream movie format. The EMA said that sales of Blu-ray discs are expected to exceed those of standard DVDs in 2012 and will generate sales of $9.5 billion. By that time, total home video spending will be up to $25.6 billion, the organization believes.

In the rental business, online rental businesses such as Netflix and Blockbuster Total Access captured 25% of the market, while traditional rental stores accounted for 73% of the rentals. Kiosk rentals doubled their market share to 2%.

Most movie studios agree that Blu-ray will see a slower than expected expansion this year. While HD DVD is gone and player prices are beginning to drop, cheap upconverting DVD players are believed to be holding back Blu-ray player sales: It is estimated that about 3.5 million upconverting DVD players were sold in 2007 versus just 500,000 Blu-ray players (excluding Playstation 3). At the recent Home Entertainment Summit, studio representatives said that total Blu-ray sales will be approaching about $1 billion in 2008.

Source : Tom's Hardware US