As the new Ultra HD Blu-ray players were announced last fall, I found myself breathing a sigh of relief. Physical media is going to live to see another day, I thought. It’s all in the bag for at least a few more years.
Or is it?
We’ve known for quite some time that the physical media sphere has been shrinking, and each time more evidence bubbles to the surface I cringe. I am, you see, a total home theater snob when it comes to movie content, stuck in a world where Blu-ray rules all. On the most basic of levels, I like being able to see and hold something that I own. And on the most complex of levels, I want a source that delivers optimal levels of video and sound with every film I throw its way.
Score two for Blu-ray.
The latest and greatest version of Blu-ray players began rolling out earlier this year with the market introduction of Samsung’s UBD-K8500 4K machine. Philips is gearing-up to deliver one of its own, soon, and rumor has it that other companies – including Oppo – will follow suit in 2016. But what does this really mean? Will Ultra HD Blu-ray explode onto the scene and cause consumers to demand content, or is it simply a stopgap as the industry shifts to 4K media servers and streaming services?
If I had to bet my money, it would be on the latter.
I live in a densely populated region smack-dab in the middle of the Washington-Baltimore metro area. Like the rest of the country, we’ve watched Hollywood Video and Blockbuster literally bite the dust. Next came Blockbuster’s online and kiosk forays, both of which barely existed, and the inevitable shrinkage of movie sections in large stores such as Target and Best Buy. A mainstay, however, for quite a bit of time has been Redbox.
Redbox is simple. You can find the company’s self-serve kiosks outside of convenience stores and double stacked inside of grocery stores nearly everywhere you go. They hardly ever have lines and renting a movie is ridiculously cheap. And while Redbox doesn’t have every new film at release, it has enough to make it an excellent source for renting movies. As it turns out, it’s also an excellent source for taking a pulse of what consumers truly want.
Recently, DigitalSmiths released 2015 data illustrating consumer content consumption, and the results sent a shiver down my Blu-ray spine. It shows that Redbox’s percentage of the consumer’s video consumption market is shrinking right along with the glaciers gracing the glorious terrains of North America’s mountainous lands. At the beginning of 2015, Redbox held a healthy 18.5-percent share of the video market. In fact, Redbox represented the largest single source of any part of the rental segment (which, aside from Redbox, is practically composed of online/streaming options). Turn the page to Quarter 4 and Redbox’s market share had fallen nearly 5-percent to a smidgen over 13-percent.
That’s a fairly steep decline in a rather short period of time.
The year-to-year revenue numbers aren’t any better. Last month, Outerwall (Redbox’s parent company) posted Redbox revenues of $407 million during Quarter 4 of 2015, which was down nearly 24-percent from the year before ($490.7 million). From a pure rental perspective, the numbers look like this: Q4 2015: 135.8 million rentals, Q4 2014: 179.5 million rentals.
Obviously, if you’re a disc lover like me, these numbers aren't what you want to see. In fact, they’re downright depressing. Perhaps they are more indicative of the rental market as a whole, but I have a sneaking suspicion that they truly represent something much larger. If Redbox’s much publisized interest in taking a second stab at the streaming market is any indication, then outlook for disc-based media isn’t good.
This brings me to a question for you, kind readers. How do you consume your media? Do you have a preference? Are you amendable to a shift to downloadable/streaming media? Are you already practically 100% streaming? I’m curious to see where HTS members fall on this issue.
Image Credit: Redbox