DVD market down 5.7% in 2008

January 14, 2009 With sales down for a second straight year, DVDs continue to lose their luster, while a deepening recession suggests entertainment conglomerate stocks won't shine any time soon, Sanford Bernstein analyst Michael Nathanson bemoaned in a report released Wednesday. The analyst cited data from trade group Digital Entertainment Group, which shows that U.S. consumer spending on home entertainment fell 5.7% last year to $22.4 billion, driven by a 6.3% decline in DVD sell-through. Growth in Blu-ray sales momentum "is unlikely to stem the decline in standard-def units," Nathanson concluded, before adding: "We fear that the current state of the DVD market will have negative near-term implications on media conglomerate earnings."

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