Lockdowns may have got us spending more time in front of the television but it won’t help the ailing physical video market. Instead, consumers are switching even faster to streaming sites, with Netflix, and Disney+ among those that are winning subscribers at a rapid rate.
Streaming has been a significant disruptor in the video market, with the likes of Netflix and Amazon Prime enticing consumers to invest in their services at the detriment of physical DVD and Blu-ray sales. The Covid-19 pandemic is set to exasperate this market even further as not only is there a major new entrant to streaming but also with more people spending time at home, investment in these subscription services appears more worthwhile as consumers are able to use them more regularly to supplement the reduction in new TV content being produced. Indeed, on 21 April, Netflix announced that it was also seeing higher uptake of its service as a result of global lockdown measures, adding 16 million new paid subscribers globally in the first three months of 2020, over double the seven million it had expected.
Disney+ launched in several European countries in March as many of these countries entered lockdowns with a target of 50 million global subscribers; it reached this target five months after its initial launch in the US in November 2019, an achievement that took Netflix seven years to accomplish. It is clear streaming services are becoming integral to consumers’ lives and the numerous lockdowns across the world are encouraging consumers to spend more time in front of the TV or on a laptop. This will have a detrimental impact on the sales of DVDs for retailers not only during the lockdown but after as well, as consumers are tied to these subscriptions and have less of a reason to purchase a physical film.
The woes of the video market are heightened by a number of key film releases being delayed. The latest James Bond instalment has seen its cinematic release date postponed until November, ensuring its DVD release date will not happen until 2021. Previous instalments in this series have offered a boost in retail sales and while they will instead be felt in 2021, for retailers already in trouble, with no notable releases this year, 2021 may be too far away.