DEG: The Digital Entertainment Group announced it has released its first quarter 2018 home entertainment report for the United States.

For more information visit: www.degonline.org

Unedited press release follows:

DEG: The Digital Entertainment Group today released its First Quarter 2018 Home Entertainment Report compiled by DEG members, tracking sources and retail input.*

Home Entertainment Spending Jumps Nearly 9% to $5.7 Billion in 2018 First Quarter

Subscription Streaming Remains Strong; EST Rises on Strength of Theatrical Product

Emerging 4K UHD Market Surges as Sales More Than Double; Blu-ray Revenue Up

Consumers spent nearly $5.7 billion on movies and TV shows for home entertainment in the first quarter of 2018. The number, which includes subscription streaming from services that specialize in delivering films and TV shows over the internet, represents an increase of 8.7% from the $5.2 billion spent in the year earlier period. Digital sales of films were especially strong, while the market for new 4K Ultra UHD product continues to expand rapidly as more homes adopt the advanced technology through purchases of new TVs and Blu-ray players.

Among the highlights for First Quarter 2018:

•Total U.S. home entertainment spending totaled $5.7 billion in the first quarter, driven by an especially strong box office performance. Sales were 8.7% higher than the same period a year ago, which totaled $5.2 billion in spending.

•Subscription streaming climbed nearly 29% to nearly $3 billion from $2.3 billion a year earlier, according to data compiled by global information provider IHS Markit.**

•Electronic sell-through (EST) spending climbed 9% in the quarter, improving from the 2017 full year trend of +6%. Sales were led by an impressive surge in spending on theatrical content, which was up 15% from a year earlier and more than offset a slight decline in sales of TV content.

•Video on Demand (VOD) sales were down 4% for the first quarter, but improving from the 2017 calendar year trend of -7%. iVOD continues to be a bright spot among the digital rental channel, with sales improving 14% in the first quarter versus the same period a year ago.

•Spending on physical disc sales reached $1.1 billion in the first quarter – a decline of 10% from the year prior. Sales of the emerging 4K Ultra HD format drove an impressive 130% increase in the period, and accounted for nearly 12% of all Blu-ray spending.

•HDTV penetration is now at nearly than 125 million households, of which about 35 million have 4K Ultra HD TVs. Blu-ray playback devices (including all Ultra HD Blu-ray players, set-tops and game consoles) are now in nearly 100 million U.S. homes.

•Consumers now have more than 300 4K Ultra HD Blu-ray titles available for viewing on Ultra HD Blu-ray players and enabled game consoles and 438 4K Ultra HD Digital titles.

If you would like to discuss the DEG’s First Quarter 2018 Home Entertainment Report, please contact the DEG at 424-248-3809.

*These numbers are preliminary. Please contact the DEG for an updated version in early June.

** Please note, beginning with this quarter and going forward, DEG will report the SVOD figure by IHS Markit. For this report, IHS defines SVOD as subscription video on demand services specializing in movies and TV. This includes subscription revenue from a la carte services focused on delivering movies and TV shows over the open internet, excludes channels focused on other content (i.e., sports and news), and excludes traditional cable and satellite subscriptions and other channel aggregators. Data represents the U.S. only.