September 24, 2004, 12:00 AM

History repeats itself: Movie downloading mirrors early music downloading

The movie downloading market is where the music downloading market was a few years ago. Downloads are a fraction of the market (0.3%) that is dominated by young men (80% of downloaders are male), says a new report on the industry from the NPD Group.

Kurt Peters

Executive Editor

The movie downloading market is where the music downloading market was a few years ago: A fraction of the market (0.3% of all movie purchases or rentals were downloads) dominated by young men (80% of movie downloaders are male), says a new report on the industry from the NPD Group, provider of sales and marketing research in a number of vertical markets.

"Looking at digital movie rentals so far this year, we`re encountering definite echoes of early consumer patterns seen in the music industry," said Russ Crupnick, president of NPD Music and Movies. "When digital music first became popular, the overwhelming majority of consumers were male; however, over time increasing numbers of women began acquiring digital music. Now that digital music has become more mainstream, women are responsible for purchasing nearly half of paid music downloads. We can expect to see a similar rise among women in the digital movie rental market."

18- to 24-year-olds accounted for 26% of all download rentals for January through June 2004, NPD reports. This age group is only 16% of all video/DVD buyers or renters. Just over half of those downloading movie rentals were younger than 35, while over 80% were younger than 45.

NPD data show that digital music customers tend to be heavier buyers of music CDs, and that pattern is echoed in digital movie rentals. Consumers paying to rent digital movies from the web are twice as likely to be heavy movie buyers (i.e., they purchased seven or more movies in the past three months) relative to consumers who acquire movies though pay-per-view or video-on-demand. In addition, 34% reported being heavy renters (i.e., they rented seven or more movies in the past three months), which is significantly higher than those who used PPV or VOD.

In Q2 2004 Movielink, a broadband VOD service, owned the largest share of the digital movie rental market with a 33% unit share, followed by MovieFlix with 13%, NPD reports. Compared to the average mix of genres that are rented or purchased, these consumers were much more likely to obtain videos from the Science Fiction/Fantasy genre. The most popular videos downloaded during Q2 were "Independence Day," "Matrix Revolutions," "Matchstick Men," "Harry Potter and the Sorcerers Stone" and "Star Trek Wrath of Khan."

NPD`s VideoWatch collects video acquisition information on a continuous basis from members of NPD`s consumer panel of more than 2.5 million registered members. Detailed purchase information is collected from an average of 3,000 video buyers and renters each week.

 

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