It’s Official: The DVD Business Died in 2024
Somewhere at a CVS Pharmacy or 7-Eleven likely near you, there’s a broken and pillaged Redbox machine, abandoned by its makers and wasting away like Ozymandias in the desert.
It’s a perfect visual summary of the current state of the DVD industry, once a titan of the home entertainment world, reduced to a shadow of its former self in the streaming era.
Around this time last year, VIP+ predicted 2024 would be the year the DVD became a sub-billion-dollar business in the U.S. And now, with the recent release of Digital Entertainment Group’s 2024 year-end “Digital Media Entertainment Report,” the data confirms just that: After years of decline, the DVD market has hit bottom.
Physical disc sales in the U.S., now categorized as “physical product” by DEG, declined 23% from 2023’s $1.3 billion, to $959.6 million this past year. That’s a 94.2% decrease from DVD sales’ all-time high of $16.6 billion in 2006 — a drop that started in 2008, about a year after Netflix launched its streaming platform.
Conversely, total domestic home entertainment spending reached an all-time high of $57 billion in 2024 (up 21% YoY), meaning physical product accounted for just 1.6% of that tally.
That shrinkage was partly due to DEG no longer tracking physical rental spend as of 2024. To phase out the category, the company combined disc rentals and sales into the “physical product” metric for 2023, as consumer spending on physical rentals declined by more than 50% from 2022.
As such, DEG’s 2023 annual report didn’t officially disclose the split between physical rentals and sales within physical product. But given that the metric only included sales in 2024, YoY comparisons and some simple math reveal that physical rentals made a little over $300 million in the final year of reporting — a 39% decrease since 2022 and a roughly 95% decrease since 2011.
It’s possible that, had physical rentals remained included, the DVD industry would have crossed the 10-figure mark for at least one more year. But even then, it’s unlikely the extension would’ve lasted for much longer. Netflix ended its once-flagship rental mailing service, and Redbox shut down just within the past year, so DEG’s justification of the physical rental market simply becoming too small to even bother tracking made unfortunate sense.
Concurrently, major retailers including Best Buy, Target and Walmart have either dialed back or discontinued DVD and Blu-ray sales, so the idea that physical product may be axed altogether in the near future isn’t a stretch.
SVOD, meanwhile, logged another year of exponential spending growth, increasing 25% from 2023 to hit $52.2 billion in 2024. The gap between SVOD and total home entertainment spending is slimmer than ever, as the former jumped from accounting for around 80% of the total in 2023 to 91.3% this past year.
Without SVOD, however, the home entertainment industry’s trajectory over the past decade or so looks decidedly less prosperous: Total home entertainment across all spending streams but SVOD — physical product, electronic sell-thru (EST) and VOD — fell just below $5 billion in 2024, down 9.6% from the previous year.
The 2024 results continue the trend of non-SVOD home spending decreasing every year since at least 2011. In fact, the non-SVOD total for 2024 is down 63% from the nearly $14 billion a decade prior, when SVOD accounted for less than a quarter of total spending.
Looking at individual spending streams confirms SVOD is the only category that has seen upward growth over the past 13 years — a 5,154% increase, to be exact. EST and VOD have fared better than physical product, in that spending for both has stayed mostly flat but both are currently trending downward as of 2024 (-10.6% and -2.8% YoY, respectively).
The main takeaway from these numbers is the same one VIP+ noted last year but with extra urgency: Relying this heavily on a single income source is a dangerous game for any industry, let alone when that source is the famously volatile streaming market. SVOD’s spending growth won’t last forever, especially as subscription prices continue to increase and consumers turn to cost-effective options such as FAST and AVOD.
As for the DVD, its time as a major industry player may be over, but its vinyl-like rebirth into a specialty item and status symbol for the dedicated is already underway.
Toward the bottom of its report, DEG notes that sales from physical 4K UHD catalog releases held steady since 2023, while spending on titles released with “premium steelbook packaging” grew in 2024. No specific percentages or dollar totals were included, but it leaves a small glimmer of hope for the holdouts who still champion physical media in an increasingly digital and subscription-based world.
It’s a perfect visual summary of the current state of the DVD industry, once a titan of the home entertainment world, reduced to a shadow of its former self in the streaming era.
Around this time last year, VIP+ predicted 2024 would be the year the DVD became a sub-billion-dollar business in the U.S. And now, with the recent release of Digital Entertainment Group’s 2024 year-end “Digital Media Entertainment Report,” the data confirms just that: After years of decline, the DVD market has hit bottom.
Physical disc sales in the U.S., now categorized as “physical product” by DEG, declined 23% from 2023’s $1.3 billion, to $959.6 million this past year. That’s a 94.2% decrease from DVD sales’ all-time high of $16.6 billion in 2006 — a drop that started in 2008, about a year after Netflix launched its streaming platform.
Conversely, total domestic home entertainment spending reached an all-time high of $57 billion in 2024 (up 21% YoY), meaning physical product accounted for just 1.6% of that tally.
That shrinkage was partly due to DEG no longer tracking physical rental spend as of 2024. To phase out the category, the company combined disc rentals and sales into the “physical product” metric for 2023, as consumer spending on physical rentals declined by more than 50% from 2022.
As such, DEG’s 2023 annual report didn’t officially disclose the split between physical rentals and sales within physical product. But given that the metric only included sales in 2024, YoY comparisons and some simple math reveal that physical rentals made a little over $300 million in the final year of reporting — a 39% decrease since 2022 and a roughly 95% decrease since 2011.
It’s possible that, had physical rentals remained included, the DVD industry would have crossed the 10-figure mark for at least one more year. But even then, it’s unlikely the extension would’ve lasted for much longer. Netflix ended its once-flagship rental mailing service, and Redbox shut down just within the past year, so DEG’s justification of the physical rental market simply becoming too small to even bother tracking made unfortunate sense.
Concurrently, major retailers including Best Buy, Target and Walmart have either dialed back or discontinued DVD and Blu-ray sales, so the idea that physical product may be axed altogether in the near future isn’t a stretch.
SVOD, meanwhile, logged another year of exponential spending growth, increasing 25% from 2023 to hit $52.2 billion in 2024. The gap between SVOD and total home entertainment spending is slimmer than ever, as the former jumped from accounting for around 80% of the total in 2023 to 91.3% this past year.
Without SVOD, however, the home entertainment industry’s trajectory over the past decade or so looks decidedly less prosperous: Total home entertainment across all spending streams but SVOD — physical product, electronic sell-thru (EST) and VOD — fell just below $5 billion in 2024, down 9.6% from the previous year.
The 2024 results continue the trend of non-SVOD home spending decreasing every year since at least 2011. In fact, the non-SVOD total for 2024 is down 63% from the nearly $14 billion a decade prior, when SVOD accounted for less than a quarter of total spending.
Looking at individual spending streams confirms SVOD is the only category that has seen upward growth over the past 13 years — a 5,154% increase, to be exact. EST and VOD have fared better than physical product, in that spending for both has stayed mostly flat but both are currently trending downward as of 2024 (-10.6% and -2.8% YoY, respectively).
The main takeaway from these numbers is the same one VIP+ noted last year but with extra urgency: Relying this heavily on a single income source is a dangerous game for any industry, let alone when that source is the famously volatile streaming market. SVOD’s spending growth won’t last forever, especially as subscription prices continue to increase and consumers turn to cost-effective options such as FAST and AVOD.
As for the DVD, its time as a major industry player may be over, but its vinyl-like rebirth into a specialty item and status symbol for the dedicated is already underway.
Toward the bottom of its report, DEG notes that sales from physical 4K UHD catalog releases held steady since 2023, while spending on titles released with “premium steelbook packaging” grew in 2024. No specific percentages or dollar totals were included, but it leaves a small glimmer of hope for the holdouts who still champion physical media in an increasingly digital and subscription-based world.