The Motion Pictures Association’s latest Theme report has highlighted strong growth in the home entertainment market amid a decline in the theatrical segment of the market that began with the onset of COVID-19.
Last year, the home entertainment sector accounted for 79% of all revenues in a global video entertainment market that was worth almost $100 billion.
The MPA’s data shows that the video entertainment market bounced back from a decline in 2020 to achieve record-breaking revenues. During the interim period, the theatrical market was decimated while home entertainment sales expanded rapidly, driven primarily by the growth of video streaming services.
It was only in 2016 that the theatrical market was bigger than the home entertainment market in terms of global revenue. Just six years ago, it seemed unimaginable that we would soon be seeing the latest blockbuster movies premiere on what were then still fairly nascent streaming services. It was only in 2015 that Netflix released its first ever original movie, Beasts of No Nation.
"In 2021, the digital market accounted for 72 percent of the combined theatrical and home/mobile entertainment market, down from 75 percent in 2020,” the MPA said in its 2022 Theme report. “The theatrical market (21%) and the physical market (7%) made up the rest.”
In 2021, like in the previous year, many movie theatres and cinemas across the world were forced to close for weeks or even months at a time due to coronavirus control regulations. The industry suffered as a result.
However, even as cinemas and theatres have began reopening, video streaming services are enjoying rapid growth, what with the rising popularity of Netflix alternatives such as Amazon Prime Video, Disney+, Apple TV+ and HBO Max, to name just a few.
At the same time, sales of DVDs and Blu-ray discs have also suffered. The global market for physical disks has fallen from $20 billion in 2015 to just $6.5 billion in 2021.
Despite the ructions facing the global video market, the MPA said it is optimistic for the future, whatever that may hold. When including Pay TV services such as cable, satellite, terrestrial and IP, the global video entertainment market was worth almost $330 billion in 2021.
“Over the last two years, the pandemic has impacted almost every aspect of our daily lives, generating new and unexpected challenges,” said MPA Chairman and CEO Charles H. Rivkin. “The film, television, and streaming industry has not been immune, and in many ways, we are still navigating this new reality. But, as the Motion Picture Association commemorates our 100th anniversary this year, I have a renewed sense of optimism. In short, 2021 marked the onset of our industry’s rapid rebound."
