DVD VIDEO SOARS WITH RECORD SALES
Player Installed Base Reaches One Million Households

LAS VEGAS - January 7, 1999 - Enjoying overwhelming consumer acceptance, DVD Video experienced outstanding sales through the all-important fourth quarter. Figures compiled by the DVD Video Group announced today at CES estimate that hardware player sales sold through to consumers since the format launched have reached one million players in the U.S. This further indicates that DVD Video is the fastest growing new packaged media format in history.

According to the Consumer Electronics Manufacturers Association (CEMA), more than 1.4 million DVD Video players were shipped to retail since the format launched in spring 1997. Figures compiled by the DVD Video Group and research based on retail inventory levels point to sell through figures of nearly 80 percent or one million players.

Outlook for next year is equally promising as the format readies itself for the next level. The DVD Video Group estimates that hardware sales will double in 1999 to more than two million.

"The strong sales in 1998 point to a growing penetration level among consumers," said Paul Culberg, President of the DVD Video Group and Executive Vice President of Columbia TriStar Home Video. "We look forward to an even more rewarding year as we watch DVD Video lead the digital home entertainment trend into the millennium."

Mass Market Availability
In only its second year in the marketplace, DVD Video player prices have lowered significantly. According to Intelect ASW, the average price sold for a DVD Video player was $428 in November, down 21 percent from $542 earlier in the year. Some players and models are even available for less than $300. The lower price points helped to drive many new consumers to the market.

"With one million players in consumer homes, DVD Video has clearly become an established format," said Emiel N. Petrone, Chairman, DVD Video Group and Executive Vice President, Philips DVD Entertainment Group. "As DVD Video enters into the next level, we'll see players more broadly distributed and an expansion of applications as well."

New Revenue Source
There are now more than 40 DVD Video player models marketed under 30 different consumer electronics brands. DVD Video players are available at both mass merchants and specialty stores throughout the U.S.

The huge swell of consumer acceptance is a positive boost for retailers. DVD Video hardware represented approximately $5 billion in retail sales during 1998. This includes player units only and does not take into account affiliated hardware products or software sales or rental.

Titles Also A Big Hit
Since the format's launch, software sales have reached nearly 14.3 million units, according to figures compiled by the DVD Video Group based on reports from VideoScan, which tracks approximately 70 percent of the retail market. Disc sales are expected to dramatically increase next year. With all the major movie studios and music labels supporting the DVD Video format, there are more than 2,200 titles now available. The DVD Video Group predicts that next year about 200 titles will be released each month - more than doubling the total number of titles to 4,500 by the end of 1999. Retailers are relishing the strong surge in DVD Video growth. Consumers have voted with their wallets making DVD Video the digital home entertainment of choice.

The DVD Video Group is a Los Angeles-based, industry-funded nonprofit corporation that exists expressly to promote consumer awareness of the benefits of DVD Video and to provide updated information to the media and the retail trade about DVD Video players, movies and music videos. Regular members of the DVD Video Group are Artisan Entertainment, Buena Vista Home Entertainment, Columbia TriStar Home Video, DreamWorks Home Entertainment, Image Entertainment Inc., MGM Home Entertainment, New Line Home Video, Inc., Panasonic Consumer Electronics Company, Paramount Home Video, Philips Consumer Electronics Company, Pioneer Electronics (USA) Inc., PolyGram Video, Simitar Entertainment, Sony Electronics Inc., Sony Music/Sony Wonder, Thomson Consumer Electronics, Toshiba America Consumer Products, Inc., Twentieth Century Fox Home Entertainment, Universal Studios Home Video, Warner Home Video, and Yamaha Electronics Corporation.

Associate members are Alpha Enterprises, Americ Disc, Cinram, CMC Magnetics Corp., Crest National, Crush Digital, Digital Video Compression Center, Disc Graphics, Inc., JVC Disc America, Nimbus CD International, Inc., Panasonic Disc Services Corporation, Pioneer Video Manufacturing, Inc., Sony Disc Manufacturing, Sony Pictures DVD Center, Technicolor and Warner Media Services. Consumers can reach the DVD Video Group at (310) 967-2940 or through its web site at www.dvdvideogroup.com.

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