10 Aug DEG Mid-Year Report: Spending Up 5% to $15.7 Billion in 2021 First Half Amid Challenging Pandemic Comparisons
August 10, 2021 | Consumers spent $15.7 billion on movies and television shows consumed at home and on the go in the first six months of 2021. For the full first half, spending rose 5 percent from the $14.9 billion consumers spent in the first six months of 2020, which was a record-breaking period for home viewing as consumers limited out-of-home activity in response to the spread of the novel coronavirus. Second quarter growth year-over-year was 1 percent, for a total of $7.9 billion.
During DEG’s Expo today, Redhill Group President Judith McCourt (top l.) discussed the factors limiting 2021 growth with DEG Chair Jim Wuthrich (bottom), President of Home Entertainment and Content Licensing for WarnerMedia, and DEG Board Director Michael Bonner (top r.), President of NBCUniversal’s Universal Pictures Home Entertainment. Primary among those, all agreed, is a dearth of theatrical new releases, which are historically a key driver of home entertainment spending. Due to theater closures during the COVID-19 pandemic, few new releases made their way to market in the first half of the year, and those that did were often released initially for rental or sale in a premium window, the spending on which was not reported by any major studio in the first six months of 2021.
“We had this big spike last year where consumers were looking for any content they could transactionally,” Wuthrich added. “This year we’ve come down, but we’re running against that big spike we had last year.”
“The one drag that we’ve got for the first half of this year was really around new release product because we don’t have a lot of new release product,” Wuthrich said.
When compared against the comparable pre-pandemic period in 2019, however, total U.S. home entertainment spending in 2021 shows growth of more than 35 percent for the second quarter and 32 percent for the first half, demonstrating consumers’ continued strong engagement with content. Internet-delivered video-on-demand (VOD**) rentals grew 24 percent in the first half of 2021, compared to the same period in 2019.
Both Wuthrich and Bonner characterized the first half of 2021 as positive, noting that when compared to pre-pandemic 2019, transactional has grown its appeal, especially with catalog. “We have evidence that the consumer adoption and engagement during the pandemic is up overall, and those levels are kind of maintaining,” Bonner said. He also estimated that premium windows are capturing another $1 billion that studios are not yet reporting through industry channels such as DEG.