Streaming video sales to hit $6.3 billion by 2014 as DVD market plunge continues

Ding-dong the DVD is dead. Or at least withering on the vine, says a new report from In-Stat, which predicts sales of video entertainment on the once-ubiquitous physical storage media will see double-digit retail sales declines, losing some $4.6 billion from 2009 to 2014.

Online streaming sales, from services like Netflix and its competitors, meanwhile, is expected to nearly triple over the next five years to some $6.3 billion, with VoD subscription revenue to push $3.5 billion by 2014. In-Stat says U.S, TV download revenue alone could triple between 2010 and 2014.

"Video disc rentals will continue their significant decline," says Keith Nissen, a principal analyst at In-Stat. "Netflix is already shifting its focus to online streaming, and Red Box is evaluating a similar strategy. The convenience and utility of the online offerings is simply too compelling. Online rentals permit the selection of any movie or TV program from the VOD library. Ultimately, it will be impossible for physical disc kiosks to compete with the in-home or in-store download-to-rent business model."

And, Nissen said, programmers eventually will offer a la carte rental of TV episodes, and that will impact Hulu, Netflix, and even the pay-TV industry's TV Everywhere initiatives.

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