German DVD revenues fall 4%

Sales break 100 million, but price dip nixes gain

By ERIK KIRSCHBAUM

BERLIN — DVD sales in Germany topped 100 million for the first time in 2006, but revenues fell 4%, prompting Constantin topper Fred Kogel to lash out at distribs for dumping prices and warning that there will be a further slide in 2007.

"There are some distributors selling films dirt cheap on DVD," Kogel told the Handelsblatt business daily after the GfK market research institute reported that revenues fell to e1.73 billion ($2.28 billion) in 2006 from $2.37 billion in 2005 even though unit sales rose to 101 million from 98.7 million in 2005. "The fall in prices will continue," Kogel said.

The average price for a DVD fell by 4% last year, from $17.60 to $16.90, according to GfK research for home entertainment industry group Bundesverbande Audiovisuelle Medien (BVV).

"The aggressive pricing strategy for new material is aggravating," said Oliver Trettin, BVV managing director.

Top sellers last year were "Harry Potter and the Goblet of Fire," "Ice Age 2: The Meltdown" and "Pirates of the Caribbean: Dead Man's Chest."

Homevid rentals fell once again in 2006, down 11% to $374 million on 112 million rentals, hurt in part by the World Cup in Germany as well as a long, hot summer that dampened demand.

On the bright side, BVV said, the home entertainment sector had overall revenues of $2.09 billion in 2006, almost double the $1.07 billion collected at the cinema box office.