The Third Quarter 2021 Home Entertainment Report from The Digital Entertainment Group (DEG) shows that consumers in the U.S. spent nearly $8 billion on at-home entertainment, an approximate 9.5% increase over the same period in 2020. A year and a half following the beginning of the pandemic, this was a record-breaking period for home viewing.
The U.S. home entertainment business grew to $796 billion, with SVOD spending accounting for the majority of the increase. Spending on subscription streaming services had a significant jump. Overall, the digital entertainment business increased by 11.7%.
In retrospect, packaged DVDs, Blu-ray sales, and electronic-sell-through of digital are down from 2020. For instance, sales and rental of physical discs fell 11% from last year, which explains why Redbox is pivoting so hard to streaming. Even with pandemic conditions improving and theatrical releases picking up, DEG expects spending on home purchases to continue in a positive direction. With Disney+ and HBO Max pursuing same-day releases, new viewers will continue subscribing to such services.
Altogether, U.S. consumer spending across digital and physical home entertainment formats in the first nine months of 2021 was $23.6 billion, a more than 6% increase from the $22.2 billion in the same period a year earlier.
Since Q3 2020, new subscription streaming platforms have been added to the market, such as Discovery+ and Paramount+. Audiences have also grown significantly for many services like HBO Max, Apple TV+, and Netflix.
There are plenty of other studies that show this growth in SVOD spending. Like the Hub Entertainment Research study that shows how two-thirds of subscribers plan to continue watching new releases from home. 36% of consumers plan to watch new releases in theatres. Furthermore, a report from Digital TV Research predicts that from 2021 to 2026, the percentage of TV households subscribed to one or more SVOD platforms will spike from 82% (99 million) to 87% (106 million).
All this data confirms the trend: SVOD is the future of at-home entertainment.