Blu-ray: Still Alive as Disc Sales Soar

So Blu-ray is on life support? A terminal case, soon to be replaced by streaming services such as Netflix? Not so fast, says the Digital Entertainment Group (DEG), a studio-funded trade group based in Los Angeles.

In fact, Blu-ray disc sales in the U.S. soared 58 percent in the third quarter of 2011 compared to the same period last year, according to DEG's newly released Home Entertainment Report.

The home entertainment business also appears to be rising out of its Great Recession slump, albeit slowly.

Consumer spending on home entertainment in Q3 rose nearly 5 percent compared to a year earlier, the first increase since the first quarter of 2008 when the recession got underway, the DEG study says.

Bye-Bye Blockbuster

Blockbuster's demise is evident in the DEG data as well. Brick-and-mortar disc rentals in Q3 plummeted nearly 29 percent year over year.

Kiosk rentals, meanwhile, showed a dramatic 23 percent rise in Q3 year over year, a strong indication that disc rental machines from Redbox and other providers are a big hit with consumers.

The number of U.S. homes with Blu-ray players, including Sony PS3s, home theater-in-a-box systems (HTiBs), and BD set-tops, now stands at 33.5 million--a year-over-year increase of 52 percent. Plummeting prices of Blu-ray players, which now sell for under $100, played a role here, no doubt.

Overall, the DEG report shows impressive gains for Blu-ray, which nevertheless will lose the format war to streaming services over time. For now, however, there's some life left in the business of delivering video entertainment on shiny discs.

Contact Jeff Bertolucci at Today@PCWorld, Twitter (@jbertolucci) or jbertolucci.blogspot.com.

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