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UltraViolet May Not be the Savior Studios Need, Says Analyst

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While studios are banking on UltraViolet bringing consumers back into purchasing mode, at least one analyst isn’t so sure.

Morgan Stanley analyst Benjamin Swinburne released a report today that is sure to have a lot of Hollywood executives crying themselves to sleep this evening.  By his estimates, home video operations at  Disney, Fox, Paramount, Universal and Warner Brothers have dropped in value from $40.2 billion in 2007 to $19.3 billion now.  Mr. Swinburne attributes this 52 percent drop to the fact that the average TV household was worth $127 in video profits to the studios in 2007, but he estimates that amount has now fallen to $100 last year, and will be down to $93 by 2015.

As for the UltraViolet initiative that the studios are  currently putting a big push behind, Swinburne isn’t too upbeat on it doing much to save the dropping numbers.  With Redbox rentals being a $1.20 a night, and a Netflix streaming account costing $8 a month, he suspects that consumers are going to find less and less need to purchase films in any format.

While Blu-ray is still growing, it is not climbing at anywhere near the rate DVD sales are falling.  It is definitely beginning to look like the days of purchasing movies as opposed to renting or streaming are coming into their twilight years.

[via Deadline]


Sean P. Aune

Sean P. Aune has been a professional technology blogger since July 2007, but his love of tech dates back to at least 1976 when his parents bought...

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