Friday 6 May 2016 6:37 am

Netflix and kill: Digital movie sales overtake DVDs for the first time

It's official: the DVD is dead.

Ok, not quite yet, but we're about to pass a milestone that puts ye olde digital versatile disc firmly in the rear view mirror as the world drives towards a future filled with film streaming.

Call it the Netflix effect, but consumers in Britain will spend more of their cash on streaming and downloading films and TV shows this year than they will on buying or renting DVDs for the first time in history.

An astonishing £1.31bn will be spent on the former this year, rocketing 23 per cent on 2015, and with a 16 per cent decline in DVD and Blu-ray sales to just £956m – the first time its dipped under the £1bn mark –  it puts the likes of Netflix, Amazon Prime, and iTunes in the lead.

Read more: SoundCloud: Music streaming isn't "winners take all" market

Streaming now accounts for one in every three pounds spent on "home video", a market worth £2.27bn in total, according to the new figures from Strategy Analytics.

By 2020 the firm predicts streaming will account for more than half of all home movie watching, rental downloads 18 per cent and bought downloads 17 per cent, leaving bought DVDs accounting for just 13. That compares to just five years ago when DVDs held a 75 per cent share and streaming a mere three per cent, and 40 per cent versus 33 per cent today.

“Five years ago, DVDs represented 86 per cent of consumer spend on home video, in five years it will be less than 14 per cent, with DVD/Blu-ray rental virtually extinct,” said the firm's digital media director Michael Goodman.

“As online provides increasing ways to access films and boxsets, physical simply can’t compete. Although many people will always prefer a physical disc, retailers will have to decide whether it’s even viable to offer that format in five years’ time. Many won’t and with less high street players around, it will be online, ironically, that keeps DVDs on life support via e-commerce.”

Read more: Music streaming is No 1 in the US – but vinyl's on the up

The demise of the DVD follows the same sorry trend as CDs. Sales of digital music overtook physical formats across the world earlier this year. However, the DVD could go one of two ways – the way of VHS, mini-discs and cassettes, or vinyl, which has experienced a recent triumphant resurgence. But for now, the DVDs days are numbered.

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