Business News Retail

Subscription services now account for quarter of entertainment retail

By | Published on Thursday 13 March 2014

ERA

Subscription streaming services accounted for a quarter of entertainment retail income last year, or so says the Entertainment Retailer’s Association, which published its annual stats pack yesterday.

The trade group includes video-on-demand platforms like Netflix, the music-streaming set ups and in-app purchases for gaming within its ‘access services’ category, which together accounted for 26% of entertainment retail income in 2013. Though that still means that nearly three-quarters of UK entertainment retail revenue stems from either ‘ownership’ digital services like the MP3 download stores or physical product sales, whether by mail order or on the high street.

And, while embracing the newcomers and subscription service players within its membership, ERA was perhaps unsurprisingly also keen to stress yesterday that some of its more traditional members were doing pretty well too, despite 2013 being a year dominated by the collapse and subsequent downsizing of HMV. Overall the number of outlets stocking music and video products was at an all-time high, ERA reckoned, and some independent retailers in particular had enjoyed a good year.

Though with 60% of monies now coming through online platforms – whether subscription, download or mail-order – the sector is definitely still in an era of flux. Said ERA chief Kim Bayley: “The fact that 60p in the entertainment pound is now spent online and 26p in the pound is for access to content rather than ownership is a testament to the huge investment and technological ingenuity of retailers in providing consumers with new ways to enjoy the music, video and games they love”.

This shift, Bayley was keen to add, is being embraced and indeed led by the entertainment retail sector itself (assuming you’re willing, as ERA is, to include the digital start-ups in that community). She went on: “The transformation of the entertainment market is often misrepresented either as some kind of force of nature beyond human control or as a far-sighted initiative of record and video and games companies. It is neither”.

She went on: “The entertainment revolution has been driven by new and existing retailers taking huge gambles and investing in technology and new delivery mechanisms. The striking thing, however, is that ten years after the launch of iTunes and then the rise of mobile entertainment, physical formats still account for a clear majority of entertainment market sales”.

So there you go. Yay entertainment retailers. And you record, video and gaming companies can shut up. You can tell us the resurgence is all your doing when you release your figures next week.



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