If you are one of the few (American) people who chose not to see Star Wars: The Force Awakens in theaters, you're in luck: Yesterday, the highest-grossing release in domestic box-office history hit DVD, Blu-ray, and streaming video, allowing you to watch in the comfort of your own home and away from anyone dressed as Chewbacca. But we live in an era when the idea of tangible movies is fast becoming quaint, or at least relegated to the collectors' market, while the mainstream is moving to subscription services and on-demand digital rentals. So what are the expectations for the DVD and Blu-ray unveiling of the box-office champ? And what even counts as a sales success for a physical release when you can watch movies on your phone?
To find out, we called up Bruce Nash of Nash Information Services, which runs entertainment-industry data site the Numbers. According to him, the U.S. physical home-media market peaked in 2005 and 2006 at about $22 billion a year. After that it crashed, owing to a combination of the recession and the emergence of digital platforms.
"In the fourth quarter of 2007, there were about 670 million DVDs and Blu-rays sold. By the fourth quarter of 2009, there were about 413 million units sold," Nash says. "In the span of two years, you saw a complete collapse in the DVD and Blu-ray market."
That dip was partially offset, however, by rentals and purchases on services like iTunes, where the margins are actually better than with DVD or Blu-ray, since digital platforms reduce production and distribution costs. In 2010 the domestic home-media market leveled off at about $18 billion per year in spending, where it's essentially remained since, with a steady increase in the amount spent on streaming video and decrease in disc purchases.
Into this market walks The Force Awakens, the championship belt around its waist. What can it expect?
"The traditional milestone for the home-release hall of fame is about 20 million physical units total," Nash says. "At the peak of VHS you would sell 20 million VHS units, and at the peak of DVD you would sell 20 million DVD units. Now, a combination of DVD and Blu-ray might take you to 20 million. Frozen, the biggest movie of the last couple years, is just over 20 million now. Cars is at 23 million, The Dark Knight is at 22 million, Avatar is at 19 million. It's harder to do that than it used to be, but it's still achievable."
Nash added that mid-level hits have seen the most attrition in disc sales, but people still buy the biggest releases. That said, it's unlikely that The Force Awakens will even approach the heights of the historical top-sellers, those movies that moved 25 million units across all formats: The Lion King, Shrek Toy Story, Finding Nemo, Titanic, Shrek 2, and Pirates of the Caribbean: The Curse of the Black Pearl.
The movies that still tend to dominate on physical home video generally fall into one of two categories: either animated movies like Frozen or Cars that parents can use to anesthetize their children, or rewatchable action movies like The Dark Knight and the Pirates of the Caribbean series that tend to play well with teens on up. Franchises predictably also do well, including Harry Potter and Twilight.
For Disney, a first week of about 5 million units would be an impressive performance for The Force Awakens, which obviously checks many of the aforementioned boxes. But as with Jurassic World, which is at 6 million units sold so far, it's likely that streaming purchases will heavily cannibalize DVD and Blu-ray sales. Again, that isn't necessarily a bad thing, since the margins on streaming are better. It just reflects the way these releases have changed in recent years.
Over the next few years, Nash expects the obvious — that the market will continue to shift in the direction of streaming video. But physical copies will still have a niche, appealing to collectors who prize the tangibility of a library, hardcore fans in it for the extras and commentary, or people who value the disc's ease of use. Plus, fans will always need something to impulse-buy while in the check-out line at CVS. The Adam Sandler Collection can't hog all that action.