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DVDs Not DOA Just Yet! Expect One For Christmas

Tuesday, 4 Dec 2007 | 5:13 PM ET
DVD's for sale
DVD's for sale

Everyone's been talking about how DVDs are dying, and that nobody's buying the archaic discs. But guess what, you'll probably get a whole bunch as gifts this year. There were more DVDs sold this Thanksgiving than any previous year, up 6 percent from the same weekend in 2007.

Now, it's important to point out, that at the same time, the overall retail revenues from DVDs has fallen thanks to the big box retailers' deep discounting.

So here's the deal. DVD sales were about $16 billion last year, and through last month, that number was down about 4 percent this year. But since those are total retail sales, and not the revenues to the movie studios, which get paid a wholesale fee per DVD, this could be a decent year for 5-10 percent growth for the media companies' DVD divisions.

Today, Sony came out with "Superbad," with many different versions, unrated etc. And the head of Sony's Home Entertainment division says that its box set of the three Spiderman movies on Blu-ray discs has been so popular, retailers haven't been able to keep it on shelves. These kind of sales are expected to grow Sony's home entertainment group 5-9 percent in the fourth quarter. Other hot products this year--Paramount/DreamWorks "Transformers" and Disney's "Ratatouille."

The big DVD trend this year--TV shows. You'll see huge, heavy, and expensive packages of every single "Seinfeld" episode. (Trust me, this thing weighs a ton), plus "Beverly Hills 90210," "Melrose Place," and every other TV show you can imagine. Also, special edition boxes. Disney's got a new special edition "Peter Pan," or others are releasing classics in fancy new boxes. Like Stephen Spielberg's "Close Encounters."

Let's face it, all the DVD growth is coming from high definition. But the battle between Blu-ray and HD DVD has slowed that growth. The industry is hoping that this holiday shopping season will yield a winner, and that will get more people buying high def.

DVD Sales Up
With China toy recalls, problems with the Xbox, and no new scripted content on TV, DVDs may be bigger than ever this holiday shopping season. CNBC's Julia Boorstin has the details.

One thing's for sure: those early adopters, the first ones to buy high def players, are first to invest in those classic box sets. Think how many high def DVDs would be flying off shelves if one of those two formats would just emerge triumphant and the other would just go the way of the Beta!

Questions? Comments? MediaMoney@cnbc.com

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  • Working from Los Angeles, Boorstin is CNBC's media and entertainment reporter and editor of CNBC.com's Media Money section.