This report provides definitive statistics and commentary on the current state of the European home video market, together with detailed forecasts for over 20 countries through to 2007. In 2002, consumer spending on DVD in Western Europe overtook consumer spending on VHS for the first time. In just five years DVD has not only come to dominate the video sector but also stimulated a return to exponential growth. But what do the next few years hold?

The report assesses the size, structure and future prospects of the European home video industry based on Screen Digest's analysis of the latest market data and our own revised and updated computer model.

Current and historic data in this report is the result of the long-standing co-operation between Screen Digest and the International Video Federation (IVF), the only international professional video organisation.

Screen Digest's detailed forecasts for every aspect of the home video sector (VHS, and DVD, rental and retail, trade and consumer level) build on this data to provide an invaluable reference source for anyone involved in the video.

KEY POINTS

• Despite the growth in alternative entertainment options, the home entertainment business has gone from strength to strength in recent years and is now worth Euro 13bn annually in software sales alone, thanks primarily to the launch of DVD.

• Barely five years after its official European launch, the digital format dominates the video sector. Europeans have been spending more on buying and renting DVD than VHS since 2002; by the end of 2007 discs will account for 93% of spending.

• Plummeting DVD hardware prices have helped boost take-up of the new format beyond all expectations; in 2003 the number of Western European homes with a DVD player rose from less than 30m to over 50m.

• By 2007 67% of Western European homes are expected to have a DVD player - a penetration rate it took the VCR almost 20 years to achieve!

• Europeans already spend more on buying and renting DVDs than they do on going to the cinema or buying video games.

• And DVD has affected the way people choose to watch films; homes with a DVD player buy far more discs than they ever did VHS cassettes.

• The format has also affected the very structure of the video business; European video distributors have been forced to reassess business models and release strategies in the face of changing consumer behaviour.