Internet now accounts for 90% of entertainment sales Digital video the biggest winner in 2019, PS4 games the biggest loser Physical sales still amounted to £1.4bn in 2019

Friday 6 March 2020: Sales of video, music and games grew by 2.4% in 2019 to reach a new all-time record of £7.8bn in their seventh successive year of growth, according to official figures revealed in the Entertainment Retailers Association (ERA) Yearbook, published today (March 6).


Yet again the driver of growth was the increasing popularity of digital streaming with digital now accounting for a record 81.8% of the overall entertainment market. Less than a decade ago, it was physical formats which accounted for 80% of revenue.


Fastest-growing sector was video - up 9.5% in value to £2.61bn. Key factor was an astonishing 21.5% increase in digital video revenues to £2.1bn, driven overwhelmingly by subscription video services such as Netflix and Amazon Prime. Nearly 50% of the population (49.9%) subscribe to streaming video services which now account for exactly two-thirds (66%) of the video market.


Video’s streaming success was mirrored in the music market with total revenues up 7.1% to £1.4bn, driven by an even more astonishing 23.5% increase in music streaming revenues to just over £1bn. In contrast digital gaming faltered for the first time in 2019 with growth of just 1.1%, but at £3.17bn, the value of the digital gaming market is still almost as large as digital video and digital games put together.


 Internet now accounts for 90% of entertainment sales


Streaming and downloads are not the only way the internet has transformed the entertainment industry. Include internet-ordered physical entertainment formats through online stores such as Amazon and the internet now accounts for 89.8% of entertainment revenues.


“This is extraordinary,” said ERA CEO Kim Bayley. “The internet now accounts for 90p in every pound spent on entertainment. It is quite simply the most dramatic revolution in entertainment retailing ever seen.”









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Digital video the biggest winner, PS4 the biggest loser in 2019


Detailed analysis of entertainment formats shows that digital video was the fastest growing segment in 2019, up £372.9m on 2018’s sales, while PS4 games were the biggest loser as we near the end of the current console cycle, down £119m on the previous year.


Confirming the general market trend, three of the four biggest winners were all digital, the biggest losers all physical.



Entertainment formats 2019 v 2018




Increase in sales


Decrease in sales

Digital video


PS4 games


Music streaming




Nintendo Switch games


Xbox One games


Digital games




Source: ERA Yearbook





Physical dominates the hits business, offers choice and convenience



Despite pressure on physical format sales, yet again in 2019 many of the biggest hits of the year owe their success to physical and almost all titles at the top of the charts sold better on physical rather than digital formats. The top-selling video of the year, Bohemian Rhapsody, sold 67.2% of its 1.7m sales total on physical formats including 941,166 DVD units. The top-selling videogame, FIFA 20, sold 64.5% of its 2.25m units on physical.


Key to physical’s continuing appeal is the sheer number of physical sales outlets and the greater availability of titles on physical rather than digital formats.


While the number of physical outlets selling entertainment declined in all categories in 2019, there were still 10,001 physical outlets selling video, 8,450 selling music and 5,544 selling videogames.


When it comes to availability of product there were 521,029 albums available to download but 606,906 titles on CD. In video there were just 9,460 titles available for download, but 122,659 available on DVD.


ERA-commissioned research points to the growing importance of the over-45s to sales of physical formats with 55.3% of physical video sales and 62.8% of physical music sales accounted for by the older age groups.


Said Bayley, “Physical entertainment still amounted to a £1.4bn market in 2019. It is certainly down, but it is far bigger than many appreciate and still offers benefits in terms of gifting, collectability and permanence which streaming cannot match.”


Key beneficiaries of the continuing demand for physical music formats – particularly vinyl – are indie record shops. In 2019 the number of indie stores remained at a 10-year-high of 425. Independents were the only physical music store category not to see a decline in numbers in 2019.


Said Bayley, “While much of music spending has moved online, independents with a distinctive, locally-tailored offering continue to flourish.”


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