2015
Yearbook

Use of AHEDA Yearbook
This publication is provided by AHEDA for general guidance only anddoes not constitute the provision of tax, legal, investment or productadvice.
The information is provided “as is” with no assurance or guarantee ofcompleteness, accuracy or timeliness of the information, and, to theextent permitted by law, without warranty of any kind, express or
implied.
No part of this publication may be quoted, cited, excerpted,
reproduced, stored in a retrieval system or database, distributed ortransmitted in any form or by any means without the prior written
permission of AHEDA.
Requests should be submitted in writing to Simon Bush atsimon.bush@aheda.com.au outlining which excerpts you wish to use
and the context in which you wish to use it.

Contents
Introduction

3-4

1State of the Industry: Managing Director’s Insight

7-11

2

Market Overview

13-15

3

Australian Digital Video Market in 2015

17-41

4

Physical Retail Home Entertainment Market

43-51

5

Consumer Behaviour

53-66

6

Devices and Emerging Viewing Patterns

69-74

7

2015 Piracy Research

77-80

8

Theatrical Film Industry: 2015 Box Office

83-86

9

AHEDA Members Directory

88-89

Appendix:

2015 DVD & Blu-ray Sales Charts

Chapterby Category and Best of all Time

91-101

AUSTRALIAN HOME ENTERTAINMENT DISTRIBUTORS ASSOCIATION Yearbook 2015
1

AUSTRALIAN HOME ENTERTAINMENT DISTRIBUTORS ASSOCIATION Yearbook 20152

Introduction

Reflecting on the past year, I would categorise 2015

research shows that the rate of piracy in Australia has

as one of both great achievement as well as market

dropped by 4% to 25% of adult Australians. The sting

resilience.

in the tail, however, is that for the persistent pirates,
they are doing it more than ever. I believe the overall

I wrote in last year’s introduction to the Yearbook

decrease is due to a range of factors: arrival of SVoD

that the Government was in the process of passing

platforms, passage of site blocking legislation andlegislation to allow - through a court order – theindustry campaigns and education as well as the media

blocking of websites whose primary purpose is toaround the Dallas Buyers Club case.

infringe. These laws passed parliament last year.
Creative sectors now have a new legislative weapon to

The Yearbook data shows an incredible resilience in theforce ISPs to block piracy websites.

physical Australian home entertainment retail market.
Australian consumers made over 80 million transactions

Two cases have now been brought before the courts

creating a combined value of $1.2 billion. This is a

involving AHEDA members. Village Roadshow isfantastic result in a year in which subscription video

partnering with the Studios in one case with anotherservices arrived in force.

lodged by Foxtel. These are important test cases thatwill pave the way for future site blocking orders to move

In 2015, the physical DVD and Blu-ray retail channel

quickly through the courts.

sold over 50 million discs, for a total value of $904
million. As you will read on the chapter on physical retail

Despite the usual suspects saying it will be ineffective,

sales, the rate of decline has actually slowed from thethe facts prove otherwise. For example, research

year before – a remarkable result. The slate of amazing

by Carnegie Mellon University in 2015 shows that

titles helped and this looks set to remain for 2016 withpersistent website blocking of a number of piracy sites

another year of blockbusters to be released.

has effectively migrated pirates to legal channels.
Digital sales remain a strong area of growth for our
Other positive news from 2015 is that for the first time,industry with 2015 data showing both volume and reve

AUSTRALIAN HOME ENTERTAINMENT DISTRIBUTORS ASSOCIATION Yearbook 20153

Introduction
revenues increased by 12 per cent with consumer

blockbusters and ongoing franchises and werevenues reaching $187 million based on over 29 million

see a huge diversity of genres which provides

transactions.

something for everyone, from art house toAustralian films. Our in-home industry thrives

Continuous innovation will deliver ongoing value to theon the passion we have to own the films andsector and the consumer. MPDAA data shows that in

TV series we all love. We will see the catalogue

2015, nine out of 10 of the biggest box office films werecategory continue to decline but across the whole

released in Australia first before the US and this carries

business I think we will see some stability mainly

through to home entertainment with titles increasingly

driven by exceptional new theatrical and TV series

moving to a 90-day post theatrical window. Early digital

releases and also digital growing substantially,

EST is an emerging trend and also to hit the market indriven by demand”.

2016 will be an impressive range of ultra-high definition(UHD) titles.
An AHEDA Director puts it well: “We have another

Simon Bushreally strong year ahead. We have a stack ofCEO, AHEDA

AUSTRALIAN HOME ENTERTAINMENT DISTRIBUTORS ASSOCIATION Yearbook 20154

We have another really strong
year ahead. We have a stackof blockbusters and ongoing
franchises and we see a hugediversity of genres which
provides something foreveryone, from art houseto Australian films.

AUSTRALIAN HOME ENTERTAINMENT DISTRIBUTORS ASSOCIATION Yearbook 2015
5

e

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2015 Top

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VD + Blu-ray
0D

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e d b y v olu

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2

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AUSTRALIAN HOME ENTERTAINMENT DISTRIBUTORS ASSOCIATION Yearbook 20156

Managing Director’s Insight
The state of the Australian homeentertainment industry:
Industry leaders’ insights

with our content. It is a fast paced and evolving
market. We still have a pretty active retailcustomer base which we need to support andhelp them stay in the market.“Despite the disruption caused by Netflix, Stan and otherstreaming platforms, the physical home entertainment

The consolidation among major home entertainment

in Australia is proving remarkably resilient while digital

distributors in Australia last year was widely viewed astransactions continue to grow, albeit at a slower pace.

part of a worldwide trend in response to the decline
in the physical sector. The good news for Australian

The consensus view among the major distributors

customers and consumers is that Paramount Homeand some leading independents is that the in-home

Media Distribution’s handover of physical distribution

entertainment business overall was quite robust in

to Universal Sony Pictures Home Entertainment and2015, underpinned by a bunch of theatrical hits as well

Warner Bros Home Entertainment’s product moving to

as TV franchises including Game of Thrones, Downton

Roadshow Entertainment were completed with no loss

Abbey,  Outlander, Peppa Pig, The Walking Dead, Blackof new product or inventory.

Sails and The Big Bang Theory.
The Australian cinema industry notched an all-time

As executive observed, “The consolidation had torecord gross of A$ 1.226 billion last year, up 14%

happen and the reaction from the big retailers

on 2014, raising hopes that the momentum will besuch as JB Hi-Fi and Sanity has been very

maintained in home entertainment in 2016. The top

positive. However the closure of ABC Shops

10 films of 2015 generated a total of A$382.3 million

marks the exit of a committed DVD retailer. For

in ticket sales, led by Star Wars: The Force Awakens’

the distributors that are active in the market you

A$62.7 million, versus just A$264.4 million for priorhave companies that are aggressively marketing

year’s top 10.

and working pretty closely with the retailers.” Theloss of ABC Shops will be mitigated to an extent by

Typifying the home entertainment industry’s positive

the opening of ABC-branded sections in some Sanity

outlook, one senior executive said, “We are seeing

outlets.

more and more people buying and renting
on physical and digital. Last year we had an

The optimistic outlook for 2016 is based not just on

incredibly strong box-office, from which we are

the calibre of new releases but the wide diversity ofstill getting the benefit in home entertainment.

genres. “We have another really strong year ahead.

When you look at what is coming in 2016 fromWe have a stack of blockbusters and ongoinga home entertainment perspective there is no

franchises and we see a huge diversity of genres

reason to believe 2016 will be that much different

which provides something for everyone, from art

from 2015. Consumers remain incredibly engaged

house to Australian films. Our in-home industry

AUSTRALIAN HOME ENTERTAINMENT DISTRIBUTORS ASSOCIATION Yearbook 20157

Managing Director’s Insight
thrives on the passion we have to own the films

will be 100 days or so, depending on the optimum

we all love. We will see the catalogue category

release date for each film.  The move to more flexible

continue to decline but across the whole businessdating was hastened by most of the leading distributors

I think we will see some stability mainly driven by

in New Zealand adopting a 90-day window late last

exceptional new releases and also digital growing

year, plus a uniform desire to try to limit the opportunity

substantially, driven by demand,” one executive

for online piracy.

observed.
Agreements being negotiated between the big
Distributors generally expect the physical business toAustralian exhibitors and the major distributors follow

decline at about the same rate as last year as the majora two-year trial which saw most of the majors and one

studios and leading independents’ theatrical line-ups

independent each distributing three titles annually on

fuel demand for new releases. The number of kiosksa shorter window. More timely releases will be a plus

has continued to grow to around 1,000 outlets while

for the home entertainment consumers as street dates

the attrition rate among DVD shops has seen their total

move closer to the U.S. and they will no longer have todecline to about 600.   In an encouraging trend, somewait up to four months to legally access films.  

kiosks are showing a growing turn (transaction) rate.
Distributors say they will still choose the optimum
For independents, the mantra is “quality, not quantity,”

release date for each title, which will mean windows of

which recognises that only titles with known casts andlonger than 90 days for some films, particularly thosein popular genres are viable for home entertainmentthat are targeted at school vacations. “As an industry

release. Hence the indies are focussing on films with

we have to do what’s right for the content. As longstars, bigger budgets and production values and which

as there is no adverse impact on the theatricalthey believe will work across all media rights. Somebusiness then we should be free to do that. What

executives say they would not buy any title that would

we have seen around the world as windows havework only in physical only, or digital only.  The direct-to-

been shortened isthere has been no impact at all

video (DTV) release is becoming rarer but is still viable

on the theatrical business. I’d love to see the day

for male-skewing action and sci-fi genres and somewhen some titles should be 45 days and othersfamily titles, particularly for films that flop theatrically inshould be 200,” said one executive.

the US.

The Pricing Issue
Overhaul of Release Windows

A new price-point of $15-$16 for first-release DVDs

This year will represent a watershed for the industry as

introduced by the mass retailers as a loss-leader inthe long-entrenched 120-day interval between theatricalthe past 18 months is credited with helping to stemand home entertainment is being reduced progressively

the decline in physical sales,  which dropped by 8% toin favour of a far more flexible approach.  By mid-year,

A$904. 2 million in 2015 while volume was down 6%

many titles will retail 90 days after theatrical while somewith 50. 531 million discs sold. Paradoxically some

AUSTRALIAN HOME ENTERTAINMENT DISTRIBUTORS ASSOCIATION Yearbook 20158

Managing Director’s Insight
distributors believe the cheaper DVDs have inhibited

popular segment - despite the competition from SVOD

the growth of digital revenues which AHEDA estimatesservices -­‐ with revenues falling 8% to A$326.2 millionrose by 5.2% to a record A$178 million, based on GfK

in 2015. Catalogue and new release movies wereAustralia’s stats for the first 10 months of last year.

down 5% (A$256.8 million) and 6% (A$172.0 million)
respectively. DVD and BD catalogue sales spiked for

In an attempt to drive digital ownership, more and more

the Star Wars and Fast & Furious franchise titles.

titles are being released on early Electronic Sell Through(EST), two or three weeks before physical, without

The SVOD Impact

eroding DVD sales. “We track it carefully and we

There seems little doubt the burgeoning popularity

don’t see any correlation with physical. What youof Netflix and Stan, and to a lesser extent Presto,

are seeing is that people who would have rented

which reported a 210% leap in subscribers in the six

digitally are converting to buying the title early,”months to December 31, has contributed to a slowing

one executive noted.

of the growth rate of digital transactions. “We know
consumers are spending more time looking at

Some believe the disparity in retail prices between

content but they only have so much leisure time.

DVDs and digital EST is confusing for customers and

The launches of Netflix and Stan have probably

impeding the growth of digital. A new release title

taken some of that viewing time away fromon DVD typically sells for A$15 but costs A$19.95 or

the more transactional opportunities,” said one

A$24.95 for the digital version, although there is a much

executive.

smaller gap in wholesale prices.
Another sees Netflix’s arrival as a plus for home
Blu-ray penetration remains at 12.2%, marginally down

entertainment consumption overall, observing the media

from 12.9% in 2014, a low rate compared with many

attention generated by the US streaming giant has had

other developed markets. The stagnation is blameda positive effect on consumers’ appetite for content.

chiefly on the retail price disparity between BD and

Netflix’s arrival sparked a lot of binge viewing andDVDs.  While many consumers are prepared to pay as

searching for product. At the same time, the free-to-air

little as A$15 or A$16 for a DVD, relatively few see thebroadcasters are seeing spikes in catch-up viewing,value of forking out A$25-A$30 for the same film onlargely driven by mobile devices.

BD, especially when there is no extra content on the
BD. Distributors say the format has not been popular

While the streaming services have put a dampener

with older consumers nor well supported by some ofon digital sales of TV series there has been muchthe mass merchandisers. However BD’s percentage ofless impact on physical TV market. The general view

total sales can be as much as 40% for titles that lend

is that subscription TV has reset the bar for value

themselves to the High-Definition viewing experience.     perception. The home entertainment industry has never
put its full promotional and marketing weight behind
the transactional digital business except on a title-by-

In sell through, TV series on disc remains the most

AUSTRALIAN HOME ENTERTAINMENT DISTRIBUTORS ASSOCIATION Yearbook 20159

Managing Director’s Insighttitle basis, and even the big platforms such as iTunes,

The Flash. In January the site clocked 2.2 million visits

Google Play, Foxtel Box Office and Big Pond Movies

and among the most popular movies were Mad Max:

do not aggressively market TVOD. However someFury Road (co-produced by Village Roadshow Pictures)executives predict there will be a ramp-up of marketingand Australian comedy Oddball.

efforts this year revolving around promotions and lifecycle pricing to drive digital transaction consumption.

Village Roadshow co-chairman/co-CEO Graham
Burke said he and the studios  decided to first target  

Piracy Rate Drops But Still High

Solarmovie.ph because it is the “quintessential criminal

Australia still has among the highest rates of online filmsite” with rogue advertising that includes gambling,

and TV piracy in the world although the piracy rate fell

prostitution and party drugs.

last year, according to the Creative Content Australia,
a coalition of Australian screen organisations. The

IPAF’s research had shown 25% of Australians aged

IPAF survey showed those who have pirated were far

18-64 were illegally accessing content, down from 29%

more likely than those who have never pirated to be

the prior year. Depressingly, while the rate of persistentaware of anti-piracy initiatives including the website-

downloading or streaming dropped from 13% to 10%,

blocking legislation passed by the federal parliament

among that hardcore category 40% said they werelast September.  The industry is confident the first court

pirating more than ever.

cases seeking orders to block piracy web sites will havea deterrent effect, as happened in the 40 countries

Of those who were pirating less, 33% pointed to legal

around the world, including the UK and Singapore,

alternatives as the main reason. A high percentage waswhich enacted similar legislation.

either subscribing to Netflix or other streaming services,or taking advantage of free trials. More than half the

In February, Village Roadshow in concert with  the U.S.

respondents in the survey, conducted last Auguststudios applied to the Federal Court for an order toby research company Sycamore, were aware of therequire internet service providers (ISPs) to take down

litigation launched by the Dallas Buyers Club producers.

the web site Solarmovie.ph, which offers free streaming

Dallas Buyers Club LLC took action in the Federal Courtof thousands of films and TV shows. A week earlier the

seeking relief against 4,726 subscribers of six AustralianSingapore High Court ordered ISPs to disable the site,

ISPs whom it alleged infringed copyright in their film

finding it is flagrantly infringing intellectual property, andthrough BitTorrent. The producers subsequently

the site has previously been blocked in the UK, Italy anddropped the action.

Romania.  Solarmovie.ph boasts that it offers a total of
51,236 movies including Deadpool, Zoolander 2, Creed,

Graham Burke has foreshadowed further cases against

Dirty Grandpa, How To Be Single, Star Wars: The

offending websites and an industry-wide campaign later

Force Awakens, Fast & Furious 7 and Avengers: Age Of

this year to warn of the risks of piracy and “appeal to

Ultron. Among the 5,793 TV shows available are The X

people’s inherent honesty.”

Files, Billions, Better Call Saul, The Walking Dead and

Don Groves

AUSTRALIAN HOME ENTERTAINMENT DISTRIBUTORS ASSOCIATION Yearbook 201510

Managing Director’s Insight
The Australian Home Entertainment Distributors Association gratefully acknowledges the following executives forcontributing their time, wisdom and experience to the preparation of this report.
Jim Batchelor
Managing Director, Universal
Sony Pictures Home Entertainment Australia
Jo Bladen
General Manager, Studios,
The Walt Disney Company Australia & New Zealand
Chris ChardManaging Director and Co-CEO,
Roadshow Films Group
Marilyn Greig
Managing Director,
Defiant! Screen Entertainment
Flavio Paoli
Senior Vice President, Australia & Japan,  Twentieth Century Fox
Jo Mandatis
Senior Vice President,
Home Entertainment, Entertainment One
Graeme Rogan
Head of Home Entertainment,
Studiocanal Australia

AUSTRALIAN HOME ENTERTAINMENT DISTRIBUTORS ASSOCIATION Yearbook 2015
11

The seasonality within thephysical retail channel is led by
big events, with a key focus on
the Christmas period.

AUSTRALIAN HOME ENTERTAINMENT DISTRIBUTORS ASSOCIATION Yearbook 201512Market Overview
The AHEDA Yearbook has in-depth and specific chapters on digital and retail physical home entertainment sales. This
overview provides an easily digestible snapshot of this data and the headline figures.

Digital Business
Australian consumer spending on digital video, whether via Pay TV VoD, digital retail, digital rental or digital
subscription, experienced rapid growth in 2015, climbing 49% to almost A$395 million compared with a year earlier.
IHS expects the strong growth to continue over the forecast period with the value of the Australian digital video market
forecast to reach A$1.1 billion in 2019.
Digital rental still holds the lion’s share of consumer spending on digital video accounting for 30% of total spending in2015 followed by digital retail (27%), digital subscription (26%), and Pay TV VoD (17%).
Digital subscription, commonly referred to as Subscription Video-on-Demand (SVoD), grew rapidly from a small base to
generate consumer spending of A$103 million in 2015. Driving growth was the launch of new services Netflix and Stanas well as the relaunch of existing service Presto.
Australia: Digital Video Spending 2009-2019
1,200

AUD, Millions

1,000

Digital subscription

800

Digital rental

600

Digital retail400

Pay TV VoD

200
0
2009

2010

2011

2012

2013

2014

2015

2016

2017

2018

2019

Digital transactional video volume and value increased 12.3% and 12.1% respectively in 2015 compared with a year
earlier, generating consumer revenue (consumer spending minus Goods and Services Tax) of A$187 million after
consumer transactions totaled 29 million.
Movie EST and VoD transactions also increased, up 17.6% to 3.0 million and 13.9% to 19.9 million respectively in2015, whilst TV EST revenue rose 10.1% to A$50.0 million after consumers made 5.9 million transactions over the

AUSTRALIAN HOME ENTERTAINMENT DISTRIBUTORS ASSOCIATION Yearbook 201513

Market Overview
same period. TV content consumed on a rental basis (TV VoD) remains niche. TV VoD consumer revenues reached
A$636,000 in 2015 from 226,000 transactions.
Movie VoD transactions continue to hold the lion’s share of total digital consumer transactions in Australia. Movie VoD
increased its share by one percentage point to account for 69% of digital transactions in 2015. Movie EST remained
steady at a 10% share whilst the rise of Movie VoD transactions came at the expense of TV EST transactions, which
saw its importance decline one percentage point to 20%.
Consumer Revenue (AUD Millions)

Australia: Consumer Revenue 2011-2015
200
180
Movie EST

160
140

Movie VoD

120
100

TV EST

80
60

TV VoD

40
20
0

2011

2012

2013

2014

2015

EST content holds a significantly higher share of revenues than transactions due to the higher price point charged
to own rather than to rent a title. As a result, Movie and TV EST accounted for a 21% and 27% share of consumer
revenues from digital transactional video respectively in 2015. Despite EST’s price premium, Movie VoD still held the
majority share of total consumer revenue (52%) in 2015.

Physical Business
The physical disc retail market generated $904 million in value in 2015, making it the largest of the video homeentertainment markets. The market has shown a downward trend since its peak in 2009 as consumers have diversified
the way they watch their video entertainment content.

$1.50
$1.00
$0.50
$0.00

Total Value
Total Units$0.22 $0.27

$0.50

$0.71

$0.94 $0.95

$1.06

$1.26

$1.35 $1.39$1.24 $1.29$1.15 $1.09

100$0.98 $0.90 80
60

Millions

Billions

GfK Retail Tracking: Physical Retail Market size

40
20
0

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

AUSTRALIAN HOME ENTERTAINMENT DISTRIBUTORS ASSOCIATION Yearbook 201514

Market Overview
GfK Retail Tracking: Physical Retail Market Value by Format

Billions

$1.50

$1.00

Blue Ray$0.1 $0.2

VHS

$0.50
$0.4

$0.00

$0.1

DVD

$0.6

$0.9 $0.9 $1.1

$1.3 $1.3 $1.3 $1.1
$1.1

$0.1
$0.2 $0.2 $0.2 $0.1

$0.2 $0.2

$0.1

$0.1

$1.0 $0.9$0.9 $0.8

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

In 2015, the physical DVD and Blu-ray retail channel sold over 50 million discs, for a total value of $904 million. This
represented a drop of 8% in value, though the rate of decline actually slowed from the -10% recorded in 2014.
The volume in the market was more stable, showing a 6% decline, with market prices dropping slightly in 2015
following a slew of cheaper blockbuster movie releases.
There were some big movie releases in 2015 and it doesn’t get any bigger than the dinosaur epic, Jurassic World.
Jurassic World was the top selling title for the year, leading the way for Universal who registered the top 3 titles for theyear.

AUSTRALIAN HOME ENTERTAINMENT DISTRIBUTORS ASSOCIATION Yearbook 201515

AUSTRALIAN HOME ENTERTAINMENT DISTRIBUTORS ASSOCIATION Yearbook 201516

Australian Digital Video
Market in 2015
This chapter on the Australian digital video market was written for AHEDA by IHS using AHEDA data and IHS’s own
research. Australian consumer spending on digital video, whether via Pay TV VoD, digital retail, digital rental or digital
subscription, experienced rapid growth in 2015, climbing 49% to almost A$395 million compared with a year earlier.
IHS expects the strong growth to continue over the forecast period with the value of the Australian digital video market
forecast to reach A$1.1 billion in 2019.
Digital rental still holds the lion’s share of consumer spending on digital video accounting for 30% of total spending in2015 followed by digital retail (27%), digital subscription (26%), and Pay TV VoD (17%).
Digital subscription, commonly referred to as Subscription Video-on-Demand (SVoD), grew rapidly from a small base to
generate consumer spending of A$103 million in 2015. Driving growth was the launch of new services Netflix and Stanas well as the relaunch of existing service Presto.
Digital transactional video volume and value increased 12.3% and 12.1% respectively in 2015 compared with a year
earlier, generating consumer revenue (consumer spending minus Goods and Services Tax) of A$187 million after
consumer transactions totalled 29 million
Australia: Digital Video Spending 2009-2019
Source IHS © 2016 IHS

1,200

AUD, Millions

1,000

Digital subscription

800

Digital rental

600

Digital retail400

Pay TV VoD

200
0
2009

2010

2011

2012

2013

2014

2015

2016

2017

2018

2019

Macroeconomic and Infrastructure Trends
Macroeconomic factors
The Australian economy grew in real terms by 2.3% to US$1.2 trillion in 2015. IHS forecast slightly weaker real GDP
growth of 2.2% for Australia in 2016, well below the country’s long-held trend growth rate of just over 3.0%. Australia’s
growth outlook is favourable compared with that of other advanced economies such as France (1.1%), Germany(1.5%), and the UK (2.2%), owing to proximity and trade ties with emerging Asian economies. Unfortunately, this

AUSTRALIAN HOME ENTERTAINMENT DISTRIBUTORS ASSOCIATION Yearbook 201517

Australian Digital Video
Market in 2015
outlook does risk the country becoming too reliant on volatile exports and the economic reform agendas in those Asian
economies for future growth. IHS forecasts annual average growth in retail sales of 5.3% for 2016 with consumer
demand supported by low oil prices, low inflation, low interest rates, and an active housing market.
Real GDP growth across countries (%)
Source IHS © 2016 IHS

United States

3.5

United Kingdom

GDP growth %

3.0
2.5

Spain

2.0

Japan

1.5
1.0

Italy

0.5

Germany

0.0-0.5

France2014

2015

Australia

Australia’s net export position will be the greatest contributor to near-term growth, as imports of capital andintermediate goods remain weak and export volumes rise. While the recent depreciation of the Australian dollar visà-vis the US dollar has made Australian exports more competitive, the weak external-demand environment will limit
the benefits to the broader economy. The greatest risk to Australia’s growth outlook is weakness in Chinese demandfor Australian commodities exports. Bouts of uncertainty about the global economy and continued weak domestic
demand will limit improvements in near-term non-mining business investment activity with some compensation from
low interest rates.
Undermining consumer spending will be sluggish wage growth and any bouts of global economic volatility. While somecommercial lenders are raising mortgage interest rates to compensate for increased capital requirements, interest rates
remain low, providing some support to household disposable income and consumer spending. The Reserve Bank ofAustralia (RBA) left the official cash rate target on hold at 2.00% under its first monetary-policy decision of 2016. The
bank’s monetary-policy board felt the current monetary-policy setting remained appropriate considering the RBA’s
expectations for continued economic growth and low inflation. The low inflation outlook gives the bank room to lower
interest rates if they deem it necessary in the future.
Australia’s real GDP per capita is one of the highest in the world at US$59,300 in 2015 compared with US$51,400 in
the US, US$40,900 in the UK and Spain’s US$30,800. However, Australia’s population growth is relatively rapid for anadvanced industrial economy, bringing per capita GDP growth down from 1.1% in 2014 to around 0.8% in 2015.

AUSTRALIAN HOME ENTERTAINMENT DISTRIBUTORS ASSOCIATION Yearbook 201518

Australian Digital Video
Market in 2015
Real GDP per capita across countries USD
Source IHS © 2016 IHS

United States

GDP Per Capita USD

70,00060,000

United Kingdom

50,000Spain

40,000Japan

30,000Italy

20,000Germany

10,000
0

2014

2015

FranceAustralia

Broadband Infrastructure

Australia’s telecommunications infrastructure is excellent, and continues to change and adapt to the latest technology.
Traditional telecommunication services including land-based and mobile telephones are mature. Broadband household
and smartphone penetration in Australia is high in the context of regional standards for the Asia Pacific, at 69% and
77% respectively at the end of 2015, according to IHS.
Improvements in infrastructure will facilitate further growth in broadband penetration, particularly the ongoing rolloutof the Australian Government-owned National Broadband Network (NBN). The open-access, superfast network aims
to connect eight million homes and businesses by 2020 via a mixture of technologies: fibre-to-the-premises (FTTP),
fibre-to-the-node (FTTN), fibre-to-the-distribution-point (FTTDP), fibre-to-the-building (FTTB), HFC (hybrid fibre coaxial),
satellite and fixed wireless. The NBN had passed 1.8 million premises and connected nearly 850,000 homes by theend of February 2016. Activating 10,000 new connections a week, NBN (the company) forecasts nearly one in four
homes will be able to order an NBN service by the end of June 2016, rising to three in four homes by June 2018.
Meanwhile, Australia has two INMARSAT (one Indian Ocean and one Pacific Ocean) earth stations and 10 INTELSAT
earth stations (four Indian Ocean and six Pacific Ocean). It also has its own domestic satellite system and links toIndonesia, Papua New Guinea and New Zealand via submarine cables. The dominant provider of fixed-line services inAustralia is Telstra. Telstra also has the majority of mobile phone subscribers, where it primarily faces competition from
Optus Mobile (a subsidiary of SingTel) and Vodafone.
Just over 53 million devices in Australia now connect to the Internet, up 8.9% in 2015. The smartphone is the newdominant single connected device surpassing the personal computer in 2015. Australia’s installed base of connected
smartphones increased 16% to 18.4 million in 2015 compared with nearly 18.0 million (-5.5%) connected personal
computers. The rapid rise of smartphone ownership is forecast to continue rising to just over 26.0 million by the end of
2019

AUSTRALIAN HOME ENTERTAINMENT DISTRIBUTORS ASSOCIATION Yearbook 201519

Australian Digital Video
Market in 2015
Australia: Conected Device Install Base Source IHS © 2016 IHS
80

DMAs

70

Pay-TV
set-top boxes

Units (Millions)60

BD players

50

Smart TVs

40

PCs

30

Game consoles

20

Tablets

100
2012

Smartphones
2013

2014

2015

2016

2017

2018

2019

Australian Digital Services
Digital Services: Transactional movies and TV		
BUSINESSRENTALRETAIL
COMPANYSERVICEMODEL
LAUNCHDATELAUNCH DATE_____________________________________________________________________________________________________
Telstra
BigPond Movies
Rental
Q1 06
Apple
iTunes Store (iTS)
Rental, retail
Q3 08
Q4 10
KanopyKanopyRentalQ4 08
FoxtelFoxtel Store (formerly Foxtel
Rental
Q4 09
Download)		
Microsoft

Microsoft Movies & TV
(formerly Xbox Video)

Rental, retail

Q4 09

MUBI

MUBI

Rental

Q1 09

Sony ComputerEntertainment
Europe (SCEE)
Fetch TV
iiNet
Sony
Beamafilm
Sony
Optus
Quickflix
Viewster AG
GoogleGoogleVimeo

PlayStation Store

Rental, retail

Q2 10

Fetch TV
iiNet TV with Fetch
Video Unlimited (Qriocity )Beamafilm
Sony Entertainment Network
Optus TV with Fetch
Quickflix
ViewsterYouTube Films
Google Play Movies
Vimeo On Demand

RentalRentalRentalRentalRental, retail
RentalRentalRentalRentalRental, retail
Rental, retail

Q2 10
Q2 10
Q4 10
Q1 11
Q2 11
Q4 11
Q1 12
Q1 12
Q2 12
Q2 12
Q2 13

Q4 12
Q2 13

Dendy Cinemas

Dendy Direct

Rental, retail

Q3 14

Q3 14

Q2 10

Q2 11

AUSTRALIAN HOME ENTERTAINMENT DISTRIBUTORS ASSOCIATION Yearbook 201520

Australian Digital Video
Market in 2015
Digital Services: Subscription Video Services
COMPANYSERVICE
BUSINESS MODELLAUNCH DATE_____________________________________________________________________________________________________
TelstraMobile Foxtel
Bundled telco product
Q4 06
Vivendi, Orange
Dailymotion
Standalone
Q4 08
MUBI
MUBI
Standalone
Q1 09
Bigstar TV
Big Star Movies
Standalone
Q4 09
Indieflix
Indieflix
Standalone
Q4 09
Fetch TV
Fetch TV
Standalone/Pay TV
Q2 10
iiNet
iiNet TV with Fetch
Bundled telco product
Q2 10
Beamafilm
Beamafilm
Standalone
Q1 11
Quickflix
Quickflix
Standalone/Bundled		with DVD rentals
Q4 11/Q2 13
Optus
Optus TV with Fetch
Bundled telco product
Q4 11
FoxtelFoxtel Go
Device based
Q4 12
FoxtelFoxtel Play
Standalone/Pay TV
Q3 13
FoxtelPresto Movies
Standalone
Q1 14
FoxtelPresto TV
Standalone
Q1 15
FoxtelPresto Entertainment
Standalone
Q1 15
StreamCo (NineStanStandalone
Q1 15
Entertainment andFairfax Media)
Netflix
Netflix
Standalone
Q1 15_____________________________________________________________________________________________________

Digital Services: Subscription Video Services
COMPANYPLATFORMTECHNOLOGY
BUSINESS MODELLAUNCH DATE_____________________________________________________________________________________________________
FoxtelCable
nVoD
Rental
1999
Optus TV
Cable
nVoD
Rental1999
FoxtelSatellite
nVoD
Rental
1999
Optus TV with Foxtel
Cable
nVoD
Rental2002
Foxtel On Demand
Satellite
Push-VoD
Rental2007
Foxtel Anytime
Satellite
IP-VoD
Rental2008
Fetch TV
IPTV/OTT
IP-VoD/OTT
Rental2010_____________________________________________________________________________________________________

AUSTRALIAN HOME ENTERTAINMENT DISTRIBUTORS ASSOCIATION Yearbook 201521

Australian Digital Video
Market in 2015
Definitions and examples_____________________________________________________________________________________________________
Digital Video
Refers to retail and rental transactional and subscription movies and TV content purchases 		
via both the open internet (online) and closed pay TV networks (Pay TV on-demand).
Digital Retail

A method of selling digital content that gives the customer ownership over the files they havedownloaded, allowing the customer to use the content as many times as they like - thedigitally distributed equivalent of conventional retail channels. Digital retail is also known as 		‘download-to-own’ (DTO), ‘electronic sell-thru’ (EST) and ‘digital sell through’. Excludes free,subscription, and adult content.

Digital Rental

A method of renting digital content whereby customers commonly choose content on an a lacarte basis and pay to watch it for a limited period. Digital rental is also known as Video-onDemand (VoD) and Pay Per View (PPV). PPV content can be downloaded or streamed. 		
Excludes free, subscription, events and adult content. For example, a movie rental through
iTunes.

Pay TV On-Demand(Pay TV VoD)

The practice of paying for a rental on an a la carte basis over a closed pay TV network.
Formally speaking it applies to a temporary right of use that is purchased by a one off
payment. It can be either movies or TV shows. For example, a movie rental through Foxtel’ssatellite TV platform.

Digital Subscription

Digital subscription commonly referred to as Subscription Video-on-Demand (SVoD). This 		
metric refers to standalone digital subscribers. For example, Netflix, Presto, Quickflix andStan. Does not include users of bundled packages (e.g. Foxtel Go access available 			free to Foxtel pay TV subscribers in Australia).
_____________________________________________________________________________________________________

AUSTRALIAN HOME ENTERTAINMENT DISTRIBUTORS ASSOCIATION Yearbook 201522

Australian Digital Video
Market in 2015
Methodology•

The data in this report is an aggregate of participating AHEDA members, and not a market total unlessotherwise stated; e.g. placed in an international context for comparative purposes.

•

The data reported to IHS is units and either consumer or trade (distributor) revenue. This data is analysed to 		produce totals for both consumer and trade revenues; which is to say we do not simply sum the provided 		
consumer data to produce the consumer total and provided trade data to provide the trade total. Instead, wemark up and mark down the provided data as appropriate to provide a fuller assessment of the market. For 		
example, TV EST revenue provided by Studio A at a consumer level is marked down to estimate Studio A’s
trade revenue; while Studio B, providing trade revenue, is marked up to reach the consumer total.

•

To estimate these mark-up factors we use a mixture of i.) Participant feedback, ii.) Our knowledge ofinternational digital home entertainment practices, iii.) The data provided by the participants as a benchmark foraverage per-transaction price.

•

TV series sales are reported as one transaction and not by the volume of episodes sold; e.g., a purchase of
Season 1 of a TV series is reported as one transactions and not 22 episodes.

•

Zero price transactions are excluded from reporting. Only items where a standard wholesale price is paid to thestudio are included. Bundled promotions where there is a flat up-front fee paid to the studio are excluded.

Revenue & GST•
Revenue is reported at consumer level and is reported exclusive of Goods & Services Tax (GST).
Spending & GST•
Spending is reported inclusive of Goods & Services Tax (GST).
Average Selling Price (ASP)•
Consumer average selling price (ASP) is inclusive of GST as this allows participants to calculate the total 		consumer spend by multiplying the consumer ASP against the number of units.

Exchange Rates: US Dollar
		
2011
2012
		
$1=
$1=
Australia
AUD
0.97
0.97
France
EUR
0.72
0.78
Germany
EUR
0.72
0.78
Italy
EUR
0.72
0.78
Spain
EUR
0.72
0.78
UK
GBP
0.62
0.63
US
USD
1.00
1.00

2013
$1=
1.04
0.75
0.75
0.75
0.75
0.64
1.00

2014
$1=
1.11
0.75
0.75
0.75
0.75
0.61
1.00

2015
$1=
1.33
0.90
0.90
0.90
0.90
0.65
1.00

2016
$1=
1.33
0.90
0.90
0.90
0.90
0.65
1.00

2017
$1=
1.33
0.90
0.90
0.90
0.90
0.65
1.00

2018
$1=
1.33
0.90
0.90
0.90
0.90
0.65
1.00

2019
$1=
1.33
0.90
0.90
0.90
0.90
0.65
1.00

AUSTRALIAN HOME ENTERTAINMENT DISTRIBUTORS ASSOCIATION Yearbook 201523

Australian Digital Video
Market in 2015
Australian Digital Video Market
Australian Digital Transactional Video Market

The Australian digital transactional video market continues to show healthy development overall, recording consecutive
year-on-year growth in consumer transactions and revenue since 2011 according to IHS analysis of data from theAustralian Home Entertainment Distributors Association (AHEDA). Digital video transactions are paid-for transactional
non-physical retail and rental purchases of Movie and TV content. Digital transactional video volume and value
increased 12.3% and 12.1% respectively in 2015 compared with a year earlier, generating consumer revenue(consumer spending minus Goods and Services Tax) of A$187 million after consumer transactions totalled 29 million.
Australia: Consumer Transactions 2011-2015

Transactions (Millions)

Source IHS © 2016 IHS

30
Movie EST

25
20

Movie VoD

15TV EST

10

TV VoD

5
0

2011

2012

2013

2014

2015

Digital retail, also known as ‘electronic sell-thru’ (EST), ‘download-to-own’ (DTO), and ‘digital sell through’, increased 14.1% to A$89.9 million in2015 compared with the previous year. Digital rental, also known as ‘Video-on-Demand (VoD) and ‘Pay-Per-View (PPV)’, rose 10.3% to A$97.4
million in 2015 over the same period.

Australia: Consumer Revenue 2011-2015

Consumer Revenue (AUD Millions)

Source IHS © 2016 IHS

200
180
160

Movie EST140
120

Movie VoD

100

TV EST

80
60

TV VoD

40
20
0

2011

2012

2013

2014

2015

AUSTRALIAN HOME ENTERTAINMENT DISTRIBUTORS ASSOCIATION Yearbook 201524

Australian Digital Video
Market in 2015
Movie EST and VoD transactions also increased, up 17.6% to 3.0 million and 13.9% to 19.9 million respectively in2015, whilst TV EST revenue rose 10.1% to A$50.0 million after consumers made 5.9 million transactions over thesame period. TV content consumed on a rental basis (TV VoD) remains niche. TV VoD consumer revenues reached
A$636,000 in 2015 from 226,000 transactions.
Movie VoD transactions continue to hold the lion’s share of total digital consumer transactions in Australia. Movie VoD
increased its share by one percentage point to account for 69% of digital transactions in 2015. Movie EST remained
steady at a 10% share whilst the rise of Movie VoD transactions came at the expense of TV EST transactions, which
saw its importance decline one percentage point to 20%.
Australia: Transactions by digital service 2011-2015
Source IHS © 2016 IHS

10% 1%

10% 1%
20%

21%

Movie EST
Movie VoD

68%

69%

2014

2015

TV ESTTV VoD

EST content holds a significantly higher share of revenues than transactions due to the higher price point charged
to own rather than to rent a title. As a result, Movie and TV EST accounted for a 21% and 27% share of consumer
revenues from digital transactional video respectively in 2015. Despite EST’s price premium, Movie VoD still held the
majority share of total consumer revenue (52%) in 2015.
Australia: Consumer Revenue 2011-2015
Source IHS © 2016 IHS

0%

0%

20%

27%

21%

27%

Movie EST
Movie VoD

53%

52%

2014

2015

TV ESTTV VoD

AUSTRALIAN HOME ENTERTAINMENT DISTRIBUTORS ASSOCIATION Yearbook 201525

Australian Digital Video
Market in 2015
Australia continues to exhibit a seasonal trend in monthly digital sales. December and January have been peaktransactional periods of each year since 2011 accounting for just under 20% of annual revenue in 2015. Driving
these standout returns are consumers gifting hardware and vouchers for Christmas. Consumers receive their gift in
December and subsequently test out their new hardware by purchasing digital content shortly thereafter. This trend
continues in January when consumers also buy new hardware and titles with their gift vouchers. Despite this trend,
an individual month is highly susceptible to the movie and TV release slate for the period, which results in fluctuations
month-to-month.
Australia: Monthly Consumer Transactions 2012-2015
Source IHS © 2016 IHS

3.0
2.5
2.0
1.5
1.0
0.5
0.0

Dec 12
Jan 13
Feb 13
Mar 13
Apr 13
May 13
Jun 13
Jul 13
Aug 13
Sep 13
Oct 13
Nov 13
Dec 13
Jan 14
Feb 14
Mar 14
Apr 14
May 14
Jun 14
Jul 14
Aug 14
Sep 14
Oct 14
Nov 14
Dec 14
Jan 15
Feb 15
Mar 15
Apr 15
May 15
Jun 15
Jul 15
Aug 15
Sep 15
Oct 15
Nov 15
Dec 15

Transactions (Millions)

3.5

Movie EST

Movie VoDTV ESTTV VoD

Australia: Monthly Consumer Revenue 2012-2015

20
18
16
14
12
10
8
6
4
2
0

Dec 12
Jan 13
Feb 13
Mar 13
Apr 13
May 13
Jun 13
Jul 13
Aug 13
Sep 13
Oct 13
Nov 13
Dec 13
Jan 14
Feb 14
Mar 14
Apr 14
May 14
Jun 14
Jul 14
Aug 14
Sep 14
Oct 14
Nov 14
Dec 14
Jan 15
Feb 15
Mar 15
Apr 15
May 15
Jun 15
Jul 15
Aug 15
Sep 15
Oct 15
Nov 15
Dec 15

Consumer Revenue (Millions)

Source IHS © 2016 IHS

Movie EST

Movie VoDTV ESTTV VoD

AUSTRALIAN HOME ENTERTAINMENT DISTRIBUTORS ASSOCIATION Yearbook 201526

Australian Digital Video
Market in 2015
Average monthly pricing for a digital title also fluctuates during the year due to price promotions. The average price inDecember tends to decline, largely due to seasonal promotional activity as well as from consumers trying out lower
priced catalogue titles after being gifted with new devices during the Holiday season.
In November 2015, Australian consumers paid an average of A$15.33 including a 10% Goods and Services Tax (GST)
to buy a digital movie title. In December 2015, this average price had dropped 7.8% to A$14.13. The consumer priceof a TV EST title continued its steady rise since 2012, increasing from an average price of A$7.32 in December 2012 to
A$9.24 in December 2015.
The average price to rent a digital movie title has remained broadly flat since December 2012, when consumers paid
A$5.65, compared with A$5.38 in December 2015. By comparison, consumers paid an average of A$2.33 to rent out
a TV title in December 2015.
A price check at the time of publication shows Spectre 007, the latest movie in the James Bond franchise, available
on the Apple iTunes store to buy for A$24.99 and rent for A$6.99 in high-definition (HD) format. The standard definition(SD) version is priced at A$19.99 and A$5.99 respectively. The HD version of the catalogue movie Footloose costs
A$9.99 to buy and A$4.99 to rent whilst the SD version to buy and rent is priced at A$7.99 and A$3.99 respectively.
To own an episode of the the TV hit show Downton Abbey consumers will need to pay A$3.49 (HD) or A$2.99 (SD).
Australia: Monthly Consumer average selling price AUD

18
16
14
12
10
8
6
4
2
0

Dec 12
Jan 13
Feb 13
Mar 13
Apr 13
May 13
Jun 13
Jul 13
Aug 13
Sep 13
Oct 13
Nov 13
Dec 13
Jan 14
Feb 14
Mar 14
Apr 14
May 14
Jun 14
Jul 14
Aug 14
Sep 14
Oct 14
Nov 14
Dec 14
Jan 15
Feb 15
Mar 15
Apr 15
May 15
Jun 15
Jul 15
Aug 15
Sep 15
Oct 15
Nov 15
Dec 15

Consumer Average Selling Price, AUD

Source IHS © 2016 IHS

TV VoDTV EST

Movie VoD

Notes: Consumer average selling price includes 10% Goods and Services Tax (GST).

Movie EST© 2016 IHS

AUSTRALIAN HOME ENTERTAINMENT DISTRIBUTORS ASSOCIATION Yearbook 201527

Australian Digital Video
Market in 2015
Australian Digital Subscription Market
Digital subscription, commonly referred to as Subscription Video-on-Demand (SVoD), is fast becoming a popular way
for Australians to watch video content with many consumers supplementing their free-to-air television viewing with
on-demand, internet delivered content. Demand for SVoD services expanded rapidly in Australia in 2015 on the backof several new services. Increased mainstream advertising, promotional free subscription trials and heightened media
interest around the new services helped boost consumer awareness and demand for SVoD services over the period.
Australian consumer spending on digital subscription services soared up from A$9.7 million in 2014 to A$103 million in2015.
A key driver in SVoD gaining traction across the country is the Netflix service, which launched in Australia on 24
March 2015 – the company’s first Asia-Pacific territory. Driving this growth is the company’s comparatively large title
catalogue, competitive pricing and existing relationships with several connected device platforms.
Despite its market leading position, Netflix faces formidable competition from homegrown SVoD players in Australia
including Presto, Stan, Quickflix and Dendy Direct. Local rent-by-mail operator Quickflix is Australia’s oldest SVoD
service launching its streaming service in 2011. By the end of 2014, Quickflix and Presto Movies had signed up
just 100,000 of Australia’s 5.8 million broadband households. Within three months, however, two more services
had launched (Netflix and Stan) while Presto had relaunched Presto, including Presto TV for TV shows and Presto
Entertainment for bundled Movies and TV shows, at a much lower price which significantly boosted consumer
adoption of SVoD services in Australia. By end 2015, IHS research indicates Australian SVoD operators had signed up
just under 1.6 million subscribers.
Players in the traditional TV space back Stan and Presto. Stan by Nine Entertainment/Fairfax Media and Presto by
Seven West Media and Foxtel, Australia’s pay TV leader. Presto’s catalogue has a collection of TV shows from HBO,
SHOWTIME, CBS, Viacom International Media Networks, and local content from Foxtel, Seven Network, and ABC
Commercial whilst it also licences a catalogue of movies from the major studios and key independents players. SVoD
operators are also signing deals with the country’s telecommunications operators in an attempt to attract customers;e.g., SVoD services are bundled free with a phone subscription for several months such as deals between Stan andVodafone as well as between Presto and Telstra.

AUSTRALIAN HOME ENTERTAINMENT DISTRIBUTORS ASSOCIATION Yearbook 201528

Australian Digital Video
Market in 2015
Australia: Digital Subscription Consumer spending, AUD Millions
Source IHS © 2016 IHS

800
700

AUD, Millions

600
500
400
300
200
100
0

2013

2014

2015

2016

2017

2018

Notes: Digital subscription is effectiively online SVoD services such as Netflix, Presto, Quickflix and Stan.

2019

The Australian SVoD market has already seen some local players fall prey to Netflix’s entry in March 2015. Movie
streaming company, Ezyflix closed its business in August 2015 and the publicly listed Quickflix lost 8% of its
subscribers in the last financial quarter ending 31 December 2015.
However, Netflix does face challenges as the company finds itself embroiled in the country’s ongoing media reforms
debate in early 2016. Not surprisingly, local over-the-top (OTT) players are fueling the discussion citing that Netflix does
not face the same regulatory restrictions including advertising restrictions, content quotas and tax liabilities, which allow
the company to operate more freely than its Australian-based competitors. The discussion comes as the AustralianGovernment considers changes to media laws that would relax media ownership and concentration rules.
The online video giant’s strong financial position and high-quality original foreign content ensures Netflix will remain amajor player in the Australian SVoD market. However, the scale of its success will also hinge on how it promotes andprograms its service locally and on its ability to drive subscription take-up via its local Internet and IPTV providers. It
will also be important for Netflix to beef-up its local content library, to create original programming for its Australianaudience. Despite their smaller budgets, Presto and Stan are already investing in exclusive, original local content
including a spin-off of the long-running Australian TV drama series Home and Away and the TV adaptation of Australianfilm production Wolf Creek. However, Netflix has a proven track record of collaborating with local partners to boost
both its reach and its programming content and IHS expects Australia to be no exception. IHS forecast Australianconsumer spending on digital subscription to reach A$710 million in 2019.

AUSTRALIAN HOME ENTERTAINMENT DISTRIBUTORS ASSOCIATION Yearbook 201529

Australian Digital Video
Market in 2015
Australian Pay TV VoD Market
Pay TV landscapeAustralia’s leading pay TV operator Foxtel continues to strengthen its position as the country’s preferred hub for pay TV
content. Australia’s incumbent telco Telstra and News Corporation jointly own Foxtel, which now operates an effective
monopoly following the acquisition of rival regional pay TV operator Austar in May 2012. Foxtel also wholesales pay TV
services to Optus, the country’s second-largest pay TV operator.   
Foxtel, available via cable and satellite, continues to gain subscribers, adding 208,000 new customers in 2015 toreach nearly 2.9 million subscribers. Driving growth is a revamp of the company’s pay TV pricing and packaging
options, including a reduction in the price of its basic package from A$49 ($35) to A$25 ($18) a month, a response toincreasing competition from free-to-air (FTA) digital terrestrial television (DTT) broadcasters, OTT TV providers and rival
pay TV operators.
Despite growing competition from FTA and OTT operators, an even bigger battle looms in the Australian Pay TV market
for Foxtel from its long-standing rival Optus. In a major acceleration of its content strategy, Optus is shifting its focus tobecoming a content-led telecommunications provider. Optus secured broadcast and digital rights in November 2015
to all 380 English Premier League matches for three years commencing in August 2016. The deal snatches the popular
content from News Corporation’s Fox Sports channels, which air as part of Foxtel’s sports package. Furthermore,
Optus signed a three-year sponsorship deal with Cricket Australia (CA) in October 2015 that includes hundreds of ondemand hours of unique cricket content. Eligible Optus customers will also be able to stream unmetered live matches
via the CA Live Pass application.
Foxtel is making its own strategic moves, to position itself in advance of potential competitors, by extending its
portfolio. The operator entered a binding agreement to acquire a 15% stake in Network Ten in June 2015, which
received regulatory approval in October 2015. The deal enables Foxtel to target a combined audience of more than
10 million. Network Ten reaches approximately eight million people in the country every week with popular shows
including MasterChef, Shark Tank, and I’m A Celebrity…Get Me Out Of Here.  
Pay TV operators in the country are also looking to triple play opportunities to strengthen their consumer offering. Since
2010, partnerships have formed between several local ISP’s and a third party IPTV provider Fetch TV. Fetch, owned by
Malaysian operator Astro, is an IPTV STB that offers linear IPTV channels, and rental movies on demand. IHS research
estimates Fetch recorded strong subscriber growth in 2015 increasing its subscriber base almost 30% to 241,000
subscribers compared with the previous year.

AUSTRALIAN HOME ENTERTAINMENT DISTRIBUTORS ASSOCIATION Yearbook 201530

Australian Digital Video
Market in 2015
Meanwhile, the majority of pay TV homes in Australia use a satellite connection to receive their signal. Satellite homes
represent nearly 62% of total pay TV homes in the country. The platform remains dominant but in recent years has lost
share to IPTV. IPTV’s share of total Australian Pay TV homes increased from 7.5% in 2014 to 9.2% in 2015. IPTV takeup is also having an impact on cable’s share of market, which fell from 31% to 29% over the same period.   
Australia: Pay-TV subscibers by operator 2012-2015
Source IHS © 2016 IHS

3.5

Subscribers (Millions)

3.0
Fetch TV (IPTV)

2.5

TransACT TV (IPTV)

2.0

Optus TV (Cable)

1.5
1.0

Foxtel (Satellite)

0.5

Foxtel (Cable)

0.0
YE 2012

H1 2013

YE 2013

H1 2014

YE 2014

H1 2015

YE 2015Australian Pay TV VoD Market
Foxtel’s dominance of the Australian pay TV subscriber base extends to the Pay TV VoD market in Australia. Foxtel
accounted for 90% of Movie and TV transactions by Pay TV operators in 2015 followed by Fetch TV (7%) and Optus
TV (3%).
Australia: Movie and TV transactions by Pay-TV Operators 2014-2015
Source IHS © 2016 IHS

2% 5%

3%

7%
26%

28%
65%

2014

64%

2015

Foxtel Cable
Foxtel Satellite
Optrus TV
Fetch TV

Despite fluctuations throughout the year, new-release movie revenues per Pay TV subscriber continue to rise,increasing each of the past five years. Pay TV subscribers spent an average of A$3.70 each to stream a movie in
December 2015, up from A$3.03 in December 2010.

AUSTRALIAN HOME ENTERTAINMENT DISTRIBUTORS ASSOCIATION Yearbook 201531

Australian Digital Video
Market in 2015
Australia: New release movie VOD spending per Pay-TV subscriber
Source IHS © 2016 IHS

Pay TV subscriber (AUD)

Average VOD spending per

4.0

3.0

2.0

1.0

0.0

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q42012 2012 2012 2012 2013 2013 2013 2013 2014 2014 2014 2014 2015 2015 2015 2015

New Release Movies continue to drive the Pay TV VoD business in Australia accounting for 90% and 93% of consumertransactions and revenue in 2015 respectively. Catalogue Movies saw its importance increase slightly after its share oftransactions rose from 6.1% in 2014 to 7.1% in 2015 whilst revenues climbed from 4.6% to 5.3%. TV shows remain asmall part of the total Pay TV VoD business accounting for just 1.4% of revenue and 3.3% of transactions in 2015.
Australia: Pay-TV VOD consumer transactions and revenue by genre
Source IHS © 2016 IHS
100%

Percentage (%)

80%

New Release Movies
60%

Catalogie Movies
40%

TV
20%
0%

2014

2015

2014

Transactions

2015
Revenues

AUSTRALIAN HOME ENTERTAINMENT DISTRIBUTORS ASSOCIATION Yearbook 201532

Australian Digital Video
Market in 2015
High vs Standard Definition content splits
Standard-definition (SD) content still dominates across each sector (retail and rental) and genre (movies and TV) of theAustralian digital transactional video market. SD content accounted for just over three-quarters of TV EST consumer
revenue generated in 2015, down two percentage points from a year earlier. Meanwhile SD content captured 68% of
consumer revenue from the Movies EST and 61% from Movies Rental business in 2015.
Despite the increasing shift toward High-Definition (HD) content, IHS forecast SD content to continue generating the
majority of consumer revenues across each sector and genre in 2019. SD content will still account for 70% of total
consumer revenues from TV EST in 2019, compared with 57% and 58% shares of total consumer revenues from theMovies EST and Rental businesses respectively.
Australia: TV EST shares of HD/SD in Consumer Revenues 2014-2015
Source IHS © 2016 IHS

22%

24%

SD
78%

78%

2014

HD

2015

Australia: Movies EST shares of HD/SD in Consumer Rev 2014-2015
Source IHS © 2016 IHS

30%

32%
70%

SD
68%

2014

HD

2015

Australia: Movies Rental shares of HD/SD in Consumer Rev 2014-2015
Source IHS © 2016 IHS

39%

39%
61%

SD
61%

2014

HD

2015

AUSTRALIAN HOME ENTERTAINMENT DISTRIBUTORS ASSOCIATION Yearbook 201533

Australian Digital Video
Market in 2015
Australian Pay TV VoD Market
The Australian digital video landscape remains in a strong growth position on the world stage. In 2015, Australian
digital retail transactions increased 9.4% to 9.5 million compared with a year earlier. Italy recorded the highest rate of
growth in EST transactions over the same period, up 19.9% to 1.4 million followed by the UK (11.4%) and Germany(11.3%).
Australia also recorded strong growth of 12.8% to 30.1 million in combined Pay TV VoD and digital rental transactionsin 2015 but comparatively was outperformed by growth in Spain (34.9%), Germany (23.6%), and the UK (17.1%).
Altogether, Australia recorded solid double-digit growth in combined digital retail, digital rental and Pay TV VoD
transactions of 12.0% to 39.6 million in 2015 compared with the previous year. By comparison, Spain topped growthamong the major territories rising 32.5% to 14.7 million transactions in 2015.
Meanwhile, the number of digital transactions in the US dwarfs those recorded in the rest of the world. US consumers
made just under 546 million digital transactions in 2015, up less than one per cent from a year earlier. US ESTtransactions performed well, rising 6.2% to 204 million but it was a 2.4% decline to 342 million in VoD transactions,which stifled growth.
The UK recorded the second largest number of digital transactions in 2015 with 111 million, up from 96 million in 2014.
Sky’s dominance in the UK is driving VoD transactions, which account for a commanding three-quarter share of the
UK’s total digital transactions in 2015. The number of transactions by Australian consumers in 2015 (39.6 million) ranks
the country between Italy (19.1 million) and France (57.2 million). Piracy is largely affecting the size of the Italian andSpanish digital markets.
Australia: VoD and EST Transactions (Millions)

Transactions (Millions)

Source IHS © 2016 IHS

120

600

100

500

80

400

60

300

40

200

20

100

0

2014 2015 2014 2015 2014 2015 2014 2015 2014 2015 2014 2015
FranceGermany

Italy

Spain

EST

UK

Australia

0

2014

2015

US

VoD

AUSTRALIAN HOME ENTERTAINMENT DISTRIBUTORS ASSOCIATION Yearbook 201534

Australian Digital Video
Market in 2015
Australian digital transactions per capita are almost on par with the UK and US and above those in other major
European territories. In 2015, Australians each made an average of nearly 1.7 digital transactions, up from 1.5 ayear earlier. US and UK digital transactions average just over 1.7 transactions per person, after this rate remained
unchanged in the US from 2014 and increased from 1.5 digital transactions per capita in the UK over the same period.
VoD and EST Transactions per capita
Source IHS © 2016 IHS

1.8

Transactions per capita

1.6
1.4
1.2
1.0
0.8
0.6
0.4
0.2
0.0

2014 2015 2014 2015 2014 2015 2014 2015 2014 2015 2014 2015 2014 2015
FranceGermany

Italy

Spain

EST

UK

Australia

USVoD

The US digital video transactional market grew 8.8% to over US$4.0 billion for the first time in 2015. Driving growth
was an 18.7% growth in consumer revenue from EST which itself passed US$2.0 billion for the first time. EST
represented nearly 52% of consumer revenue from total digital retail and rental transactions in 2015, up from a 47%
share in 2014.
Meanwhile, the negative impact of exchange rates on reported consumer revenue figures for non-US markets has
had a disproportionate impact on the trend in these markets. For example, Australian consumer revenue from the
combined digital retail and rental transactional sectors declined 4.4% in US dollar terms to US$186 million in 2015
compared to a 14.7% rise to A$247 million over the same period when viewed in local currency. Similar declines or
reduced rates of growth also occurred in all other non-US markets in 2015 due to fluctuations in local to US dollar
exchange rates. Therefore, while this analysis remains an accurate picture of the actual value of the markets in USD
within the wider economic environment, it is less indicative of the trend experienced in the non-US markets.

AUSTRALIAN HOME ENTERTAINMENT DISTRIBUTORS ASSOCIATION Yearbook 201535

Australian Digital Video
Market in 2015
VoD and EST Consumer Revenue (USD, Millions)

Consumer Revenue (USD, Millions)

Source IHS © 2016 IHS

700

7,000

600

6,000

500

5,000

400

4,000

300

3,000

200

2,000

100

1,000

0

2014 2015 2014 2015 2014 2015 2014 2015 2014 2015 2014 2015
FranceGermany
Italy
Spain
UK
Australia
EST02014 2015
USVoD

VoD and EST Consumer Revenue per capita USD
Source IHS © 2016 IHS

Consumer Revenue per capita, USD

14
12
10
8
6
4
2
0

2014 2015 2014 2015 2014 2015 2014 2015 2014 2015 2014 2015 2014 2015
FranceGermany

Italy

Spain

EST

UK

Australia

US

VoD

Australian digital video service pricing is on par with average prices in the big five European markets. Digital movies
cost an average of US$11.83 to purchase in Australia during 2015 compared to an US$11.19 average across the
big five in Europe. Meanwhile, Australian Pay TV VoD services were charging an average of US$3.85 in 2015, almost
identical to the average price of US$3.81 to rent a digital movie from an OTT operator.
US digital pricing for movies is more expensive than in Australia across Pay TV VoD and digital retail and rental
transactional services in 2015. Digital movies cost an average of US$15.16 to purchase and US$4.49 to rent in 2015
whilst US Pay TV VoD services charged an average of US$5.46 to rent a movie over the same period.

AUSTRALIAN HOME ENTERTAINMENT DISTRIBUTORS ASSOCIATION Yearbook 201536

Australian Digital Video
Market in 2015
2015: Average Transactional Movie Price, USD
Source IHS © 2016 IHS
16
14
12
Pay TV Rental (Movies)

USD

10
8

Digital Retail (Movies)

6

Digital Rental (Movies)

4
2
0FranceGermany

Italy

Spain

UK

Australia

US

Digital in the wider video sector
Digital accounts for a relatively small proportion of the total video sector, and its growth in the Australian market has
thus far failed to offset the decline in consumer spending on physical video. IHS analysis indicates total video market(digital and physical) consumer spending in Australia declined 0.4% to A$1.51 billion in 2015 compared with theprevious year. Physical video formats (Blu-ray Discs, DVD, retail, and rental) accounted for 74% of Australian spendingon video in 2015, down from an 83% share in 2014.
Australians spent a total of A$1.12 billion on physical video discs in 2015, down 10.8% compared with a year earlier.
The decline in spending on physical video in recent years has now settled into a steady pace at around 11% per year.
Retail spending on discs declined 7.7% to almost A$902 million in 2015, which IHS forecast will continue declining toA$630 million in 2019. Disc rental slumped 22% to A$216 million in 2015 compared with a year earlier and is forecast
to total just under A$61 million in 2019.
Australia: Total Video Spending, AUD Billion (Fixed exchange rate)
Source IHS © 2016 IHS

AUD billion (Fixed exchange rate)

2.0
1.8
1.6

Digital subscription

1.4

Digital rental

1.2
1.0

Digital retail

0.8

Pay TV VoD

0.6

Physical rental

0.4
0.2
0.0
2014

Physical retail
2015

2016

2017

2018

2019

AUSTRALIAN HOME ENTERTAINMENT DISTRIBUTORS ASSOCIATION Yearbook 201537

Australian Digital Video
Market in 2015
The decline in physical video’s importance is due to the increase in alternative video platforms. These alternative
platforms continue to offer consumers the ability to either choose the time they watch selected content or instantaccess to content from a limited catalogue, in the same way as physical video, but effectively for a lower cost per viewfor content.
Not the least of these platforms is online piracy, but this is not the only alternative now open to consumers. Legal
alternatives are represented by increases in free-to-air TV viewing, and gains from a blended offering including Pay TV
VoD services and digital delivery over the open internet. Pay TV VoD (delivered via ‘walled garden’ services) increased
9.8% to A$67 million in 2015. New SVoD services in Australia place further pressure on the physical disc market
particularly for consumer spending on library movie or TV content. In 2015, consumer spending on digital subscription
surged ten-fold to A$103 million on the back of strong growth in the Netflix, Presto, and Stan services. Digital rental
and retail also continued their high rate of growth in 2015, increasing 23% to A$119 million and 8.3% to A$106 million
respectively.
In 2015, Australia’s combined spending on digital video (whether via pay TV VoD services or delivery over the open
internet) grew 49% to nearly A$395 million. As a result, the digital video segment accounted for 26% of total spendingon video in 2015, up from a share of 17% in 2014.
In the world’s largest digital video market, the USA, IHS forecast that the growing SVoD industry will primarily help tooffset the decline in physical video spending over the forecast period. Total US video spending rose 1.6% to US$21.2
billion in 2015 compared with a year earlier. Importantly, consumer spending on digital video passed physical video
spending for the first time in 2015 to increase its share of total video spending from 48% in 2014 to 54% in 2015. IHS
expects this to lead the US home entertainment market to maintaining a level of growth.
USA: Total Video Spending, AUD Billion (Fixed exchange rate)
Source IHS © 2016 IHS

USD billion (Fixed exchange rate)

30.0

Digital subscription

25.0

Digital rental

20.0

Digital retail

15.0

Pay TV SVoD
Pay TV TVoD

10.0

Physical rental

5.0
0.0
2014

Physical retail
2015

2016

2017

2018

2019

AUSTRALIAN HOME ENTERTAINMENT DISTRIBUTORS ASSOCIATION Yearbook 201538

Australian Digital Video
Market in 2015
Australian Filmed Entertainment Industry Trends
Consumer spending on filmed entertainment in Australia - physical, digital, Pay TV and theatrical – increased 2.2% tojust over A$5.5 billion in 2015 compared with the previous year. The proportion of total filmed entertainment spending
accounted for by Cable and satellite subscriptions fell slightly in 2015 to A$2.8 billion but still represented half of total
spending. Cable and satellite subscriptions will continue to dominate the filmed entertainment space accounting for
52% of total spending in 2019, A$3.4 billion, largely driven by sports content.  
At just over A$1.2 billon, theatrical accounts for the second largest share (22%) of total consumer spending on filmed
entertainment in 2015. IHS forecast theatrical’s share to remain broadly level at 20% over the forecast period.
Physical video’s share of consumer spending on filmed entertainment will decline from 21% in 2015 to 11% by 2019.
The downturn in physical is a result of the combined declines in spending on disc rentals (-22%) to A$216 million anddisc purchases (-7.7%) to A$902 million.
The combined spending on Pay TV VoD and digital video represented 7.1% of total spending on filmed entertainment
in 2015, up from a 4.9% share a year earlier. Pay TV VoD and digital video spending is forecast to reach just over
A$1.1 billion by 2019 or 17% of total consumer spending on filmed entertainment.
Australia: Total filmed entertainment industry consumer spending split by segments, 2015 + 2019 (Fixed exchange rate)
Source IHS © 2016 IHS

2%1%

Physical retail

2% 2%Physical retail

17%
50%

4%

22%

3%
2%
1%

11% 10%

1%

Theatrical
Cable and sat subs

20%
52%

Pay TV TVoD
Digital retail
Digital rental

2015

2019

Digital subscription

The Netherlands Primary Pay TV penetration rate of 98.5% topped the world by the end of 2015, closely followedby South Korea (98.3%) and Belgium (97.5%). IHS measure Primary Pay TV penetration rates to remove thedouble counting of homes with more than one service or platform so that relevant totals never exceed 100% of TV
households. Where Primary homes are equal to Total homes, it indicates an assumption of 100 per cent primary set
usage for that platform. Australia’s Pay TV penetration remains well below the global average of 63% in 2015. Pay TV
penetration in Australia is 35%, meaning there is still plenty of room for growth, if operators can persuade consumers
to take their services rather than one of the growing number of FTA and OTT TV services.

AUSTRALIAN HOME ENTERTAINMENT DISTRIBUTORS ASSOCIATION Yearbook 201539

Australian Digital Video
Market in 2015
Australia: Total filmed entertainment industry consumer spending split by segments, 2015 + 2019 (Fixed exchange rate)

100
90
80
70
60
50
40
30
20
10
0

Netherlands
South Korea
Belgium
Slov akia
Denmark
Switzerland
Romania
India
NorwayLatv ia
Hong Kong
Estonia
Finland
USA
CanadaPortugal
SwedenHungary
PolandFranceMalta
Argentina
Belarus
IrelandJapan
Bulgaria
China
IsraelRussiaUAE
Slov enia
Macedonia
Malay sia
MexicoSerbiaSingapore
UK
Luxembourg
Armenia
Lithuania
Germany
Chile
New Zealand
Croatia
GeorgiaSouth Af rica
Austria
Cy prusThailandCzech Republic
Australia
Italy
BrazilSaudi Arabia
Spain
TurkeyGreeceUkraineMoldov a
Lebanon
Liby aIndonesia
Sy riaAlgeria
MoroccoTunisia
Egy ptPrimary Pay TV Penetration (%)

Source IHS © 2016 IHS

Local FTA TV broadcasters Seven Network, Nine Network and Network Ten produce and distribute their programming
via ad-based free catch-up and live services, which are popular in Australia and add further competition for onlinevideo subscription services and pay TV operators alike. Seven Network introduced a new FTA digital TV channel, 7flix
on 28 February 2016. Alongside existing channels Seven, 7TWO, 7mate and racing.com, 7flix is also available forstreaming on digital platforms. The general entertainment channel targets young audiences with a line-up of US movies
and first-run US series. The new channel will incur little to no cost by showing content Seven already owns includingshows from Walt Disney and NBC.
Nine launched lifestyle channel, 9Life in November 2015 amid declining advertising revenue. IHS anticipates the
network to deliver increased revenue in 2016, largely driven by the new channel.
Meanwhile, Network Ten’s business has gradually gained momentum helped by the success of its advertising sales
partnership with Foxtel’s advertising sales arm Multi Channel Network (MCN). MCN was appointed sales representativeof Ten’s television and digital inventory after Foxtel acquired 15.0% of the then struggling Ten in June 2015.
As commercial FTA TV broadcasters are increasingly competing with not just themselves, but also OTT and Pay
TV operators, it is imperative that they diversify their services to follow the increasingly digitally savvy eyeballs of
consumers. By exploiting existing video content, Seven hopes to get a piece of the online video revenue pie and offset
its dwindling FTA TV advertising income. TV services.
Similarly, Network Nine now operates four FTA digital channels, i.e. Nine, 9Gem, 9Go! and 9Life, in response to theshift of ad dollars from TV to online.

AUSTRALIAN HOME ENTERTAINMENT DISTRIBUTORS ASSOCIATION Yearbook 201540

Australian Digital Video
Market in 2015
Conclusion
Australian consumer spending on digital video, whether via Pay TV VoD, digital retail, digital rental or digital
subscription, grew rapidly in 2015 to help record double-digit growth of 49% to nearly A$395 million. IHS expects
the strong growth to continue over the forecast period with the value of the Australian digital video market forecast toreach A$1.1 billion in 2019.
Australians are showing an increasing appetite for digital video services as digital transactions per capita are close to
those in the UK and US and already above those in other major European territories. In 2015, Australia recorded strong
growth in digital retail transactions, rising 9.4% compared with a year earlier whilst combined Pay TV VoD and digitalrental transactions rose 12.8% over the same period.
The digital video sector will continue to grow on the back of improving broadband infrastructure, an increasing numberof different connected devices, and a range of new offers and services from existing players. However, no single
channel is likely to become the default, ubiquitous method for consumers to access video content as DVD once was,but rather all the video platforms will compete, and more importantly co-exist for the near future.
IHS expects the upturn in spending on digital video to compensate for the inevitable decline in buying and renting
DVDs and Blu-ray Discs over the forecast period. Blu-ray Discs will also maintain the presence of physical video inAustralia, albeit one that is largely cannibalistic of the incumbent DVD format.
Overall, IHS analysis indicates that Australian consumer spending on video (physical and digital) will maintain growththroughout the forecast period with the market in 2019 being valued at A$1.82 billion, an increase of nearly 21% from2015.

AUSTRALIAN HOME ENTERTAINMENT DISTRIBUTORS ASSOCIATION Yearbook 201541

Australian consumer spending
on digital video, whether via
Pay TV VoD, digital retail, digitalrental or digital subscription,
grew rapidly in 2015 to help
record double-digit growth of
49% to nearly A$395 million.
IHS expects the strong growth tocontinue over the forecast periodwith the value of the Australian
digital video market forecast toreach A$1.1 billion in 2019.

AUSTRALIAN HOME ENTERTAINMENT DISTRIBUTORS ASSOCIATION Yearbook 201542

Physical Retail HomeEntertainment Market
Physical vs. Digital
Data and analysis in this chapter comes from GfK retail tracking and ConsumerScope research provided by GfK to
AHEDA. The home video entertainment market offers a wider range of choice to consumers than ever before. You canwatch your favourite shows or movies on a disc, rent it from a store or watch it digitally. In 2015, the big change to theAustralian landscape was the launch of new streaming services such as Netflix, Stan and Presto.
Over the course of 2015, 96 million units were rented or purchased either physically or digitally, for a total value of $1.2
billion. This excludes the extra value added into the market from those newer streaming services. The digital channel
was the key mover, accounting for 34% of all volume (excluding piracy), though physical purchase still generates the
majority of value at 78% in 2015.
GfK ConsumerScope: Household Penetraion Q4 2015
Units Share %

100%
90%
80%
70%
60%

25%
16%

29%
15%

Value Share %
12%
7%

34%

30%

59%

81%
56%

20%

17%

6%

5%

79%

78%

13%

50%
40%

15%

53%

Digital (EST+VOD)
Rental (physical)

10%

Retail (physical)

0%
2013

2014

2015

2013

2014

2015

Note: Data factored to 100%

Though not represented above, piracy also saw some key changes in 2015 following the launch of the new streaming
services, as well as some key government initiatives that aim to help curb piracy. For more information on this, read the
GfK chapter on consumer digital trends.

Historical Trends
The physical disc retail market generated $904 million in value in 2015, making it the largest of the video homeentertainment markets. The market has shown a downward trend since its peak in 2009 as consumers have diversified
the way they watch their video entertainment content.

AUSTRALIAN HOME ENTERTAINMENT DISTRIBUTORS ASSOCIATION Yearbook 201543

Physical Retail HomeEntertainment Market
$1.50
$1.00
$0.50
$0.00

Total Value
Total Units$0.22 $0.27

$0.50

$0.71

$0.94 $0.95

$1.06

$1.26

$1.35 $1.39$1.24 $1.29$1.15 $1.09

100$0.98 $0.90 80
60

Millions

Billions

GfK Retail Tracking: Physical Retail Market size

40
20
0

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

GfK Retail Tracking: Physical Retail Market Value by Format

Billions

$1.50

$1.00

Blue Ray$0.1 $0.2

VHS

$0.50

$0.00

$0.1

DVD

$0.6

$0.4
$0.1
$0.2 $0.2 $0.2 $0.1

$0.9 $0.9 $1.1

$1.3 $1.3 $1.3 $1.1
$1.1

$0.2 $0.2

$0.1

$0.1

$1.0 $0.9$0.9 $0.8

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

Current Trends
In 2015, the physical DVD and Blu-ray retail channel sold over 50 million discs, for a total value of $904 million. This
represented a drop of 8% in value, though the rate of decline actually slowed from the -10% recorded in 2014.
The volume in the market was more stable, showing a 6% decline, with market prices dropping slightly in 2015
following a slew of cheaper blockbuster movie releases.
There were some big movie releases in 2015 and it doesn’t get any bigger than the dinosaur epic, Jurassic World.
Jurassic World was the top selling title for the year, leading the way for Universal who registered the top 3 titles for theyear.

AUSTRALIAN HOME ENTERTAINMENT DISTRIBUTORS ASSOCIATION Yearbook 201544

Physical Retail HomeEntertainment Market
GfK Retail Tracking: Top selling titles, Full Year 2015, ranked by volume

RANK TITLE
DISTRIBUTOR
GENRE____________________________________________________________________________________
1

Jurassic World

Universal

Adventure

2

Fast & Furious 7

Universal

Action3

Fifty Shades of Grey

Universal

Drama

4

Minions

Universal

Animated

6

Game of Thrones Season 4

Roadshow

Tv Drama

7

Hobbit The Battle of The Five Armies

Roadshow

Adventure

8

Hunger Games Mockingjay Part 1

Roadshow

Action9

Pitch Perfect 2

Universal

Comedy10
Inside Out (2015)
Walt Disney Studios
Animated____________________________________________________________________________________
Source: GfK Retail Tracking

Ranked by value, the latest Game of Thrones series – season 4 – was the top title, keeping up the trend of great
success for the HBO franchise.

GfK Retail Tracking: Top selling titles, Full Year 2015, ranked by value

RANK TITLE
DISTRIBUTOR
GENRE____________________________________________________________________________________
1

Game of Thrones Season 4

Roadshow

Tv Drama

2

Jurassic World

Universal

Adventure

3

Fast & Furious 7

Universal

Action4

Marvel The Avengers Age of Ultron

Walt Disney Studios

Adventure5

Hobbit The Battle of The Five Armies

Roadshow

Adventure

6

Fifty Shades of Grey

Universal

Drama

7

Big Hero 6

Walt Disney Studios

Animated

8

Inside Out (2015)

Walt Disney Studios

Animated9

Minions

Universal

Animated

10
Pitch Perfect 2
Universal
Comedy____________________________________________________________________________________

Seasonality
The seasonality within the physical retail channel is led by big events, with a key focus on the Christmas period. The
Q4 period generates the largest share of any quarter, at 29% of the 2015 volume, though that represented the lowest
share for that period in the last 6 years. Conversely, the Q3 period actually recorded its highest volume share at 25%.

AUSTRALIAN HOME ENTERTAINMENT DISTRIBUTORS ASSOCIATION Yearbook 201545

Physical Retail HomeEntertainment Market
GfK Retail Tracking: Market Seasonality by Quarter - Volume Shares
2010

22%

23%

24%

31%

2011

21%

22%

24%

33%

2012

22%

22%

24%

32%

2013

22%

24%

22%

32%

2014

24%

23%

24%

30%

2015

23%

22%

25%

29%

0%

10%

20%

30%

Quarter 1

40%

50%

Quarter 2

60%

70%

Quarter 3

80%

90%

100%

Quarter 4

GfK Retail Tracking: Market Seasonality by Quarter - Value Shares

2010

22%

22%

23%

33%

2011

21%

21%

23%

36%

2012

22%

21%

23%

34%

2013

22%

23%

22%

34%

2014

23%

22%

23%

31%

2015

23%

22%

24%

31%

0%

10%

20%

30%

Quarter 1

40%

50%

Quarter 2

60%

70%

Quarter 3

80%

90%

100%

Quarter 4

When split by month, the key change was within September, with 10% of the market volume being sold in that month.
While the rest of the months all declined in volume and value compared to 2014, September grew by 10% in volume
and 3% in value, with some key new releases in that month, led by Disney’s Marvel Avengers: The Age of Ultron.
December still remains the critical month for the Video Entertainment market, generating 15% of 2015’s volume sales,
and 17% of the value.
GfK Retail Tracking: Market Seasonality by Month - Volume Shares
2010

9%

8%

8%

7%

6%

9%

7%

8%

9%

7%

8%

17%

2011

8%

6%

8%

7%

6%

9%

8%

7%

9%

7%

8%

18%

2012

8%

6%

9%

6%

7%

8%

8%

7%

9%

7%

7%

17%

2013

8%

5%

8%

8%

7%

9%

8%

6%

8%

7%

9%

16%

2014

9%

6%

9%

7%

8%

8%

9%

7%

8%

6% 7%

16%

2015

8%

5%

8%

7%

7%

9%

9%

7%

10%

7%

7%

15%

30%

40%

50%

80%

90%

0%
Jan

Feb

10%
Mar

20%
Apr

May

Jun

Jul

60%
Aug

70%
Sep

Oct

Nov

100%
Dec

AUSTRALIAN HOME ENTERTAINMENT DISTRIBUTORS ASSOCIATION Yearbook 201546

Physical Retail HomeEntertainment Market
GfK Retail Tracking: Market Seasonality by Month - Value Shares
2010

8%

6%

8%

8%

6%

8%

7%

2011

8%

6%

8%

7% 6%

8%

7%

7%

9%

2012

8%

6%

8%

6%

7%

8%

7%

7%

9%

2013

8%

5%

9%

7%

7%

8%

7%

2014

8%

6%

9%

7%

8%

8%

8%

2015

8%

6%

8%

7%

7%

8%

7%

30%

40%

0%
Jan

10%

Feb

Mar

20%
Apr

May

6%
7%
7%

50%

Jun

Jul

8%

18%

9%

20%

7%

8%

19%

9%

7%

9%

18%

9%

7%

7%

17%

10%

7%

8%

17%

70%

80%

90%

7%

9%

7%

7%

60%
Aug

Sep

Oct

Nov

100%
Dec

Format Trends
The Blu-ray format has not continued to develop like the DVD format did. Over the past 4 years, the percentage that
Blu-ray makes up of the total market value has been stable, sitting at 15%.
In 2015, Blu-ray generated $133M in value, with over 6 million discs sold. Like DVD, the rate of decline for Blu-ray has
slowed in 2015 (-9% in 2015, compared to -10% in 2014). However, 2015 marked the first time Blu-ray dropped bymore than the DVD format at -9% and -7% respectively.
GfK Retail Tracking: Blu-ray Volume Sales (Millions)

6.82

7.82

7.85

6.98

6.17

3.74
0.16
2007

0.71
2008

1.79

2009

2010

2011

2012

2013

$164

$168

$162

2014

2015

GfK Retail Tracking: Blu-ray Value Sales (Millions)

$63
$6
2007

$146

$133

$95

$27
2008

2009

2010

2011

2012

2013

2014

2015

AUSTRALIAN HOME ENTERTAINMENT DISTRIBUTORS ASSOCIATION Yearbook 201547

Physical Retail HomeEntertainment Market
GfK Retail Tracking: Blu-ray percentage of market

20%
15

15%
10%
5%

13
10

8
6

15
13

12

15
13

15
Value

12

Volume

0%
2010

2011

2012

2013

2014

2015

One of the key reasons for that drop in Blu-ray was a softening of the Blu-ray share within both New Release andCatalogue Movies.
GfK Retail Tracking: Blu-ray Value Share % of each Release Type

28% 27%201326%

24% 23%

2014

22%

2015

New Release Movies

Catalogue Movies

7%
5% 6%

7% 8% 8%

TV Series

Other Direct to Video

Case study: What is holding back the Blu-ray format?
A key question for the Blu-ray format is why do consumers choose to purchase a DVD, even though they own thenecessary Blu-ray hardware? From the GfK ConsumerScope measurement, the three main reasons stated are related
to quality, pricing and availability.

AUSTRALIAN HOME ENTERTAINMENT DISTRIBUTORS ASSOCIATION Yearbook 201548

Physical Retail HomeEntertainment Market
GfK ConsumerScope Q4 2015: Why did you purchase a DVD when you own Blu-ray equipment?

DVD quality is good enough47%

Too expensive

29%

Title wasn't available as Blu-ray disc26%
8%

Other (Please specify)
Don't know the difference between
DVD and Bluray
Don't know what Blu-ray is5%1%
0% 5% 10%15% 20% 25% 30% 35%40%45% 50%

The higher quality of Blu-ray for both picture and audio is something that can be communicated and demonstrated.
High definition TV channels have become the norm for both free-to-air and pay TV, highlighting the use and interest in
higher quality content.
Whilst availability is cited as a reason, 90% of the top 500 models selling in 2015 had a Bluray release. However, oneof the main differences for availability is within TV Series, with just 14% of TV titles released in 2015 being offered on
Blu-ray. This may be a factor in why TV Series represents 39% of DVD value, but just 17% of Blu-ray.
GfK Retail Tracking: Category Performance by Format - 2015 Value %

OTHER
7%
26%

6%
39%

CHILDRENS

48%

17%

TV SERIESFILM (inc. Animated)

63%

9%

88%

79%

MUSIC
DOCUMENTARY

DVD Units

DVD Value

Blu-ray Units

Blu-ray Value

AUSTRALIAN HOME ENTERTAINMENT DISTRIBUTORS ASSOCIATION Yearbook 201549

Physical Retail HomeEntertainment Market
The final key reason listed is pricing. Blu-ray titles cost more than DVD and for some consumers the price premium is
not worth the upgrade. This was evident in New Release Movies, where the price premium for Blu-ray has increased inrecent years. In 2015, New Release Movies cost 41% more on Blu-ray than DVD, the highest premium since 2011. It is
important to note that this is not due to rising Blu-ray prices, but rather a fall in DVD prices, which has stretched thegap between the two formats. From the GfK ConsumerScope service, consumers say they are willing to pay a 25%
premium for the Blu-ray format1.
GfK Retail Tracking: New Release Movies - Price premium for Blu-ray

43%
35%

35%

2012

2013

41%

39%

29%

2010
1

2011

2014

2015

GfK ConsumerScope: Base = Disc buyers in Q4 2015 (Amongst those willing to pay).

GfK Retail Tracking: Top selling DVD titles, Full Year 2015, ranked by volume
RANK TITLE
DISTRIBUTOR
GENRE____________________________________________________________________________________
1

Fast & Furious 7

Universal

Action2

Jurassic World

Universal

Adventure

3

Fifty Shades of Grey

Universal

Drama

4

Minions

Universal

Animated

5

Pitch Perfect 2

Universal

Comedy6Inside Out (2015) Walt DisneyStudios

Animated

7

Game of Thrones Season 4

Roadshow

TV Drama

8

Big Hero 6 Walt DisneyStudios

Animated

9

Marvel The Avengers Age of Ultron

Walt Disney Studios

Adventure

10
Hunger Games Mockingjay Part 1
Roadshow
Action____________________________________________________________________________________

AUSTRALIAN HOME ENTERTAINMENT DISTRIBUTORS ASSOCIATION Yearbook 201550

Physical Retail HomeEntertainment Market
GfK Retail Tracking: Top selling Blu-ray titles, Full Year 2015, ranked by volume
RANK TITLE
DISTRIBUTOR
GENRE____________________________________________________________________________________
1

Hobbit The Battle of The Five Armies

Roadshow

Adventure2

Marvel The Avengers Age of Ultron

Walt Disney Studios

Adventure3

Jurassic World

Universal

Adventure

4

Mad Max Fury Road

Roadshow

Action5

Fast & Furious 7

Universal

Action6

Hunger Games Mockingjay Part 1

Roadshow

Action7

Fury (2014)

Sony Pictures

War

8

Game Of Thrones Season 4

Roadshow

TV Drama

9

American Sniper

Roadshow

Action10Interstellar
Roadshow
Sci-Fi____________________________________________________________________________________
Sales of 3D titles are also included within Blu-ray. 3D is a smaller section of the total market, but accounts for 10% of
Blu-ray sales units. Most of the 3D volume came via Live-Action movies, with the latest Hobbit release, Battle of theFive Armies, being the top seller.
GfK Retail Tracking: Top selling 3D Blu-ray titles, Full Year 2015, ranked by volume
RANK TITLE
DISTRIBUTOR
GENRE____________________________________________________________________________________
1

Hobbit The Battle Of The Five Armies

Roadshow

Adventure2

upiter Ascending

Roadshow

Action3

Mad Max Fury Road

Roadshow

Action4

Jurassic World

Universal

Adventure

5

Marvel The Avengers Age Of Ultron

Walt Disney Studios

Adventure

6

San Andreas

Roadshow

Action7

Terminator Genisys

Paramount

Action8

Avatar (2009) 20Th

Century Fox

Sci-Fi9

Ant-ManWalt Disney Studios

Adventure

10
Jurassic Park
Universal
Adventure____________________________________________________________________________________

AUSTRALIAN HOME ENTERTAINMENT DISTRIBUTORS ASSOCIATION Yearbook 2015
51

4

e

2
2015 Tope d b y v olu

m

Ra

nk

ned
mbi
co

VD + Blu-ray
0D

e

5

e d b y v olu

m2
2015 Top

Ra

nk

ned
mbi
co

VD + Blu-ray
0D

e

6

e d b y v olu

m

e

7

e d b y v olu

m

2

Ra

nk

ned
mbi
co

VD + Blu-ray
0D2015 Top

2
2015 Top

Ra

nk

ned
mbi
co

VD + Blu-ray
0D

AUSTRALIAN HOME ENTERTAINMENT DISTRIBUTORS ASSOCIATION Yearbook 201552

Consumer Behaviour
The data for this chapter is taken primarily from the GfK ConsumerScope survey, an online syndicated survey into
video entertainment. The survey is conducted continuously throughout the year amongst approximately 3,000
Australians aged 14 to 65 years per quarter.

Home entertainment consumption trends
In 2015 there were significant changes in the Australian home entertainment market. Most notably, the rise of
SVOD (Subscription Video on Demand), a steep decline in piracy, and the increased use of connected devices (e.g.
Chromecast, Apple TV and Smart TVs).   
Physical discs remain a very important format in the home entertainment market.  After free-to-air TV, physical discs
have a high penetration, with half (51%) of the population aged 14-65 years having watched a DVD or Blu-ray disc in
the past month.
Digital content (EST1, VOD2, SVOD, piracy, catch-up TV) is also very significant in the home entertainment market.  
Over half (54%) of Australians have consumed digital home entertainment in the past month and 30% have watchedpaid digital (EST, VOD or SVOD) in the past month.   
GfK ConsumerScope: Last month consumption incidence in Q4 2015 (%)

81

F2A TV45

DVD disc
Pay TV

32

CUTV

30
51% Total disc

23

SVOD
Blu-ray disc20

Total piracy

20

VOD

10

EST

9

30% Total paid digital

Source: GfK ConsumerScope (Q4’2015) Which of the following have you watched in the last month?
Base: Total sample aged 14-65 years (n=3,231)

AUSTRALIAN HOME ENTERTAINMENT DISTRIBUTORS ASSOCIATION Yearbook 201553

Consumer Behaviour
The viewing of paid digital content has increased significantly during 2015 (up from 19% in Q4 2014 to 30% in
Q4 2015). Much of this growth is due to the early 2015 arrival of key SVOD providers in Australia: with last monthconsumption of SVOD increasing from 8% at the end of 2014 to 23% at the end of 2015. In just a single year SVOD
has increased the paid digital category by 50% and introduced an additional 11% of the population to the paid digital
category.
With the rise of SVOD there has been an accompanying decline in other formats: a drop in last month consumption ofDVDs (from 52% to 45% in the past year), and a very significant decline in last month consumption of pirated content(from 31% to 20%). Last month consumption of Blu-ray, EST and VOD were stable across the year.
GfK ConsumerScope: Last month consumption over time60
DVD disc

52

50

45
40
30
20

0

Q2 2014

Q3 2014

CUTV

34
31
30

32

SVOD

30
23

Blu-ray

22

20

10
8

10

Pay TVQ4 2014

9

Q1 2015

Q2 2015

Q3 201520
9

Total piracy
VOD
EST

Q4 2015

Source: GfK ConsumerScope Which of the following have you watched in the last month?
Base: Total sample aged 14-65 years  (n= 3,000 – 6,000 per quarter)

Despite an overall decline, discs continue to be the home entertainment format with the highest penetration in every
age group. Australians aged 18-24 years of age are home entertainment fans, being the most likely to have watchedeach format in the past month. The likelihood of watching digital formats drops off quite steeply from 35 years of age.  

AUSTRALIAN HOME ENTERTAINMENT DISTRIBUTORS ASSOCIATION Yearbook 201554

Consumer Behaviour
GfK ConsumerScope: Last month use of format by age$70$60

DVD disc58

Blu-ray disc

$50
$40
$30
$20
$10
$0

37
30
26
20

VOD
SVOD

12 12

14-17

EST

12

18-24

25-34

35-44

45-54

Source: GfK ConsumerScope  Which of the following have you watched in the last month?
Base: Total sample aged 14-65 years YE Q4 2015  (n= 13,047)

6 6
3 2
55-65

Total piracy

Overall, the number of home entertainment titles viewed in these formats has declined in the past year (from 7.5 to 7.1
titles per month), with the decline driven by the significant drop in piracy (down from 3.9 to 2.6 titles per month) notquite offset by the increase in SVOD (up from 0.6 to 1.8 titles per month).    
With the rise of SVOD there has been an accompanying decline in other formats: a drop in last month consumption ofDVDs (from 52% to 45% in the past year), and a very significant decline in last month consumption of pirated content(from 31% to 20%).  Last month consumption of Blu-ray, EST and VOD were stable across the year.
GfK ConsumerScope: Average number of titles bought/acquired in last month by format
8.0

7.5

7.1

0.6

7.0

0.3
0.3

6.0

1.8

0.9
0.4
0.3

5.0
1.4

1.2

4.0

2.0

3.9
2.2

1.0
0

1.2

1.7

3.0

2.6

2014

SVOD
VOD
EST
Disc rental
Disc purchase

0.9

Indirect piracy

1.7

Direct piracy

2015

AUSTRALIAN HOME ENTERTAINMENT DISTRIBUTORS ASSOCIATION Yearbook 201555

Consumer Behaviour
Source: GfK ConsumerScope (2014 and 2015)
Base: Total sample aged 14-65 years (2014: n=6,876, 2015:n=9,457)
Note that direct piracy refers to pirated content that is downloaded/streamed directly from the internet. Indirect piracy refers to pirated content thathas been copied from others (e.g. via USB, hard drive).

Disc rental
Across all formats, disc rental has shown the greatest decline. In the last four years, the proportion of the population
who has rented a disc in the past month has nearly halved (from 34% in Q4 2011 to 18% in Q4 2015). The decline inrental has been driven by DVD rental, while Blu-ray disc rental is holding steady.
GfK ConsumerScope: Incidence of past month disc rental

40%
35%

34

30%

32

25%

27
25

20%

21

20

20

19

15%
10%
5%
0%

9

9

11

9

18
17
9

NETT disc rental
DVD disc rental
Blu-ray disc rental

Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q42011 2012 2012 2012 2012 2013 2013 2013 2013 2014 2014 2014 2014 2015 2015 2015 2015

Source: GfK ConsumerScope
Base: Total sample aged 14-65 years (n= 3,000 to 6,000 per quarter)

However, there are still some opportunities in the disc rental sector: while rental stores continue to hold the majorityof the disc rental market, they are in decline (60% in Q2 2015, down from 85% in Q3 2011), but rental kiosks are
increasing in share (21% in Q2 2015, up from 4% in Q3 2011).

AUSTRALIAN HOME ENTERTAINMENT DISTRIBUTORS ASSOCIATION Yearbook 201556

Consumer Behaviour
VOD and EST
Penetration of paid VOD and EST is approximately equal. In Q4 2015 9% of the population consumed EST in the pastmonth and 10% consumed VOD. There is opportunity to grow these individual markets as they have two different
targets with little cross-over: 14% have consumed EST or VOD in the past month but only one quarter of these (4%of the total population) have consumed both. Part of the reason for these two separate markets is that Foxtel, the key
supplier of paid VOD via its Box Office/Rental Store, doesn’t offer EST.   
GfK ConsumerScope: Consumption of EST and VOD
14%
EST (9%)

EST
only
5%

VOD (10%)

Both
4%

VOD
only
6%

Source: GfK ConsumerScope (Q4’2015)
Base: Total sample aged 14-65 years (n=3,231)

While physical discs still dominate the paid home entertainment market, transactional digital is becoming more
important and needs to fill any future gaps.   GfK ConsumerScope has found that the key barriers to shift totransactional digital include:
1.

Price – in particular, the perception that EST is expensive compared to VOD and physical discs.

2.

Piracy – although piracy declined in 2015.

3.

Difficulty displaying digital content on TV – TV is the preferred display to watch all formats and this difficultywith digital is the 2nd strongest driver for purchasing a disc instead of EST.
- The increasing penetration of smart TVs and media players (to 41% of the population) is likely to significantly		 reduce this barrier and increase paid digital consumption.3
4.

Low datacaps and slow internet speeds in Australia4 are a barrier to downloading EST and streaming (non-		
Foxtel) VOD.

5.

The importance of a physical collection – large disc collections are common and collectability is a very strong 		reason for buying a disc rather than EST. 5

AUSTRALIAN HOME ENTERTAINMENT DISTRIBUTORS ASSOCIATION Yearbook 201557

Consumer Behaviour
Catch-up TV
Free-to-air catch-up TV services are being accessed at least monthly by one third of the population. Monthly
consumption of catch-up TV has grown significantly from 18% of the population in Q2 2011, to a peak of 35% of
the population in Q2 2014.  Despite some upgrades to platforms and new digital channels on catch-up TV, since thelaunch of Netflix in Australia the catch-up TV monthly incidence has dropped off (to 30% in Q4 2015).
Catch-up TV has been a very good way of introducing digital home entertainment to the population. In the past, catchup TV was primarily watched on a computer.  However, since the launch of Netflix (and the accompanying rise in TV
connectivity) consumers are increasingly viewing catch-up TV   on a television (from 34% viewing on TV in Q1 2015, to
43% viewing on TV in Q3 2015).

PiracyPiracy is a common source of home entertainment acquisition in Australia. Piracy of video entertainment takes
two forms: direct piracy where pirates download/stream content directly from the internet; and indirect piracy
where consumers obtain copied pirated content from others (e.g. via USB, or hard drive).
GfK ConsumerScope data shows that in 2015 there was a very steep decline in piracy levels.  In Q4 2014, one in three(31%) Australians aged 14-65 years had pirated video content (directly or indirectly) in the past month. A year later (inQ4 2015), piracy had declined to only one in five (20%) Australians pirating in the past month.  
There is a similar pattern in the number of titles that have been pirated each month: a steep decline between Q4 2014
and Q3 2015 (from 4.0 titles to 2.1 titles per person) with a slight increase between Q3 and Q4 2015 (up to 2.4 titles).
GfK ConsumerScope: Last month piracy6 consumption incidence and number of pirated titles acquired
10.0

35

34

34

30

9.0
31

8.0

30

7.0

25

6.0
21

20
15

3.7

3.7

4.0

19

20

4.0

3.4
2.4

10

2.1

2.4

5
0

5.0
3.0
2.0
1.0

Q2 2014

Q3 2014

Q4 2014

Q1 2015

Q2 2015

Q3 2015

Q4 2015

No. of jtles% Viewership in the past month40% consumed
piratedcontent
No. ofpirated titles
last month0

Source: GfK ConsumerScope Which of the following have you watched in the last month?…pirated from the internet / copied titles from someone
else (e.g. via USB, hard drive) (shared pirated content)?  Thinking about the last month, how many titles have you personally…pirated from theinternet / copied titles from someone else (e.g. via USB, hard drive) (shared pirated content)?
Base: Total sample (n= 3,000 to 6,000 per quarter)

AUSTRALIAN HOME ENTERTAINMENT DISTRIBUTORS ASSOCIATION Yearbook 201558

Consumer Behaviour
In Q2 2015 (following the launch of Netflix), the number of paid digital titles acquired in the past month exceeded thenumber of pirated titles for the first time ever.  At the end of 2015, the number of paid digital titles acquired (3.1) was
significantly above the number of pirated titles (2.4) but the gap is starting to narrow.
GfK ConsumerScope: No. of pirated7 titles vs. paid digital titles acquired in the past month (volume)
4.0
3.5
3.7

3.7

3.0

4.0
3.4

2.5

2.5
2.4

2.0

3.0

3.1
2.4

2.1

1.5
1.4

1.0

1.2

1.1

Q3 2014

Q4 2014

Paid Digital(EST,VOD, SVOD)

1.4

Piracy0.5
0.0

Q2 2014

Q1 2015

Q2 2015

Q3 2015

Q4 2015

Source: GfK ConsumerScope Thinking about the last month How many titles have you personally…pirated from the internet / copied titles fromsomeone else (e.g. via USB, hard drive) (shared pirated content)?
Base: Total sample (n=approx.. 3,000 to 6,000 per quarter)

In just nine months, piracy has shifted from comprising almost half (45%) of home entertainment (excluding free-to-air
and pay TV) acquisition volume, to less than one third (29%). In Q4 2015 discs actually increased in volume share (aspiracy and SVOD dropped off slightly).
GfK ConsumerScope: Piracy volume share

100%
80%
60%
40%

36%

24%

29%
Non-digital volume+

18%

33%

46%

20%
0%

35%

Q1 2015

40%

32%

36%

Q2 2015

Q3 2015

38%

Paid digital volume*

33%

Pirated digital
volume#Q4 2015

Source: GfK ConsumerScope Thinking about the last month How many titles have you personally…pirated from the internet / copied titles fromsomeone else (e.g. via USB, hard drive) (shared pirated content)?
Base: Total sample (n=approx. 3,000 per quarter)+ Disc purchase and rental, * SVOD, VOD, EST, # Direct and Indirect piracy

AUSTRALIAN HOME ENTERTAINMENT DISTRIBUTORS ASSOCIATION Yearbook 201559

Consumer Behaviour
Home entertainment pirates are most likely to be males (24% of males have pirated in the past month vs. 21% offemales), and those aged 14-34. While piracy declined among all age groups, the greatest decline was reported for
14-17 year olds (from 51% to 29%).
GfK ConsumerScope: Incidence of last month piracy by age (%)
60
50

52

51

30

43

43

40

33

29

27

20

2014

19

17

10
0

14-17

18-24

25-34

35-44

12

11

45-54

55-65

2015

7

Source: GfK ConsumerScope  Which of the following have you watched in the last month?
Base: Total sample aged 14-65 years (2014 n=25,632; 2015 n=18,278)

Pirates are more heavily involved than non-pirates in all video entertainment formats (with the exception of free-to-airTV). In particular, pirates are much more likely than non-pirates to have watched EST, VOD, SVOD or YouTube content
in the past month. For example, significantly more pirates (18%) than non-pirates (7%) watched content on VOD or
EST in the past month.
GfK ConsumerScope: Last month viewing of format – pirates vs. non-pirates
100%

80%

79% 82%60%

Pirates n=598

77%
49% 52%

Non-pirates n=2633
43%

40%

47%
32%

38%

39%
30%

27%

20%
0%

F2A TV

YouTube DVD disc Something Pay TV
videosin a cinema

CUTV

34%
20%

27%

19% 18%

18%

7%

7%

SVOD Blu-ray disc VOD

ESTSource: GfK ConsumerScope  Which of the following have you watched in the last month?
Base: Total sample Q4 2015 (n=3,231)* The multiple of how much more likely pirates are to use each platform. (eg. pirates are 2.7 times more likely than non-pirates to have watched ESTin the past month).

The steep decline in piracy in 2015 is likely to be due to a combination of two key factors: the introduction of Australian
Netflix in March 2015 and legal deterrents.

AUSTRALIAN HOME ENTERTAINMENT DISTRIBUTORS ASSOCIATION Yearbook 201560

Consumer Behaviour
The launch of Australian Netflix
The launch of Netflix in Q2 2015 appears to have substantially influenced the recent decline in piracy. Since Q1 2015,
SVOD consumption has increased from 8% to 23%, as piracy declined from 30% to 20%.
GfK ConsumerScope: Last month use of piracy, SVOD and paid digital
40
35

34

Introduction of Netflix inAustralia (March 2015)

34

31

30

30

30

20
17

19

19

18

8

8

8

Q3 2014

Q4 2014

Q1 2015

10
5
0

30

26

25

15

Piracy6

Q2 2014

21

22

19

19

23
20

Paid digital(EST/VOD/SVOD*)SVOD

Q2 2015

Q3 20156310
6539of the following
6289 have you
3433
2972
Source: GfK ConsumerScope  Which
watched in3456
the last month?
Base: Total sample aged 14-65 years (2014 n=25,632; 2015 n=18,278)

Q4 20153231

GfK ConsumerScope data has found that most SVOD subscribers who have pirated in the past year say thathaving an SVOD subscription already has (24%), or definitely/probably will (47%), reduce their piracy.  Some pirates
specifically admit that the reason they have reduced their piracy is because of Netflix.

I'm planning to get Netflix andstop downloading soon. There
wasn't enough competition to
be able to afford these services
before.

I do pirate less now since the releaseof Netflix in Australia. I no longer pirate
at allIt already has. Netflix. Allows
me unlimited streaming and
I'm paying very little permonth. It's like an "all you
can eat buffet”
Since Netflix Australia hascome out, I have been
pirating less as is a great
deal.

Stop downloads I guess. But wehave just signed up to Netflix so
may slow down a lot once we
get into this more.
Source: GfK ConsumerScope  What would have to change to get you to pirate less and purchase more?
Base: SVOD subscribers who have pirated in past year (Q2 2015)

AUSTRALIAN HOME ENTERTAINMENT DISTRIBUTORS ASSOCIATION Yearbook 201561

Consumer Behaviour
Legal deterrents
In 2015 a number of Australian legislative initiatives were proposed to combat piracy.
1.

The introduction of Australia’s voluntary ISP industry agreement and its three strikes legislation for illegitimate 		downloading of content (Copyright Notice Scheme Code 2015).

2.

The Site Blocking [Copyright Online Infringement Bill 2015].

3.

The Australian Federal Court ruling that the contact details of 4,700 people who shared Dallas Buyers Club
would be provided to the film studio.

These legal deterrents are likely to have worked to discourage some pirates fromaccessing unlicensed content. The GfK ConsumerScope survey found that concerns overlegal issues have increased, at the time of greatest publicity for the initiatives, as a reason
for pirates to limit their piracy (up from 25% in Q4 2014 to 36% in Q2 2015). There wasstrong awareness of the three strikes legislation (54%) and the Dallas Buyers Club legal
action (62%) among the total population, and these initiatives stopped/reduced piracy
among 53% of those aware of the initiatives who had pirated in the past year.

“Pirating is
becoming
more risky”“I am already
reducing piracy
due to fearof legalramifications”

The four key reasons for piracy are cost, early content availability, ease of access and the perception that piracy isn’t
wrong.
In 2015 many of these motivations for piracy were reduced.
1.

Cost of content declined – good value for money SVOD services were introduced and the price of EST and 		discs are declining.

2.

Earlier availability of content - TV shows are being fast tracked and studios appear to be experimenting with 		windowing at different stages of the title’s lifecycle.

3.

Easier access to content on TV - SVOD is enabling easier TV access to online content (eg. TV apps,
Chromecast, Apple TV).

4.

Education - the recent legal deterrents appear to have had an impact amongst some pirates.

However, we are seeing an indication that piracy may start to rebound as the novelty of SVOD potentially starts
wearing off and/or the legal initiatives appear less dangerous.

AUSTRALIAN HOME ENTERTAINMENT DISTRIBUTORS ASSOCIATION Yearbook 201562

Consumer Behaviour
SVOD
The most significant change to the home entertainment market over the course of 2015 has been the rise of SVOD
(e.g. Netflix, Quickflix Play, Foxtel Play, Presto). Monthly consumption has increased from 8% in Q4 2014 to 23% (ornearly 1 in 4) in Q4 2015. It also has significant volume with 2.4 titles being watched in the past month. SVOD products
are generally strong in in TV series and catalogue movies, but limited offering of newer movies.
The majority of the SVOD category growth has been driven by the launch of Netflix in March 2015; Netflix is now
watched by 19% of the population with a share of 68% of most recent SVOD title watched.
GfK ConsumerScope: Last month consumption incidence (%)

25

20

20

15

19

15

10

5
2

0

4

4

3
1

3 2
1

Q4 20146289

Q1 2015
3433

3
2

3
2

Q2 2015
3456

3

4

4

2

Q3 2015
2927

4
3 3
2

Q4 2015
3231

Source: GfK ConsumerScope PayTVNew2. Do you have, or have you had a subscription to any of the following services? - subscribe
Base: Total sample aged 14-65 years

Netflix
Netflix launched at $8.99 per month for a basic subscription up to $14.99 for the premium subscription (one of thecheapest Netflix subscriptions globally), and has maintained these price points since launch. Those people who alreadyhad an overseas Netflix subscription prior to the Australian launch were able to continue their subscription and include
the Australian content. The majority of the content currently available on Netflix in Australia is from the US or the UK,
there is very limited local Australian content.

AUSTRALIAN HOME ENTERTAINMENT DISTRIBUTORS ASSOCIATION Yearbook 201563

Consumer Behaviour
GfK ConsumerScope: Reasons to sign up to SVOD service Q4 2015 (%)

Affordable
To watch at a time that suits
Free trial
To watch multiple episodes in a row
To access a catalogue of new TV programs
To access back catalogue of TV programs
To access back catalogue of movies
To watch on multiple devices (TV, smartphone, tablet)
To watch original services produced by provider House of Cards by Netflix)
Excellent picture quality
To access a catalogue of new movie releases
Easy search functionality
To watch a specific program
Recommends titles for me to watch
To replace Pay TV
To replace discs
Bundled with another plan (Phone, internet, news)
Don’t know
Other

53▲
41▲
39▲
37▲
29▲
28▲
24▲
23▲
22▲
21▲
20▲
19▲
16
13
13▲
9
7
1▼
6

25▼
37
48
28
29
17
18
14
5
7
10
3▼
23
7
7
12
12
0
0

29
29
47
20
15
28
13
19
5▼
7
11
4▼
7
4
7
0
2
2
8

16▼
18▼
20▼
12▼
13▼
13▼
11
7▼
4▼
15
15
20
16
9
3▼
6
13
12▲
2▼

540

41

52

87

Source: GfK ConsumerScope SVOD2c Why did you sign up to SVOD provider?
Base: SVOD subscribers (Q4 2015)

Customers sign up to Netflix for a number of reasons including affordability, the free trial, ability to watch when you
want, binging of episodes and access to a catalogue of TV shows and movies. Once signed up, Netflix customers
have a very high frequency of viewing with 1 in 2 watching almost every day. Netflix’s success has been driven by anumber of factors including having highly satisfied customers (85% satisfied/very satisfied YE Q4 2015, the highest of
all of the SVOD services). Customers are satisfied with Netflix for numerous reasons including: being easy to use, goodvalue, convenient, good range of titles and good picture and sound quality. Satisfaction with Netflix over the course of2015 has not wavered.
GfK ConsumerScope: Netflix strengths in the market

The whole SVOD category is referred to as “Netflix”
WOM is bringing the SVOD category onto the radar for the masses, not just the early adopters
Original content is gaining traction
Shows such as Narcos are starting to make subscribers consider it as not only a content provider,
but a content producer
It encourages binge watching (TV shows especially)
Due to access to new and original TV content, the ability for it toremember where you left off and the continuous play feature
Kids content making it worth keeping“I was surprised by how much kids stuff is on there”
Source: GfK ConsumerScope Qualitative Q3 2015

AUSTRALIAN HOME ENTERTAINMENT DISTRIBUTORS ASSOCIATION Yearbook 201564

Consumer Behaviour
Stan
StreamCo’s Stan launched on 26 January 2015, a joint venture between Fairfax Media and Channel 9. Stan launchedwith a large marketing spend and some big titles, for example ‘Better call Saul’. However, it significantly lags behind
Netflix with 3% penetration and only a 7% share of most recent SVOD title watched in Q4 2015. There are fewer
motivations to sign up to Stan compared to Netflix. However, the free trial is clearly the main reason, indicating that afree trial is critical to encourage people to try Stan. Stan has the second highest level of satisfaction at 80%, however 1
in 10 are unlikely to continue their subscription indicating a reasonably high level of churn.

PrestoPresto launched at the beginning of 2014 with movies only ($19.99 launch price, now down to $9.99) and in early2015 added TV series to the offer in a joint venture with the Seven Network ($14.99 for TV and movies). It has a very
similar penetration as Stan at 3%. The primary motivator for signing up to Presto is its free trial, however it has lowest
level of people likely to stay and lowest level of satisfaction with the service.

Quickflix
Quickflix, despite being the longest established SVOD service, has had limited success. This is primarily due to a small
library of content, and a need to use paid VOD for any premium content. Quickflix does not seem to have benefited
from the halo effect of other SVOD providers as penetration has remained stable at around 2%.

Foxtel Play
Foxtel Play is an online (somewhat stripped-down) version of Foxtel which is available through PC/Mac, some Smart
TV and console apps. It functions in a different way to other SVOD services as it has live TV including sport, news
and reality TV, and on-demand catch-up TV, rather than an extensive library of content. Foxtel Play’s penetration has
remained stable at around 4%.
Not only have SVOD providers capitalised on the growth of the sector, but sales of connected devices (such as Smart
TVs, Apple TV, Chromecast and Telstra TV) have increased and telecommunication providers have benefited fromincreased data requirements and partnerships with SVOD providers.
Among the total population, 17% are likely or very likely to take up an SVOD service in the next 12 months. If thisoccurred, a total of 40% of the population would have an SVOD service which would be far greater than the proportionof people with a Foxtel Pay TV subscription.

AUSTRALIAN HOME ENTERTAINMENT DISTRIBUTORS ASSOCIATION Yearbook 201565

Consumer Behaviour
Netflix has seen great success in Australia in 2015, although growth has slowed recently, this does not appear to haveput off other providers from launching in Australia:•

HayU is due to launch in Australia in March 2016. It is a reality TV service from Universal which will 		
launch at $5.99 per month.

•YouTube Red (a subscription service for ad free streaming of videos and offline playback) is likely tolaunch in Australia in the future, although no timeline has been put into place as yet.

Penetration of SVOD has plateaued in Q4 2015 at 23%. There are a number of reasons that could hamper
SVOD’s further growth:•Geo-blocking may result in dissatisfaction with the content available in Australia for those who obtain 		
global SVOD content via a VPN•

Netflix had rapid growth initially, however, penetration is already plateauing, and without being able tokeep up with the content demands of customers, or people being disappointed in the lack of new movie
releases, people may stray from the service•

Having multi-screen subscriptions means that multiple people, and households, are able to share a
subscription (e.g. 4 devices can use Netflix for $14.99 per month)•

The large number of SVOD providers (and free trials) available may result in consumer swapping between
services rather than keeping a long term subscription.

Overall, SVOD has been a success so far in Australia. The data indicates the biggest impact has been on a
reduction in piracy and linear TV viewing rather than significantly impact EST, VoD or disc purchasing.
About GfK
GfK is the trusted source of relevant market and consumer information that enables its clients to make smarter
decisions. More than 13,000 market research experts combine their passion with GfK’s 80 years of data science
experience. This allows GfK to deliver vital global insights matched with local market intelligence from more than
100 countries. By using innovative technologies and data sciences, GfK turns big data into smart data, enablingits clients to improve their competitive edge and enrich consumers’ experiences and choices.
To find out more, visit www.gfk.com or follow GfK on Twitter: https://twitter.com/GfK_en

1 EST= electronic sell through (a digital purchase to keep).
2 VOD = paid video on demand/digital rental.
3 The increase in connected devices is partly in response to SVOD. For more detail on developments in TV hardware, media players and devices,
see the Hardware chapter.
4 http://www.gizmodo.com.au/2015/05/netflixs-speed-ranking-shows-us-how-broken-australias-internet-really-is/
5 Having a physical collection was the main reason for not buying EST for 52% of past month disc buyers (Q4 2015).
6 “Piracy” includes both “Direct piracy” where pirates download/stream content directly from the internet and “Indirect piracy” where consumers
7 “Piracy” includes both “Direct piracy” where pirates download/stream content directly from the internet and “Indirect piracy” where consumers
obtain copied pirated content from others (e.g. via USB, or hard drive).

AUSTRALIAN HOME ENTERTAINMENT DISTRIBUTORS ASSOCIATION Yearbook 2015
66

e

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AUSTRALIAN HOME ENTERTAINMENT DISTRIBUTORS ASSOCIATION Yearbook 2015
67

e

9

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AUSTRALIAN HOME ENTERTAINMENT DISTRIBUTORS ASSOCIATION Yearbook 2015
68

Devices and Emerging
Viewing Patterns
Data and analysis in this chapter comes from GfK retail tracking and ConsumerScope research provided by GfK to
AHEDA. There are a lot of different ways to watch your favourite home video entertainment content. Perhaps you liketo settle on your couch and watch your favourite DVD or Blu-ray on the TV, or maybe you prefer to lie in bed and watch
Netflix on your tablet. Whatever you prefer, there is an array of options available to you.
For many consumers, the TV remains the major hub for entertainment devices. 60% of the content we watched in2015 was on TV, followed by PCs at 26% and mobile devices (smartphones and tablets) at 14%.
GfK ConsumerScope: Device Content watched on in Q4 2015

70%
60%
50%
40%
30%

60%

20%

27%

10%

14%

0%

14%

Which device a consumer uses depends a lot upon the type of content that is being consumed. Physical discs arewatched mainly on the TV, while the digital platforms are more varied and have a higher proportion of content watchedon a mobile device. For piracy, PCs are highly represented, reflecting the source of the content.
GfK ConsumerScope: Display used by Type (Q3 2015)
100%
90%

15%

15%

80%

8%

4%
11%

7%
6%
29%

70%
60%
50%
40%

83%

82%

76%

30%

10%
8%

6% 2%

28%

42%

TabletMobile phone

57%

53%

20%

49%

10%
0%

Other

PC/laptop screen
TV

Purchased
DVD/BD
n=268

RentedDVD/BD
n=484

VoD
n=498

SVOD
n=786

EST
n=251

Piracyn=440

AUSTRALIAN HOME ENTERTAINMENT DISTRIBUTORS ASSOCIATION Yearbook 201569

Devices and Emerging
Viewing Patterns
TVs – The entertainment hub
The TV market returned to growth in 2015, up 9% in value on 20141. This rise was helped by a move tobigger screens, smart TV and UHD/4K functionality.
TVs are getting bigger. In 2015, 39% of the TVs sold had a screen size of 50 inches or larger. This marks
the largest share this sector has enjoyed since launch.
GfK Retail Tracking: 50”+ Screen Size Unit Share of TV Market

45%
40%

39

36

35%
30%

29

25%
20%
15%

17

20

10%
5%
0%

2011

2012

2013

2014

2015

TVs are also getting smarter. 32% of households have a smart TV, while half of all the TVs sold in 2015 had smart
functionality2. There are many reasons to buy a smart TV, with consumers stating that smart functionality helps provide
easier access to services such as Catch-up TV and on-demand. 75% of smart TV buyers agree that their smart TV
enables them to easily watch digital content on the big screen3.
GfK ConsumerScope: Reasons for Buying a Smart TV (Sep-15) % Agree/Strongly Agree45%

Ability to access the Internet in general

42%

Smart TV just came as a standard feature38%

To easily access catch-up TV services/apps
To easily access SVOD services

31%

Greater access to more TV channels

30%
24%

To easily access VOD services
0%

5%

10%

15% 20% 25% 30%

35%

40% 45%50%

AUSTRALIAN HOME ENTERTAINMENT DISTRIBUTORS ASSOCIATION Yearbook 201570

Devices and Emerging
Viewing Patterns
The picture quality of TVs has also improved. UHD or 4K TVs accounted for 18% of all TVs sold in 2015, up from 4% in20144. Though sales have increased, there are still some barriers to overcome for UHD/4K TVs, including content andprice.
GfK ConsumerScope: Barriers to UHD/4K TV adopion (Sep-15)

70%
37%

Not worth paying
more for 4K/UHD TV

24%

Not enough 4K / UHD
content available

UHD/4K is a gimmick andprovides no real benefits

Mobile Devices
14% of home video entertainment content is watched on a mobile device, split evenly between tablets andsmartphones5. Penetration for these 2 devices is very strong, with smartphones at 82% and tablets at 46%6.
In 2015, the smartphone market increased by 19% in value , helped by a move to more premium models with larger
screens. Like TVs, large screen models are taking more share of the market than ever before.
GfK Retail Tracking: 5.5”+ Screen Size Unit Share of Smartphones Market

16%

15

14%
12%
10%
8%

7

6%
4

4%
2%
0%

0
2012

2013

2014

2015

AUSTRALIAN HOME ENTERTAINMENT DISTRIBUTORS ASSOCIATION Yearbook 201571

Devices and Emerging
Viewing Patterns
Consumers with large screen phones tend to use them more often than those with smaller screens. 40% ofconsumers with a large screen phone (5.5” and above) streamed video content on a daily basis, compared to just 30%of those with smaller screens8. It is not just video entertainment content either, consumers with larger screens tend to
take photos, play games and listen to music on their device more often than consumers with a smaller phone.
GfK ConsumerScope: Daily Phone Acivity (% of people) - H1 201532%

Take photos/video

51%

32%

Play games

41%

30%

Stream video content
Stream music

28%

Watch Catch-up TV

28%

0%

10%

20%

Small Screen (<5.5")

40%

Big Screen (5.5"+)

38%
38%

30%

40%

50%

60%

Mobile Viewing remains a challenge
Whilst mobile devices are being used to watch video entertainment content, that usage is primarily in the home. The
digital formats; EST, VOD and SVOD have the highest shares of viewing on a mobile device and even those formats
have a relatively low share of out-of-home viewing.
GfK ConsumerScope: Out of Home Viewing % by Type

10%
8%
6%

9

8
5

4%

8

5

6

5

4

6

2

2%
0%

8

8

Q4-13

Q1-14

Q2-14

2

Q3-14

Q4-14

4

6
6

EST
VOD
SVOD

4

Q1-15

Q3-15

Concerns over data usage and accessibility are some of the main barriers to viewing more content outside the home,though SVOD may help to develop that area in the future. Though it is currently a lower share, the proportion of SVOD
content being watched outside the home has been growing.

AUSTRALIAN HOME ENTERTAINMENT DISTRIBUTORS ASSOCIATION Yearbook 201572

Devices and Emerging
Viewing Patterns
Players – DVD, Blu-ray and Consoles
Nearly half of Australians watch physical discs at least once a month, so the need for DVD and Blu-ray players is still
very strong9. In 2015, there were 1 million players sold in the Australian market, with 48% of those being Blu-ray10.
Of course, standalone players are not the only devices capable of playing Blu-ray discs. Gaming consoles, such as
the PS4 and Xbox One, are both Blu-ray compatible and offer consumers another way of watching their Blu-ray discs.
Including the consoles, the penetration of Blu-ray devices in Australian homes is 45%. 3D Blu-ray players are a smaller
part of the Blu-ray hardware market, but are now present in 10% of homes.
GfK ConsumerScope: Household Penetraion Q4 2015

Standalone DVD Player

52%
45%

Total Blu-ray Players (incl. consoles)
23%

Standalone Blu-ray Player
PS4

11%

3D Blu-ray Player

10%Xbox One

7%
0%

10%

20%

30%

40%

50%

60%

Digital Media Players – Apple TV and Chromecast
Media players, such as Apple TV and Chromecast, provide a relatively easy way for consumers to access theirfavourite content on the TV. Sales for these devices grew sharply in 2015, especially since the launch of Netflix in April
2015.
Combined, these devices have sold over 1 million units since they launched and are now present in 17% ofhouseholds11. Apple TV has the highest penetration of any media player at 9%, though sales for Chromecast haveincreased steadily in 2015 and penetration now sits at 7% of households.
GfK ConsumerScope: Media Player Household Penetraion

17%
9%

Total Media Player

7%

Apple TV

Chromecast

4%
Other Media Player

AUSTRALIAN HOME ENTERTAINMENT DISTRIBUTORS ASSOCIATION Yearbook 201573

Devices and Emerging
Viewing Patterns
2015 and beyond
2015 was a big year for video entertainment hardware. There was strong value growth for all of the key devices, withthe exception of tablets. Overall, there is a trend towards bigger screens, both in TVs and smartphones, allowing
consumers to have a better experience when watching their content.
The availability of content is something which will continue to impact on hardware sales. A key example of therelationship between hardware and software is the increase in sales for media players following the launch of Netflix. It
is important to note that even when the content is available, it has to be suitable content, that is wanted by consumers,
at a price that is considered to be reasonable.
Looking forward to 2016, it is expected that the hardware market will continue to change. Digital viewing is forecast
to take a greater share in 2016, which may lead to a change in which devices people use to view their content. On
top of this, new devices like VR headsets are set to expand in early 2016 and provide an exciting opportunity to give
consumers a greater experience than ever before.

About GfK
GfK is the trusted source of relevant market and consumer information that enables its clients to make smarter
decisions. More than 13,000 market research experts combine their passion with GfK’s 80 years of data science
experience. This allows GfK to deliver vital global insights matched with local market intelligence from more than 100
countries. By using innovative technologies and data sciences, GfK turns big data into smart data, enabling its clientsto improve their competitive edge and enrich consumers’ experiences and choices.
To find out more, visit www.gfk.com or follow GfK on Twitter: https://twitter.com/GfK_en

1 GfK Retail Tracking. TV Value % change, 2014 vs. 2015 (excludes commercial, direct, grocery channels)
2 GfK Retail Tracking. 2015 Volume share of “Smart TV” feature (excludes commercial, direct, grocery channels)
3 Source: GfK TV ConsumerScope / Base: TV buyers in Apr-Sep 2015 (n=1,267)
4 GfK Retail Tracking. 2015 Volume share of “HD Type” feature (excludes commercial, direct, grocery channels)
5 Source: GfK ConsumerScope – Content device usage, Q4 2015
6 Source: GfK ConsumerScope - Which of the following devices do you own? Q4 2015.
7 GfK Retail Tracking. SMP Value % change, 2014 vs. 2015 (excludes commercial, direct, grocery channels)
8 Source: GfK SMP ConsumerScope - Daily phone activity by type, H1 2015.
9 Source: GfK ConsumerScope - Which of the following have you watched in the last month? Q4 2015
10 Source: GfK Retail Tracking. 2015 Video Player Vol % by Type (excludes commercial, direct, grocery channels)
11 GfK Retail Tracking. LTD volume for Media Players (excludes commercial, direct, grocery channels). Penetration – GfK
ConsumerScope, Q4 2015.

AUSTRALIAN HOME ENTERTAINMENT DISTRIBUTORS ASSOCIATION Yearbook 201574

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AUSTRALIAN HOME ENTERTAINMENT DISTRIBUTORS ASSOCIATION Yearbook 2015
75

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2

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Piracy has fallen in all age
groups except 35-49s and is
no longer the norm amongst
18-24s.

AUSTRALIAN HOME ENTERTAINMENT DISTRIBUTORS ASSOCIATION Yearbook 201576

2015 Piracy Research
IT’S COMPLEX: Dynamic changes in theAustralian copyright landscape
Lori Flekser, Executive Director, Creative Content Australia
2015 News Headlines:•

There’s hope to combat piracy (Forbes Magazine)i We’re an out and proud nation of illegal downloaders (Sydney 		Morning Herald)ii•

Downloading movies and TV is not a crime (Sydney Morning Herald)iii•

Creators should benefit when their copyright is stolen (Sydney Morning Herald)iv•

Blocking piracy websites is bad for Australia’s digital uture (The Conversation)v•

Is downloading really stealing? (The Conversation)vi

Headlines can be confusing – the reporting of copyright news is often rife with contradictions and inconsistencies.
If, as consumer groups such as Choice would have us believe, online copyright infringement is the result of lack ofaccess to legitimate content, shouldn’t piracy rates be diminishing rapidly? So how come Interstellar was reportedly
downloaded 46.7m times in 2015? Wolf of Wall Street – at 30m downloads, the most downloaded title of 2014 would not even have made the Top 10 in 2015.
If consumers are being driven out of cinemas by high ticket prices and “forced” into the murky high seas of piracy, how
is it that exhibition achieved the highest box office revenue ever in 2015?
It’s complex.
New research commissioned by the Creative Content Australia in July 2015vii shows a small reduction in piracy rates in incidence and frequency - in Australia since 2014. 25% of Australian adults (aged 18-64) pirate – a decrease from
29% in the previous year. Piracy has fallen in all age groups except 35-49s and is no longer the norm amongst 18-24s.
2015 Piracy Activity by Age

60%
50%
40%

54
46

48

2015

40

30%

2014
20
20

20%
10%
0%

13
6

18-21

25-34

35-49

50-64

AUSTRALIAN HOME ENTERTAINMENT DISTRIBUTORS ASSOCIATION Yearbook 2015
77

2015 Piracy Research
That’s good news, right?
In theory, yes. But - and there is always one of those – there is no room for complacency as 40% of persistent pirates(those who pirate once a week or more) say they are pirating more than they did 12 months ago.
2015 Piracy Activity
25
24

40

9
31

Persistant59

CasualAbout the same as 12 months ago

10

More often than 12 months ago
Less often than 12 months ago

79

LapsedThis is the Creative Content Australia’s seventh wave of research since 2008. This new quantitative research study,
by independent research company Sycamore in conjunction with Omnipoll was conducted online in August 2015,
surveying 1265 respondents aged 18-64, with national coverage and anonymous participation.  
The research uncovered a multifaceted range of measures, including new legislation, that may have contributed to thisresult.
•Those who have pirated were far more likely than those who have never pirated to be aware ofanti-piracy initiatives such as the Copyright Amendment Bill 2015 (43% vs 24%), Dallas Buyers Club litigation(51% vs 42%) and proposed notification scheme (48% vs 32%).

•

Streaming services show growth – from 26% in 2014 to 32% in 2015, with high levels of awareness of newservices. 33% of respondents accessing a subscription service were taking advantage of a free trial, with 66%
of those indicating their intention to take up a paid service in future.

•

Of those who claimed to be pirating less frequently, 33% identified legal alternatives as the main reason for
declining piracy rates, while 63% cited other reasons including moral considerations (21% - feeling bad about
pirating/acknowledging piracy is theft) or self-interest (16% - worrying about being caught or getting a virus) or
no longer having time (13%).

The combination of new legislation passed in June (Copyright Amendment Bill 2015), the high profile Dallas Buyers
Club legal case, the proposed notification scheme and the launch of new streaming services such as Netflix, Stan and
Presto, has contributed to the downward movement of piracy rates.

AUSTRALIAN HOME ENTERTAINMENT DISTRIBUTORS ASSOCIATION Yearbook 2015
78

2015 Piracy Research
Increased efforts of the distribution and exhibition sectors to lower prices and make content available have also had an
impact on the incidence and frequency of screen content piracy.
In new research, released by the Government in July 2015viii, consumers claimed that cost reduction and availability
are the factors that would most encourage them to stop piracy.  Robust research consistently confirms that Australianprices compare favourably to the rest of the world.
Research released in 2015 by Deakin Universityix confirms that Australian prices for screen content compare favourably
to the rest of the world. 2015 AHEDA research shows Australian new release SD VoD pricing average was $4.63, NZ$4.93, UK $4.78 and the US $4.41.
And yet we still have one of the highest rates of piracy.  The Government research verified the findings of six wavesof Creative Content Australia research, conducted since 2008, which consistently identified the principal reason for
downloading pirated content is because it is free. There is a world of difference between what pirates say they would
do and their actual behaviour.
Piracy has always needed a range of measures to tackle the problem as we all know there is no silver bullet. The
recent small decline in piracy is largely attributable to the combination of the government’s new legislation, plus
the ongoing efforts of the creative industries to continue delivering great content at accessible prices to Australianconsumers, as well as the work being done to educate consumers about the impact of copyright theft.
The Government showed leadership in passing critical legislation, and the public discourse from Ministers Turnbull and
Brandis, has shone a light on this issue and given the creative industry the opportunity to have its say amidst the very
vocal blogosphere and wide media coverage of a well-intentioned but not always well-informed consumer advocacy
campaign.
Strong copyright laws are needed to ensure the vibrancy and growth of the creative sector which in turn contributes tothe economy, provides jobs and stimulates local culture. Copyright facilitates innovation rather than hinders it.
However, fighting copyright theft is not a problem that is entirely up to governments and large corporations to solve. As
British filmmaker and educator David Puttnam pointed out, we as a society, should become more focused on the ideaof digital citizenship. He suggested that while there is wide discussion about the freedoms desired by those who use
the Internet, there is scant debate about what sort of responsibilities one should take when going online.
It is for this reason that Creative Content Australia continues to focus on the vital role of education in the fight against
copyright theft by creating consumer campaigns and free online resources to teach primary and secondary students

AUSTRALIAN HOME ENTERTAINMENT DISTRIBUTORS ASSOCIATION Yearbook 2015
79

2015 Piracy Research
about the value of content, the role of copyright and the impact of piracy. The Creative Content Australia education
resources stimulate students to look at their own actions and values and consider the consequences of their choices.
In what may prove a pivotal year for copyright legislation, it is equally vital for members of the creative industries to put
pressure on government and private corporations to act responsibly and fairly when it comes to addressing the piracy
problem.
The work of Creative Content Australia fulfils a valuable role in the Australian copyright sector, even though outcomesmay be difficult to measure against the numerous activities undertaken. Considered individually these programs may
appear insubstantial, but are cumulatively vital to:•

Demonstrate that the creative industry is not simply relying on legislative intervention by government but isplaying its part in reducing piracy through evolving distribution models and by providing substantial funds tocopyright research and education.

•

Provide a voice to the media to balance the plethora of pro-piracy arguments.

•

Stimulate further media attention with the release of Creative Content Australia research and resources.

•

Communicate the cultural and commercial value of copyright, particularly to young Australians via education
resources which are accessed in the thousands annually.

•

Provide valuable research data for government and media to support arguments for copyright protection.

Ruth Vitale, CEO of the US anti-piracy creative industry organisation Creative Future, says, “It’s not just the creative
community or the technology community or the advertising community that can or should solve the piracy issue– it’s all of us working together. That’s how we continue to progress – and that’s how we ensure a thriving digitalmarketplace for creative content”.
Creative Content Australia is a not-for-profit industry initiative committed to raising awareness about the value of screen
content and the impact of piracy through research, consumer campaigns and education – ipawareness.com.au

i www.forbes.com – Aug 5, 2015
ii www.smh.com.au – Nov 10, 2014
iii www.smh.com.au – Dec 10, 2014
iv www.smh.com.au – Nov 26, 2014v www.theconversation.com – Nov 24, 2014
vi www.theconversation.com – Apr 13, 2015
vii Research study commissioned by IP Awareness and conducted by independent research company Sycamore in conjunction with 			Omnipoll 2015 - http://www.ipawareness.com.au/research/2015
viii Research study into online copyright infringement commissioned by the Department of Communications, undertaken by Taylor Nelson Sofries(TNS) Australia and released in 2015
iv A research study by the School of Communication & Creative Arts 2015 by Bronwyn Coate, Research Fellow, and Deb Verhoeven, Chair &Professor of Media & Communication, Deakin University 2015

AUSTRALIAN HOME ENTERTAINMENT DISTRIBUTORS ASSOCIATION Yearbook 201580eDVD + Blu-ra
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AUSTRALIAN HOME ENTERTAINMENT DISTRIBUTORS ASSOCIATION Yearbook 201581

Australian films enjoyed theirbest-ever year at the box office,surpassing the previous all-timebox office record of $63.4m set
in 2001 with a remarkable $88
million in box office revenue.

AUSTRALIAN HOME ENTERTAINMENT DISTRIBUTORS ASSOCIATION Yearbook 2015
82

Theatrical Film Industry:
2015 Box Office
A snapshot of the theatricalfilm industry in 2015
2015 – a great year at the box office2015 lived up to its promise as the most successful year ever at the Australian cinema box office. Up 14% from 2014,
the 2015 box office cume of  $1,226,315,433 smashed the previous high of $1,128,498 (2010).
Audiences flocked to the cinema in record numbers to enjoy a range of Australian and international films that featured
quality storytelling and engaging, entertaining
TOP 10 FILMS OF 2015 (as at 31 December 2015)

RANK TITLE
DISTRIBUTOR
BOX OFFICE IN 2015__________________________________________________________________________________________________
1

Star Wars: The Force Awakens

Walt Disney

62,785,185

2

Jurassic World

Universal

52,938,244

3

Fast And Furious 7

Universal

43,337,100

4

The Avengers: Age Of Ultron

Walt Disney

40,113,085

5SpectreSony Pictures

34,578,531

6

Minions

Universal

32,905,862

7

Inside Out

Walt Disney

31,144,188

8

The Hunger Games: Mockingjay Part 2

Roadshow

29,002,702

9

Pitch Perfect 2

Universal

28,125,863

10
The MartianFox
27,427,945__________________________________________________________________________________________________
		
TOTAL$382,358,705__________________________________________________________________________________________________Star Wars The Force Awakens was indeed a force to be reckoned with, closing 2015 at $62.78m after only 2 weeks incinemas and breaking multiple box office records around the world.
Jurassic World ($52.94m) and Fast and Furious 7 ($43.34m) took #2 and #3 slots in the Top 10, followed by
Avengers: The Age of Ultron ($40.11m).
Spectre ($34.6m) demonstrated the enduring strength of the iconic Bond franchise while Minions ($32.9m) and Inside
Out ($31.1m) drew young and young-at-heart Australians into cinemas.  The other top performing films of the year
were the final instalment of the Hunger Games franchise Mockingjay Part 2 ($29m), Pitch Perfect 2($28.1m) and The
Martian ($27.4m).

AUSTRALIAN HOME ENTERTAINMENT DISTRIBUTORS ASSOCIATION Yearbook 2015
83

Theatrical Film Industry:
2015 Box Office
Australian films play their part
Australian films enjoyed their best-ever year at the box office ,surpassing  the previous all-time box office record of$63.4m set in 2001 with  a remarkable $88 million in box office revenue (7.18% share).
Contributing significantly to this achievement was Mad Max: Fury Road ($21.7m) and The Water Diviner ($10.18m in
2015/$15.8m CUME). The Dressmaker grossed $18.6m in 2015 and is still playing and in February 2016 passed the$20m mark, only the 11th Australian film to do so. That Sugar Film took over $1.7m to become the highest grossing
Australian documentary of all time (excluding IMAX films).
Graeme Mason, CEO of Screen Australia said: “It’s so wonderful to see Australian films connecting so strongly thisyear. The film industry is somewhat cyclical, so it is difficult to make claims based on one year’s results alone. However,
it is also important to celebrate success when it comes along, and given that the theatrical landscape is morechallenging than ever before, Australian films have well and truly over-performed.”
For Mason, this is a long game business. Helping bring films, TV shows and digital programs to fruition is often about
supporting artists all the way from conception to distribution, so they can realise their very personal, passionate
endeavours. Mason also notes that the most striking feature of the titles that have performed so well this year is thediversity of story types.

Strong promotion
In eight months of 2015, MPDAA companies spent over $120m in above the line marketing , bringing an incredibleline-up of stars to Australia including Amy Poehler and Pete Docter (Inside Out), Arnold Schwarzenegger (Terminator:
Genisys), Angelina Jolie (Unbroken), Ice Cube and O’Shea Jackson Jr (Straight Outta Compton),Channing Tatum(Magic Mike XXL), Amy Schumer and Bill Hader (Trainwreck) and Chris Rock (Top Five). Home-grown stars CateBlanchett, Joel
Edgerton, Russell
Crowe, HughJackman, Jai
Courtney andRebel Wilson
played their partin promoting theirfilms.

AUSTRALIAN HOME ENTERTAINMENT DISTRIBUTORS ASSOCIATION Yearbook 2015
84

Theatrical Film Industry:
2015 Box Office
Trends and stats
The total number of films released in Australia in 2015 increased from 505 in 2014 to 542.  Films came from 32
countries with Indian (90) and Chinese (29) films making up the highest number of foreign films released.
Reflecting the trend in previous years, M-rated films were the most common.
Classification
2015
2014
2013
______________________________________________
R
6
7
9
MA
116
104
104
M
229
220
187
PG
85
70
61
G
20
24
21
OTHER (EX.)
868039_______________________________________________TOTALS
542
505
421_______________________________________________
With an average ticket price of $13.60 – a slight decline from the 2014 price of $13.68 - a night at the movies
continues to be good value & a popular out-of-home social occasion.

Film piracy and copyright legislation
Film piracy remains a significant threat to the cinema business. Interstellar was reportedly downloaded  46.7m times in2015. The Wolf of Wall Street, the most downloaded film of 2014 at 30m downloads, would not have made the Top 10
in 2015 (Secret Service was at #10 in 2015 with 31m downloads) Creative Content Australia 2015 research showedthat even though piracy amongst adults decreased slightly (from 29% in 2014 to 26% in 2015), one in four Australians
aged 12 – 64 accesses infringing film and TV content from pirate websites.
2015 was a seminal year with the passing of the Copyright Amendment (Online Infringement) Bill 2015. The legislation
allows rights holders to go to a Federal Court judge to block online locations that have the “primary purpose” offacilitating copyright infringement. Australian internet providers will need to comply with a judge’s order by disabling
access to the infringing location.
Website blocking measures have proven effective overseas. In recent years, courts in 10 EU countries have ordered
ISPs to block users’ access to specific sites and seen a subsequent decline in BitTorrent traffic. In 2016 we will see thefirst website blocking cases brought before the Australian Courts.  
The fight against piracy is now more important than ever, and the distribution and exhibition communities continue tosupport efforts to protect creative intellectual property. The failure to enact strong copyright protections could ultimately
inhibit the future of filmed entertainment.

AUSTRALIAN HOME ENTERTAINMENT DISTRIBUTORS ASSOCIATION Yearbook 2015
85

Theatrical Film Industry:
2015 Box Office
Motivating Millennials
One of the key challenges faced by the industry is to reverse the declining cinema attendance of Millennials. If
attendance figures continue to reflect this emerging trend over the next couple of years, a valuable and substantial
section of the cinema market is in danger of slipping away.
There is a lot of information available about the general and current trends in the Millennials demographic, basedon their behaviour and attitudes to mainstream and social media, money and leisure activities.  Understanding what
motivates the Millennials’ choices of leisure activities is the key to creating relevant and targeted messages. We should
consider an industry initiative to ensure we continue to engage and resonate with this important audience.
It is clear that the Millennials present a challenge in terms of their levels of piracy activity and attitude to the value ofcontent but they are an important group and there will be a strong focus on drawing them back into cinemas in the
future.

Looking ahead
The 2015 box office result is testament to the diverse line-up of great films that drew audiences into cinemas andproved that the cinema-going experience is still one of the most popular forms of entertainment in Australia, even in theface of an ever-increasing choice of out-of-home leisure options and content viewing platforms.
As we look ahead, we are thrilled that exhibitors continue to enhance the cinema experience through luxury options
and state-of-the-art technology. With an incredible line-up of exciting films in 2016, we look forward to another great
year at the movies.

Jo Bladen
Chair, MPDAA
And
General Manager – Studios,
Australia & New Zealand,
The Walt Disney Company (Australia)

AUSTRALIAN HOME ENTERTAINMENT DISTRIBUTORS ASSOCIATION Yearbook 201586Market overview
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AHEDA members directory
AHEDA

MADMAN ENTERTAINMENT PTY LTD

Level 33, Australia Square,

Building 1, Level 1,

264 George Street,

21-31 Goodwood Street

Sydney NSW 2000

Richmond VIC 3121

Tel:

Tel:

(02) 9258 1971(03) 9261 9200

Fax: (02) 9258 1111

Fax: (03) 9261 9211

Chief Executive:  .  .  .  .  .  .  .  .  .  .  .  . Simon Bushwww.madman.com.au
Joint Managing Director Australia

DEFIANT SCREEN ENTERTAINMENTNew Zealand:  .  .  .  .  .  .  .  .  .  .  .  .  .  Paul Wiegard

Suite 1001,

Director of Sales:  .  .  .  .  .  .  .  .  .  .  Elizabeth Allen

4 Daydream Street

Director of PR & Marketing:  .  .  .  .  Lee-Ann Woon

Warriewood NSW 2102

Director of Operations:  .  .  .  .  .  .  .  Andrew Spittle

Tel:(02) 9997 3936

PARAMOUNT HOME MEDIA
INTERNATIONAL; APAC

Fax: (02) 9997 3938
http://www.defiant-ent.com/
Managing Director:  .  .  .  .  .  .  .  .  .  .  Marilyn Greig

Level 1, 65 Pirrama Road

Marketing Director:  .  .  .  .  .  .  .  .  .  . Justine Butler

PYRMONT NSW 2009

Sales Director:  .  .  .  .  .  .  .  .  .  Michelle GodmaireTel:(02) 9265 0200

Executive Director Digital, Marketing,Operations Director:  .  .  .  .  .  .  .  .  .  . Geoff Doyle
Finance Director:  .  .  .  .  .  .  .  .  .  .  .  Glenn Casey

APAC  .  .  .  .  .  .  .  .  .  .  .  .  .  .  . Richard Clarkson

ENTERTAINMENT ONE FILMS
AUSTRALIA PTY LTD

Australia & New Zealand .  .  .  .  .Carolyn Johnston

Director, Regional Television Sales,
Manager Digital, Marketing, APAC .  .  .  .  Sue Kang

28-30 Queen Street,
Chippendale NSW 2008

ROADSHOW ENTERTAINMENT

Tel:

Level 4 235 Pyrmont Street,(02) 8303 3800

Fax: (02) 9690 1433

Pyrmont NSW 2009http://au.eonefilms.com/home

Tel:Managing Director:  .  .  .  .  .  .  .  .  .  .  .  .  Troy Lum

Fax: (02) 9552 2510

SVP Home Entertainment:  .  .  .  .  .  .  .Jo Mandatis

www.roadshow.com.au

SVP Digital:  .  .  .  .  .  .  .  .  .  .  .  .  .  .Louise Balletti

CEO:  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  . Chris Chard

Head of Marketing –Group Sales Director:  .  .  .  .  .  .  .  .  . Brandon Hill

Home Entertainment:  .  .  .  .  .  .  .  .  .  .  .  . Liz HallGroup Marketing Director:  .  .  .  .  Nicola Craddock(02) 95528600

General Manager Reel Dist:  .  .  .  .  .  . Karl Wissler

AUSTRALIAN HOME ENTERTAINMENT DISTRIBUTORS ASSOCIATION Yearbook 2015
88

AHEDA members directory
STUDIOCANAL AUSTRALIA
Level 50, 680 George St

WALT DISNEY COMPANY(AUSTRALIA) PTY LTDSYDNEY NSW 2000

Melbourne Office:Tel: (02) 8353 2100

Level 5, The Como Centre,

studiocanal.com.au/

650 Chapel Street

CEO Australia & New Zealand:  . Elizabeth Trotman

South Yarra VIC 3141

Head of Home Entertainment ANZ .  Graeme Rogan

Tel:

Fax: (03) 9826 0824

TWENTIETH CENTURY FOX
HOME ENTERTAINMENT

Sydney Office:Level 3, Frank Hurley Grandstand,

Level 3, 68 York Street

Fox Studios Australia,

SYDNEY NSW 2000

38 Driver Ave,

Tel:

Moore Park NSW 2021

(02) 8622 8444

www.disney.com.au

Tel: (02) 8353 2100

Senior Vice President andwww.foxmovies.com.au

Managing Director

Senior Vice President,

Australia & New Zealand:  .  .  .  . Catherine Powell

Australia & Japan:  .  .  .  .  .  .  .  .  .  .  . Flavio Paoli

GM of Consumer Sales

Director of Operationsand Licensing:  .  .  .  .  .  .  .  Kylie Watson-Wheeler

Australia:  .  .  .  .  .  .  .  .  .  .  .  .  .  .  Peter McKeon

GM of Studios:  .  .  .  .  .  .  .  .  .  .  .  .  .  . Jo Bladen

Director of Sales Australia: .  .  .  .  .  .  Kerry Morelli
Director of Marketing
Australia:  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .

(03) 9832 6000

Associate members
FOXTEL

Claire Bryant

Vice President, Finance,

Angus Pitt

Asia Pacific: .  .  .  .  .  .  .  .  .  .  .  .  .  .  . Mats Weisswww.foxtel.com.au

SONY DADCUNIVERSAL SONY PICTURES HOME
ENTERTAINMENT (AUSTRALIA) PTY LTD

Peter Colby

Level 30, 1 Market Street,

TECHNICOLOR

www.sonydadc.com

Sydney NSW 2000
Tel:

Iain Fynes-Clinton(02) 9266 2800

www.technicolor.com.au

www.facebook.com/TheViewingLounge

TELSTRAManaging Director:  .  .  .  .  .  .  .  .  .  .Jim Batchelor

Moira Hogan

Operations Director:  .  .  .  .  .  .  .  .  Kate Bradbury

www.telstra.com.au

Sales Director:  .  .  .  .  .  .  .  .  .  .  .  Paul Courtney
Marketing Director:  .  .  .  .  .  .  .  . Cindy McCulloch

AUSTRALIAN HOME ENTERTAINMENT DISTRIBUTORS ASSOCIATION Yearbook 2015
89

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AUSTRALIAN HOME ENTERTAINMENT DISTRIBUTORS ASSOCIATION Yearbook 201590

Appendix
Categories
Looking at the physical retail channel as a whole (DVD and Blu-ray combined), TV Series has been increasing in share,
but stabilised in 2015. The film category grew slightly in share, up to 53% in value in 2015 and accounting for two
thirds of the market volume. There has been a slight drop in share for the “Others” categories, which comprises areas
such as anime, music and documentaries.
GfK Retail Tracking: Category Value % by Year
10%
5%

9%
5%

9%
5%

6%
5%

7%
5%

6%
5%

32%

30%

32%

33%

35%

36%

OTHER
CHILDRENSTV SERIES

54%

56%

54%

53%

52%

53%

2010

2011

2012

2013

2014

2015

FILM (inc. Animated)

GfK Retail Tracking: Category Volume % by Year
9%
6%
19%

9%
7%
19%

8%
7%

7%
8%

5%
7%

4%
7%

21%

22%

24%

24%

OTHER
CHILDRENS

66%

65%

65%

64%

65%

66%

TV SERIESFILM (inc. Animated)

2010

2011

2012

2013

2014

2015

AUSTRALIAN HOME ENTERTAINMENT DISTRIBUTORS ASSOCIATION Yearbook 201591

Appendix
Categories: Film
GfK Retail Tracking: Film - Animated vs. Live Acion Value %
100%
80%

87

84

84

80

77

81

60%

Live Action

40%

Animated

20%
0%

13

16

16

20

23

19

2010

2011

2012

2013

2014

2015

The film category includes both animated and live action titles. Live action includes genres such as action, sci-fi,
comedy and drama. After a bumper year in 2014 for the animated genre, following the release of Disney’s Frozen, theshare of animated dipped in 2015, finishing closer to the shares in prior years. The live-action segment still accounts
for the majority of the value in the film category, generating over 80% of the value.
Sales of film titles can be further analysed by the length of time the title has been available for purchase. New release
titles are those that have been available for thirteen weeks or less. Titles older than thirteen weeks are categorised as
catalogue.
Within the new release film period, the market declined by just 2% in volume and actually would have shown volume
growth if not for the release of Frozen in 2014. The value was down further, at -6%, mainly due to the drop in share of
the higher priced Blu-ray format. Looking forward, new release film is set for a big 2016 and will include the release ofbox office smash, Star Wars: The Force Awakens.
Millions

GfK Retail Tracking: Release Type Value by Year
$500
$450

-6%

-5%

$400

$353

$350
$300
$250
$200

-8%

$270
$183

-13%

$326

2014

$257

2015

$172

$172

$150

$149

$100
$50
$0

New Release
MoviesCatalogue
Movies

TV Series

Other DTV

AUSTRALIAN HOME ENTERTAINMENT DISTRIBUTORS ASSOCIATION Yearbook 201592

Appendix
The catalogue film segment showed the least decline in 2015, dropping by just 5% compared to 2014. This was quite
a reversal on 2014, where this area showed the largest decline of any release type. To further analyse the catalogue
film market, we can be split the sales into titles that were released within a year of their theatrical release (newtheatrical)
and titles that were released after that one-year window (cinema release). Cinema release titles are often re-releases,or titles with new packaging. In 2014, that cinema release area declined by -24%, but in 2015 it stabilised and actually
out-performed the new theatrical area.

Millions

GfK Retail Tracking: Theatrical Catalogue Value by Type
$300
$250
$200

CINEMA RELEASE (-4%)$150

NEW THEATRICAL (-6%)

$100
$50
$0
2010

2011

2012

2013

2014

2015

A key reason for the better performance of the cinema release segment in 2015 was the drafting of big theatricalfranchises such as Star Wars and Jurassic Park.
GfK Retail Tracking: Top 5 selling Cinema Release titles, 2015, ranked by volume
RANK TITLE
DISTRIBUTOR____________________________________________________________________________________
1

Star Wars Episodes IV/ V/ VI

20Th Century Fox

2

Star Wars Prequel Episodes I/II/III

20Th Century Fox

3

Snow White and the Seven Dwarfs

Walt Disney Studios

4

Little Mermaid (1989)

Walt Disney Studios

5Jurassic Park Trilogy
Universal____________________________________________________________________________________

AUSTRALIAN HOME ENTERTAINMENT DISTRIBUTORS ASSOCIATION Yearbook 201593

Appendix
Categories: TV Series
The TV Series category was the largest individual category in 2015, accounting for 36% of the total market value forthe year. After expanding in share in recent years, the share levelled in 2015.

20%

20%

20%

19%

19%

20%

19%

17%

16%

Other DTV

27%

29%

30%

31%

30%

32%

33%

36%

36%

TV Series

43%

40%

38%

34%

33%

32%

31%

30%

30%

10%

11%

13%

16%

17%

17%

16%

17%

17%

2007

2008

2009

2010

2011

2012

2013

2014

2015

Catalogue Movies
New Release Movies

Within TV series, there are key licenses that generate a significant proportion of the value. The popularity ofRoadshow’s HBO Game of Thrones franchise showed no signs of abating and was the top selling license for the year,
generating nearly three times the next biggest license, Fox‘s ‘Vikings’.
GfK Retail Tracking: Top 10 selling titles, TV Series, Full Year 2015, ranked by volume
RANK TITLE
DISTRIBUTOR
GENRE____________________________________________________________________________________
1

Game of Thrones Season 4

RoadshowDrama

2

Game of Thrones Season 3

RoadshowDrama

3

Outlander Season 1 Part 1

Sony Pictures

rama

4

Downton Abbey Season 5

Universal

Drama

5

Big Bang Theory Season 8

RoadshowComedy6Game of Thrones Season 1

RoadshowDrama

7

Vikings Season 1

20Th Century Fox

Drama

8

Vikings Season 2

20Th Century Fox

Drama

9

Orange is the New Black Season 1

RoadshowComedy10Game of Thrones Season 2
RoadshowDrama____________________________________________________________________________________

AUSTRALIAN HOME ENTERTAINMENT DISTRIBUTORS ASSOCIATION Yearbook 201594

Appendix
GfK Retail Tracking: Top 10 selling licenses, TV Series, 2015, ranked by volume
RANK LICENSE
DISTRIBUTOR____________________________________________________________________________________
1

Game of Thrones

Roadshow2

Vikings Tv Series

20Th Century Fox

3

Sons of Anarchy

20Th Century Fox

4

Breaking Bad

Sony Pictures

5

Big Bang Theory

Roadshow6

Downton Abbey

Universal

7

Dr WhoRoadshow

8

Supernatural

Roadshow9

Walking Dead

20Th Century Fox

10House of Cards
Sony Pictures____________________________________________________________________________________

Categories: Children’s
Sales for children’s titles (titles aimed at children, with a running time under 60 minutes) experienced a year-on-year
decline of 15% in 2015, the second straight year of double digit decline.
Roadshow’s ‘Wiggles’ license was the top selling title of the year, closely followed by Universal’s ‘Lego’ license. The big
mover was Paramount’s ‘Paw Patrol’, which climbed up to be the third top selling license for the year.
One thing that may have an impact on the Children’s category is the rising availability of this content in the digital arena.
New streaming services have children’s content included in their libraries, as does the popular video sharing service,
YouTube.
GfK Retail Tracking: Top 10 selling licenses, Children’s, 2015, ranked by volume
RANK LICENSE
DISTRIBUTOR____________________________________________________________________________________
1

Wiggles

Roadshow2

Lego

Universal

3

Paw Patrol

Paramount

4

Teenage Mutant Ninja Turtles

Paramount

5

Disney Mickey Mouse

Walt Disney Studios

6

Scooby Doo

Roadshow

7

Dora The Explorer

Paramount8

Peppa Pig

20Th Century Fox

9Sponegbob Squarepants

Paramount10
Thomas & Friends
Roadshow____________________________________________________________________________________		

AUSTRALIAN HOME ENTERTAINMENT DISTRIBUTORS ASSOCIATION Yearbook 201595

Appendix
Categories: Others‘Other’ titles in the disc market include genres such as documentaries, music, anime and sport titles.
Combined, these genres declined by 13% in value in 2015. The main genre to decline was the music genre, which
halved in value. There were some areas that did increase though, including documentaries, which jumped by 7% involume and 4% in value. Madman’s ‘That Sugar Film’ was a top seller for documentaries.
GfK Retail Tracking: Top selling Documentaries, Full Year 2015, ranked by volume
RANK TITLE
DISTRIBUTOR____________________________________________________________________________________
1

That Sugar Film Madman

Entertainment

2

Kurt Cobain Montage of Heck

Universal

3

Australia The Story of Us

Beyond4

Snipers

Beyond5

Ronaldo (2015)

Universal

6

Cosmos A Spacetime Odyssey Season 1

20Th Century Fox

7

Amy (2015)

20Th Century Fox

8Life Story

Roadshow9

Katy Perry Part of Me

Paramount10
Pacific
Roadshow____________________________________________________________________________________		
Within music titles, which consist of actual music performances, rather than music documentaries, Katy Perry’s
Prismatic world tour was the top seller:
GfK Retail Tracking: Top selling Music titles, Full Year 2015, ranked by volume
RANK TITLE
DISTRIBUTOR GENRE___________________________________________________________________________________________________
1

Katy Perry The Prismatic World Tour Live

Universal Music

Dance

2

John Farnham and Olivia Newton John Two Strong Hearts Live in Concert SBMERock & Metal

3

One Direction Where we are - Live from San Siro Stadium

SBME

Rock & Metal

4

Roger Waters The Wall

Universal

Rock & Metal

5

Pink Truth about Love Tour Live from Melbourne

SBME

Rock & Metal

6

Les Miserables Musical Event of a Lifetime in Concert
25Th Anniversary the O2

Universal

Classical

7

Andre Rieu And His Johann Strauss Orchestra Magic of the Movies

Universal MusicClassical

8

Miley Cyrus Bangerz Tour

SBME

Dance

9

Guy Sebastian Armageddon

SBME

Rock & Metal

10
Inxs Live Baby Live
Universal Music Rock & Metal___________________________________________________________________________________________________

AUSTRALIAN HOME ENTERTAINMENT DISTRIBUTORS ASSOCIATION Yearbook 201596

Appendix
For Anime, Madman Entertainment titles dominate and account for all of the top 10 sellers.
GfK Retail Tracking: Top selling Anime titles, Full Year 2015, ranked by volume
RANK TITLE
DISTRIBUTOR____________________________________________________________________________________
1

The Wind Rises

Madman Entertainment

2

The Tale of The Princess Kaguya

Madman Entertainment

3

Howls Moving Castle

Madman Entertainment

4

My Neighbor Totoro

Madman Entertainment

5

Naruto the Movie Road to Ninja

Madman Entertainment

6

Attack on Titan Collection 1

Madman Entertainment

7

When Marnie was There

Madman Entertainment

8

Attack On Titan Collection 2

Madman Entertainment

9

The Last - Naruto the Move

Madman Entertainment

10
Sword Art Online 2 Part 1
Madman Entertainment____________________________________________________________________________________		
And finally, within the sport and health and fitness genres, Shock’s WWE hit ‘Wrestlemania 31’ took top spot.
GfK Retail Tracking: Top selling Sport and Health and Fitness titles, Full Year 2015, ranked by volume
GfK Retail Tracking: Top selling Sport and Health and Fitness titles, Full Year 2015, ranked by volume
RANK TITLE
DISTRIBUTOR GENRE__________________________________________________________________________________________________
1

WWE Wrestlemania 31 XXXI

Shock Records

Sport

2

AFL Premiers 2015 Hawthorn

BeyondSport

3

Ford in Racing Glory Years

BeyondSport

4

The Holden Films

BeyondSport

5

Legends of Bathurst

BeyondSport

6

WWE Royal Rumble 2015

Shock Records

Sport

7

NBA Ultimate Jordan

BeyondSport

8Charlotte Crosbys 3 Minute Belly Blitz

Universal

Health & Fitness

9

Espn Legends of Cricket Set

BeyondSport

10
Nrl Premiers 2015 North Queensland Cowboys Season Review
BeyondSport__________________________________________________________________________________________________

AUSTRALIAN HOME ENTERTAINMENT DISTRIBUTORS ASSOCIATION Yearbook 201597

Appendix
Top Seller Charts by Film GenreGfK Retail Tracking: Top selling Action titles, Full Year 2015, ranked by volume
RANK TITLE
DISTRIBUTOR
GENRE____________________________________________________________________________________
1

Fast & Furious 7

Universal

Action2

Hunger Games Mockingjay Part 1

Roadshow

Action3

Mad Max Fury Road

Roadshow

Action4

American Sniper

Roadshow

Action5

Terminator Genisys

Paramount

Action6

Kingsman the Secret Service

20Th Century Fox

Action7

Insurgent

20Th Century Fox

Action8

San Andreas

Roadshow

Action

9

John Wick

Roadshow

Action10
The Equalizer
Roadshow
Action____________________________________________________________________________________
GfK Retail Tracking: Top selling Adventure titles, Full Year 2015, ranked by volume
RANK TITLE
DISTRIBUTOR
GENRE____________________________________________________________________________________
1

Jurassic World

Universal

Adventure2

Marvel The Avengers Age of Ultron

Walt Disney Studios

Adventure3

Hobbit The Battle of the Five Armies

Roadshow

Adventure

4

Ant-ManWalt Disney Studios

Adventure

5

The Maze Runner

20Th Century Fox

Adventure

6

Dracula Untold

Universal

Adventure

7

Into The Woods

Walt Disney Studios

Adventure8

Hobbit The Desolation of Smaug

Roadshow

Adventure

9

Maze Runner the Scorch Trials

20Th Century Fox

Adventure

10
Guardians of the Galaxy
Walt Disney Studios
Adventure____________________________________________________________________________________

AUSTRALIAN HOME ENTERTAINMENT DISTRIBUTORS ASSOCIATION Yearbook 201598

Appendix
GfK Retail Tracking: Top Selling Animated titles, Full Year 2015, ranked by volume
RANK TITLE
DISTRIBUTOR
GENRE____________________________________________________________________________________
1

Minions

Universal

Animated

2

Inside Out (2015)

Walt Disney Studios

Animated3

Big Hero 6

Walt Disney Studios

Animated

4

Frozen (2013)

Walt Disney Studios

Animated5Home (2015)

20Th Century Fox

Animated

6

Despicable Me 2

Universal

Animated

7

The Boxtrolls

Universal

Animated

8

Penguins of Madagascar Movie

20Th Century Fox

Animated

9

Despicable Me

Universal

Animated

10
Snow White and the Seven Dwarfs
Walt Disney Studios
Animated____________________________________________________________________________________
GfK Retail Tracking: Top Selling Drama titles, Full Year 2015, ranked by volume
RANK TITLE
DISTRIBUTOR
GENRE____________________________________________________________________________________
1

Fifty Shades of Grey

Universal

Drama

2

The Water Diviner

Universal

Drama

3

The Second Best Exotic Marigold Hotel

20Th Century Fox

Drama

4

Unbroken

Universal

Drama

5

Magic Mike XXL

RoadshowDrama

6

The Imitation Game

Roadshow

Drama

7Best Exotic Marigold Hotel

20Th Century Fox

Drama

8

The Longest Ride

20Th Century Fox

Drama

9

Last Cab to Darwin

Icon Film Distribution

Drama

10
Focus (2015)
RoadshowDrama____________________________________________________________________________________

AUSTRALIAN HOME ENTERTAINMENT DISTRIBUTORS ASSOCIATION Yearbook 201599

Appendix
GfK Retail Tracking: Top Selling titles – All other genres combined, Full Year 2015, ranked by volume
RANK TITLE
DISTRIBUTOR
GENRE____________________________________________________________________________________
1Fury (2014)

Sony Pictures

War

2

Cinderella (2015)

Walt Disney Studios

Family3

Paddington Movie

Sony Pictures

Family4

Oddball (2015)

Roadshow

Family5Interstellar

Roadshow

Sci-Fi

6

Gone Girl

20Th Century Fox

Thriller

7

Star Wars Episodes IV/ V/ VI

20Th Century Fox

Sci-Fi8

Transformers Age of Extinction

Paramount

Sci-Fi9

Taken 3

20Th Century Fox

Thriller

10Paper Planes
Roadshow
Family____________________________________________________________________________________The best of all time: Life-to-Date Sales
Since the launch of GfK reporting in August 1997, Fox’s ‘Avatar’ continues to top the charts as the top selling physicaldisc of all time.
As these charts include the sales of a product throughout its lifetime, it is not surprising that most of the titles in the top
10 have been in the market for 10 years or more. Though not in the top 10, Disney’s ‘Frozen’ is the big mover and is
now ranked as the 20th top selling title of all time, despite being out for less than two years.
GfK Retail Tracking: Top selling titles, Life to Date, ranked by volume
RANK MODEL
DISTRIBUTORRELEASE DATE____________________________________________________________________________________
1
Avatar (2009)
20Th Century Fox
29/04/2010
2
Finding Nemo
Walt Disney Studios
13/01/2004
3
Harry Potter Philosophers Stone
Warner Bros
28/05/2002
4
Shrek
Universal
7/11/2001
5
LOTR: Fellowship of the Ring
Roadshow
6/08/2002
6
Monsters Inc
Walt Disney Studios
30/09/2002
7
Harry Potter Chamber of Secrets
Warner Bros
11/04/2003
8
Titanic
20Th Century Fox
14/01/1998
9
LOTR: Two Towers
Roadshow
23/08/2003
10
Ice Age
20Th Century Fox
16/10/2002____________________________________________________________________________________			

AUSTRALIAN HOME ENTERTAINMENT DISTRIBUTORS ASSOCIATION Yearbook 2015100

Appendix
GfK Retail Tracking: Top selling DVD titles, Life to Date, ranked by volume
RANK MODEL
DISTRIBUTORRELEASE DATE____________________________________________________________________________________

1
Finding Nemo
Walt Disney Studios
13/01/2004
2
Avatar (2009)
20Th Century Fox
29/04/2010
3
LOTR: Two Towers
Roadshow
23/08/2003
4
LOTR: Return of The King
Roadshow
25/05/2004
5
LOTR: Fellowship of The Ring
Roadshow
6/08/2002
6
Twilight (2008)
Sony Pictures
22/04/2009
7
Pirates Of The Caribbean
Walt Disney Studios
17/03/2004
8
Monsters Inc
Walt Disney Studios
30/09/2002
9
Harry Potter Prisoner of Azkaban
Warner Bros
1/12/2004
10
Harry Potter Chamber of Secrets
Warner Bros
11/04/2003____________________________________________________________________________________			
GfK Retail Tracking: Top selling Blu-ray titles, Life to Date, ranked by volume
RANK MODEL
DISTRIBUTORRELEASE DATE____________________________________________________________________________________
1

Avatar (2009)

20Th Century Fox

29/04/2010

2

Hobbit an Unexpected Journey

Warner Bros

1/05/2013

3

Marvel The Avengers

Walt Disney Studios

29/08/2012

4

Inception

Warner Bros

8/12/2010

5

Batman The Dark Knight Rises

Warner Bros

28/11/2012

6

Transformers Dark of The Moon

Paramount

10/11/2011

7

Batman The Dark Knight

Warner Bros

10/12/2008

8

Star Wars Saga Episodes I-VI

20Th Century Fox

14/09/2011

9

Harry Potter Deathly Hallows Part 2

Warner Bros

16/11/2011

10
Hunger Games
Roadshow
17/08/2012____________________________________________________________________________________			

About GfK
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To find out more, visit www.gfk.com or follow GfK on Twitter: https://twitter.com/GfK_en

AUSTRALIAN HOME ENTERTAINMENT DISTRIBUTORS ASSOCIATION Yearbook 2015101

Customers sign up to
Netflix for a numberof reasons including
affordability, the freetrial, ability to watch
when you want, binging
of episodes and accessto a catalogue of TV
shows and movies.

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