DVD a hit at home-theater box office

Home-theater systems are selling faster than tickets to a summertime Schwarzenegger flick, and the box office appeal is coming from the unprecedented popularity of DVD players.

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Sales figures released Monday by retail market research firm NPDTechworld show that DVD players have become the fastest-selling product in the history of the consumer-electronics market. And consumer-electronics makers have taken notice, adding DVD player capabilities to other types of products in the hope of cashing in--a strategy that's proved very successful.

"Manufacturers are looking to add value to products and show there is a benefit to consumers so they can eke out a profit on a product and differentiate it," said Tom Edwards, an analyst with NPDTechworld.

The latest gadgets to incorporate DVD players are home theaters. Sales of the systems, which combine a stereo receiver with a DVD player and speakers, increased 230 percent in 2001 over 2000 and more than 987 percent in the first five months of 2002 compared with 2001.

Sales of DVD players also continued to increase significantly. In 2001, sales increased 68.8 percent over 2000. Their popularity has caused them to quickly become a commodity product, with prices dropping to less than $100.

As sales of the players have risen, sales of VCRs have fallen. They decreased 40.5 percent over the first five months of 2002 compared with 2001. The decline in VCR sales has prompted retail chain Circuit City to stop selling movies on VCR tape and concentrate strictly on DVD movies.

Still, the demise of VCRs will likely take longer than many expect. VCRs are in 90 percent of U.S. homes, and DVD players are in only 30 percent, according to NPDTechworld.

Edwards said that it will take about 10 years for DVD players to be in 90 percent of U.S. homes. Annual unit sales of DVD players have been around 17.2 million, but this year they should be more than 20 million, according to Edwards.