New York – September 2001 – There are currently 2.43 million Canadian households in possession of a device capable of playing DVDs. Of that 2.43 million, an average roughly 54% actively rent a DVD in a given month. However, DVD is not the only format the majority of DVD households rent.

What we have uncovered is that close to 80% of households that rent DVD also rent VHS. This works out to approximately 1.03 million Canadian households – or 10.3% – that rent both VHS and DVD. The fact that close to 80% of DVD renters also rent VHS may reveal that, although DVD households continue to grow in Canada, DVD inventory in Canadian rental stores may not be keeping up the pace. The number one reason why a DVD household rented a VHS tape is because the title they wanted was not available on DVD. With much higher profit margins on a DVD rental than a VHS rental, it may be in some store’s best interest to increase their DVD inventory.

Of all Canadian households that rent both VHS and DVD, Blockbuster controlled the greatest share of their total rental volume – 31.7% or 14.2 million rentals – for the three month period of June, July and August. RogersVideo is the second most frequented rental destination for households that rent both formats, accounting for 13.1% of their rentals, or 5.9 million turns. The more popular choice at both outlets is VHS, where the format accounts for approximately 55% of total rentals from this group at Blockbuster, and over 60% at Rogers Video.

In total, households that rent both DVD and VHS, while only making up 10% of all Canadian households, accounted for a remarkable 19.8% of all VHS rentals over the three month period. This works out to over 20 million VHS rentals over the three-month period for the roughly 1.043 million households that rent both formats.  In other words, in addition to their already high monthly DVD volume, these households rent on average an additional 6.6 VHS tapes per month!

However, it doesn’t stop there. These households also accounted for a disproportionate number of pay-per-view buys. Again, although only accounting for 10% of Canadian households, households who rent both VHS and DVD account for 17% of all pay-per-view buys. So in total, this group on average rents 6.6 VHS tapes and 4.8 DVDs, and buys 0.32 PPV movies in a given month. This is a very active group, to say the least.

About Alexander & Associates
Alexander & Associates, Inc. is a consulting and market analysis firm based in New York City. The company’s core work is in the home entertainment market, focusing on consumer electronic entertainment vehicles. The company has provided a home video tracking service since March of 1987 based on weekly surveys of national consumer market behavior. The company is also actively studying satellite, digital cable, personal computer and Internet activity and how consumers are integrating these range of choices into their entertainment time and money budgets.

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