iTunes retains lead in U.S. online video market

According to new data from IHS Screen Digest, Apple remained in the top spot in the U.S. market for movie electronic sell through (EST) and Internet video on demand (iVOD) in 2010, despite rising market share for competitors. iSuppli reports that the iTunes Store accounted for nearly two-thirds—64.5 percent—of the EST/iVOD market in 2010, down from 74.4 percent in 2009; in the EST market alone, Apple accounted for three quarters of U.S. business. Apple was followed in the EST/iVOD rankings by Microsoft, which saw its market share jump from 11.6 percent in 2009 to 17.9 percent in 2010, and Sony, which went from 5.7 percent share in 2009 to 7.2 percent share in 2010. Overall, the EST/iVOD market underwent significant expansion in 2010, with revenue rising by more than 60 percent.

“The iTunes online store showed remarkable competitive resilience last year in the U.S. EST/iVOD movie business, staving off a growing field of tough challengers while keeping pace with an dramatic expansion for the overall market,” said Arash Amel, research director, digital media, for IHS. “Apple faced serious competition from Microsoft’s Zune Video and Sony Corp.‘s PlayStation Store, as well as from Amazon and—most significantly—Wal-Mart. However, iTunes managed to grow because of the introductions of the iPad and the second-generation Apple TV, which have spurred the company’s movie rental offerings and have invigorated the iTunes multi-screen ecosystem. We expect that in the United States, Apple’s strong performance in iVOD will allow it to continue to bypass the video on demand services offered by many major cable operators.”

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