The report combines the expertise of Screen Digest and Adams Media Research to provide historic and forecast data at the consumer level for the established online businesses in the US and the UK. It gives the first detailed analysis of the rapidly growing online rental markets in key western European territories, including France, Germany, Spain, Italy, Benelux and Scandinavia. The report also includes profiles of the key players in each territory, and examines the innovative business models that underpin the new sector.

The online rental business in the US and Europe will generate more than $1bn in consumer spending for the first time in 2005. This new phenomenon in the video industry has grown from its inception in the US in 1999 by combining new technology, in the form of DVD, with a much older delivery system: the post.

In the US, the world's largest video rental market, the US, online rental has already had a profound impact on the rental business. The model's pioneer, San Francisco-based Netflix, already claimed more than three and a half million subscribers in 2005, and in response, the established giant of high street rental, Blockbuster, has entered the fray, whilst simultaneous abolishing late fees for its US customers. In Europe too, home-grown internet upstarts lead the field.

Key findings:

• By the end of 2005 there will be more than 6.3 million online DVD rental subscribers in the US and Europe, generating more than $1b of consumer spending.
• The UK dominates the European market, followed by Germany and thriving markets have been established in France and Scandinavia.
• The online sector already accounts for more than one in ten video rentals in the UK. By 2009, more than half the UK's rental transactions, and rental spending, will be online.
• Almost 45m DVDs will be posted to online subscribers in Europe in 2005, while more that 381m will be delivered to mail boxes in the US.
• Across the key European markets, online rental made only a little more than one fiftieth of total consumer spending in 2004. The dramatic flourishing of the market will bring that proportion to over one third of the total by the end of our forecast period in 2009.

In the report:

• Coverage of 7 European markets and the US: UK, France, Germany, Spain, Italy, Scandinavia and the Benelux countries.
• Competitive landscape and detailed profiles of the key players in each market.
• Analysis of business models and metrics - including sources of business, fulfilment mechanics, common marketing strategies, economics of online rental
• Assessment of market size and growth potential

Table of Contents

List of tables and charts

Executive summary

Evolution of video rental
In the beginning…
The impact of retail
The move to disc
Netflix and the birth of online rental
Offline subscription
Development of online rental in UK and Europe

Evolution of video rental (tables & charts)
US: Consumer spending on video software by sector 1984-2004
Europe: Consumer spending on video software by sector 1984-2004
US: Consumer spending on video software by sector 1984-2004
Europe: Consumer spending on video software by sector 1984-2004
US: Consumer spending on video rental 2002-2009
Europe: Consumer spending on video rental 2002-2009
Key European players: Launch of online subscription services

Current competitive landscape
US
Netflix
Blockbuster

UK
Video Island
LoveFilm
Blockbuster
Amazon

France
Glowria
DVDFly
CineSnap

Germany
Amango
Amazon

Spain
MediaXPress Cine
Digitae

Italy
FilmACasa
Rentflix
DVDNetRent

Scandinavia
Brafilm
Boxman
CDon
Digitarian

Benelux
DVDPost
Palago

Current competitive landscape (tables & charts)
US: Market shares 2005
Netflix
Blockbuster online

UK: Market shares 2005
Video Island
LoveFilm
Blockbuster online
Amazon.co.uk

France: Market shares 2005
Glowria
DVDFly
CineSnap

Germany: Market shares 2005
Amango
Amazon
Germany: Price comparison

Spain: Market shares 2005
MediaXpress Cine
Digitae

Italy: Market shares 2005
FilmACasa
DVDNetRent
Rentflix
Brafilm
CDon
Boxman
Digitarian
DVDpost
Palago

Business models and metrics
Sources of business
Offline video renters
Cinema-goers
Retail DVD buyers
Pay TV subscribers

Fulfilment mechanics
Warehousing
Postage
Pricing structures

Common marketing strategies
Sponsored links and conventional advertising
Co-branding
White label services
Brand recognition and market consolidation

The economics of online rental
Case study: UK
Other key metrics
Seasonality

Business models and metrics (tables & charts)
UK: Video renters 2004, split by age
UK: Video renters 2004, split by income category
UK: Video renters 2004, split by gender
Comparison of postal rates in US$ 2005
Video Island key brands
LoveFilm key brands
UK: Brand recognition of online
DVD rentailers
UK: Online rentals by genre 2005
Netflix subscriber acquisition costs, 2002-2004
Market size and growth potential

Market size and growth potential: US and European markets compared
US
UK
France
Germany
Spain
Italy
Scandinavia
Benelux

Market size and growth potential: US and European markets compared (tables & charts)
Consumer spending on online rental 2005
Consumer spending on online rental 2009
Online rental subscribers 2002-2009
Online subscribers as % DVD households
Average monthly subscription fees 2002-2009
Pricing: USA vs Europe
European online rental market by territory 2005
European online rental market by territory 2009
USA: Online rental as % of total rental market
USA: Online vs offline by value
UK: Online rental as % of total rental market
UK: Online vs offline by value
France: Online rental as % of total rental market
France: Online vs offline by value
Germany: Online rental as % of total rental market
Germany: Online vs offline by value
Spain: Online rental as % of total rental market
Spain: Online vs offline by value
Italy: Online rental as % of total rental market
Italy: Online vs offline by value
Scandinavia: Online rental as % of total rental market
Scandinavia: Online vs offline by value
Benelux: Online rental as % of total rental market
Benelux: Online vs offline by value
Europe: Rental market size and forecasts (2002-2006)
US: Rental market size and forecasts (2002-2006)
Europe: Rental market size and forecasts (2007-2009)
US: Rental market size and forecasts (2007-2009)
UK: Rental market size and forecasts (2002-2006)
France: Rental market size and forecasts (2002-2006)
UK: Rental market size and forecasts (2007-2009)
France: Rental market size and forecasts (2007-2009)
Germany: Rental market size and forecasts (2002-2006)
Spain: Rental market size and forecasts (2002-2006)
Germany: Rental market size and forecasts (2007-2009)
Spain: Rental market size and forecasts (2007-2009)
Scandinavia: Rental market size and forecasts (2002-2006)
Italy: Rental market size and forecasts (2002-2006)
Italy: Rental market size and forecasts (2007-2009)
Scandinavia: Rental market size and forecasts (2007-2009)
Benelux: Rental market size and forecasts (2002-2006)
Benelux: Rental market size and forecasts (2007-2009)

Evolution of the online business model
Emergence of international brands
The online rental conundrum
Video on demand
Next generation DVD