Home Entertainment Market Assessment 2008

The UK home-entertainment market consists of three main sectors: television, video and DVD; audio equipment; and PCs and games consoles. The value of the total UK retail market for home-entertainment equipment was £7.32bn in 2007, a 7.2% increase on 2003.

Sales of televisions have been boosted by the trend towards larger screens, as well as digital and high-definition (HD) sets. However, value growth has been restricted by price erosion. The value of the video and DVD systems sector declined between 2003 and 2007.

The audio-equipment sector has performed particularly well, with both the portable and non-portable segments showing sales growth between 2003 and 2007; MP3 players, in particular, have driven sales of portable audio equipment.

Total sales of PCs are growing, although this masks the fact that sales of desktop PCs are declining while those of laptops are rising. Sales of games consoles are fairly erratic, depending on new product launches, but performed well in 2007.

Value sales of home-entertainment equipment are expected to slow between 2008 and 2012. The credit crunch means that consumers will be less likely to purchase `high-ticket' items such as televisions. At the same time, sales of DVD systems, video players and desktop computers will decline, as they are superseded by more up-to-date technology.

Executive Summary

1. Introduction
OVERVIEW
DEFINITION
Television, Video and DVD
Televisions
DVD Systems and Video Players
Audio Equipment
Non-Portable Audio Equipment
Hi-Fi Systems
Audio Separates
Portable Audio Equipment
PCs and Games Consoles
PCs
Games Consoles

2. Strategic Overview
MARKET DYNAMICS AND SEGMENTATION
Total Market Size
Table 1: The UK Home-Entertainment Market by Sector by Value (£m at rsp), 2003-2007
Figure 1: The UK Home-Entertainment Market by Sector by Value (£m at rsp), 2003-2007
By Market Sector
Televisions
PCs
Non-Portable Audio Equipment
DVD Systems and Video Players
Games Consoles
Portable Audio Equipment
ADVERTISING
Table 2: Main Media Advertising Expenditure by Electrical Retailers (£000), Years Ending December 2004-2007
THE CONSUMER
Table 3: Penetration of Home-Entertainment Equipment (% of adults), 2001 and 2006/2007
MARKET FORECASTS
Table 4: The Forecast UK Home-Entertainment Market by Value (£m at rsp), 2008-2012

3. Television, Video and DVD
BACKGROUND
MARKET SIZE
Table 5: The UK Televisions, Video Players and DVD Systems Market by Value (£m at rsp and index 2003=100), 2003-2007
MARKET SECTORS
Televisions
Table 6: The UK Televisions Sector by Value (£m at rsp and index 2003=100), 2003-2007
Flat-Screen Televisions
The Digital Switchover
High-Definition Television
Internet Television
DVD Systems and Video Players
Table 7: The UK DVD Systems and Video Players Sector by Value (£m at rsp and index 2003=100), 2003-2007
Blu-ray versus HD-DVD
CONSUMER TRENDS
Television
Penetration
Table 8: Penetration of Television Sets by Sex, Age, Social Grade and Region (% of adults), 2006/2007
Ownership of Satellite and Cable Television
Ownership of Home Cinemas
Table 9: Penetration of Home-Cinema Systems† by Sex, Age, Social Grade and Region (% of adults), 2006/2007
Number of Televisions Owned
Table 10: Number of Television Sets per Household (% of adults), 2006/2007
Size of Televisions Owned
Table 11: Size of Television Screens Owned (% of adults), 2006/2007
Types of Television Screens Owned
Table 12: Type of Television Screens Owned (% of adults), 2006/2007
Where Televisions are Viewed
Table 13: Location of Televisions in the House (% of adults), 2006/2007
Time Spent Watching Television
Amount Spent on Televisions
Table 14: Cost of Television Sets Purchased within the Past 12 Months (% of adults), 2006/2007
Replacement Rates
Table 15: When the Main Television Set was Obtained (% of adults), 2006/2007
Factors Influencing Purchases
Table 16: Most Important Factors Influencing the Purchase of a Television Set (% of adults), 2006/2007
Attitudes Towards New Television Technology
Impact of the Digital Switchover on Purchases
Planning for the Digital Switchover
Attitudes Towards High-Definition Television
Attitudes Towards Watching Television via the Internet
Attitudes Towards Home-Entertainment Systems
DVD Players and Recorders
Ownership of DVD Players
Table 17: Penetration and Purchasing of DVD Players† by Sex, Age, Social Grade and Region (% of adults), 2006/2007
Ownership of Portable DVD Players
Table 18: Penetration and Purchasing of Portable DVD Players by Sex, Age, Social Grade and Region (% of adults), 2006/2007
Ownership of DVD Recorders
Table 19: Penetration and Purchasing of DVD Recorders by Sex, Age, Social Grade and Region (% of adults), 2006/2007
Attitudes Towards New DVD Technology
DVD Recorders With a Hard Drive
HD-DVD versus Blu-Ray
MARKETING ACTIVITY
Table 20: Main Media Advertising Expenditure on Television Sets and Satellite Systems, DVD and Video Recorders/Players and Blu-Ray/HD-DVD Players (£000), Years Ending December 2004-2007
Television Sets and Satellite Systems
Table 21: Main Media Advertising Expenditure on Television Sets and Satellite Systems by Company (£000), Years Ending December 2006 and 2007
Video Players and DVD Systems
Table 22: Main Media Advertising Expenditure on DVD and Video Recorders/Players and Blu-ray/HD-DVD Players by Company (£000), Years Ending December 2006 and 2007
DISTRIBUTION

4. Audio Equipment
BACKGROUND
MARKET SIZE
Table 23: The UK Audio Equipment Market by Value (£m at rsp and index 2003=100), 2003-2007
MARKET SECTORS
Non-Portable Audio Equipment
Table 24: The UK Non-Portable Audio Equipment Sector by Value (£m at rsp and index 2003=100), 2003-2007
Portable Audio Equipment
Table 25: The UK Portable Audio Equipment Sector by Value (£m at rsp and index 2003=100), 2003-2007
CONSUMER TRENDS
Non-Portable Audio Equipment
Mini Systems
Table 26: Penetration and Purchasing of Mini Systems by Sex, Age, Social Grade and Region (% of adults), 2006/2007
Midi Systems
Table 27: Penetration and Purchasing of Midi Systems by Sex, Age, Social Grade and Region (% of adults), 2006/2007
Micro Systems
Table 28: Penetration and Purchasing of Micro Systems by Sex, Age, Social Grade and Region (% of adults), 2006/2007
CD Players
Table 29: Penetration and Purchasing of a Separate CD Player by Sex, Age, Social Grade and Region (% of adults), 2006/2007
Hi-Fi Separates
Table 30: Penetration and Purchasing of Separate Hi-Fi Components by Sex, Age, Social Grade and Region (% of adults), 2006/2007
Portable Audio Equipment
DAB Radios
Table 31: Penetration and Purchasing of DAB Digital Radios by Sex, Age, Social Grade and Region (% of adults), 2006/2007
Personal DAB Radios
Table 32: Penetration and Purchasing of Personal DAB Digital Radios by Sex, Age, Social Grade and Region (% of adults), 2006/2007
Personal CD Players
Table 33: Penetration and Purchasing of Personal CD Players by Sex, Age, Social Grade and Region (% of adults), 2006/2007
MP3 and MP4 Players
Table 34: Penetration and Purchasing of MP3 and MP4 Players by Sex, Age, Social Grade and Region (% of adults), 2006/2007
Downloading Music
MARKETING ACTIVITY
Table 35: Main Media Advertising Expenditure on Audio Equipment (£000), Years Ending December 2006 and 2007
Table 36: Main Media Advertising Expenditure on Audio Equipment by Type of Equipment and/or Company (£000), Year Ending December 2007
DISTRIBUTION

5. PCs and Games Consoles
BACKGROUND
MARKET SIZE
Table 37: The UK PCs and Games Consoles Market by Value (£m at rsp and index 2003=100), 2003-2007
MARKET SECTORS
PCs
Table 38: The UK PCs Sector by Value (£m at rsp and index 2003=100), 2003-2007
Games Consoles
Table 39: The UK Games Consoles Sector by Value (£m at rsp and index 2003=100), 2003-2007
CONSUMER TRENDS
PCs
Computers in the Home
Table 40: Penetration of PCs (% of adults), 2006/2007
Ownership of Desktop Computers
Table 41: Penetration of Desktop Computers by Sex, Age, Social Grade and Region (% of adults), 2006/2007
Ownership of Laptop Computers
Table 42: Penetration of Laptop Computers by Sex, Age, Social Grade and Region (% of adults), 2006/2007
Computer Usage
Table 43: Computer Usage (% of adults), 2006/2007
Time Spent Using Computers
Table 44: Number of Hours per Week Spent Using the Computer (% of adults), 2006/2007
Factors Affecting Purchase
Table 45: Factors Influencing the Purchase of a Home Computer (% of adults), 2006/2007
Games Consoles
Ownership of Games Consoles
Type of Console Owned
Expenditure on Consoles and Games
Table 46: Expenditure on Consoles and Games in the Past 12 Months (% of adults), 2006/2007
Time Spent Playing Computer Games
Table 47: Hours per Week Spent Playing Games on Computer Consoles (% of adults), 2006/2007
The Internet
Access and Type
MARKETING ACTIVITY
PCs
Table 48: Main Media Advertising Expenditure on Home PCs by Type (£000), Years Ending December 2006 and 2007
Games Consoles
Table 49: Main Media Advertising Expenditure on Games Consoles by Company (£000), Years Ending December 2006 and 2007
DISTRIBUTION

6. An International Perspective
MARKET DEVELOPMENTS AND CONSUMER BEHAVIOUR
Table 50: Annual GDP Growth Rates for the EU 27 and the US (%), 2002-2007

7. PEST Analysis
POLITICAL FACTORS
ECONOMIC FACTORS
Gross Domestic Product
Table 51: UK Gross Domestic Product at Current Prices and Annual Chain-Linked Prices (£m), 2003-2007
Disposable Income
Table 52: UK Household Disposable Income per Capita (£), 2003-2007
SOCIAL FACTORS
Table 53: The Forecast UK Population by Age (000), 2007 and 2012
TECHNOLOGICAL FACTORS

8. Consumer Dynamics
OVERVIEW
Table 54: Selected Results for Ownership of and Attitudes Towards Home-Entertainment Equipment (% of respondents)
TELEVISIONS
"I Have Satellite/Cable Television"
Table 55: Ownership of Satellite/Cable Television (% of respondents)
"How Many Hours Do You Spend Watching Television on an Average Weekday?"
Table 56: Number of Hours Spent Watching Television (% of respondents)
"More Than 6 Hours"
Table 57: Those Spending More Than 6 Hours Watching Television a Day (% of respondents)
"I Am Delaying Television Purchases Until Analogue Television is Phased Out"
Table 58: Delaying Purchasing a Television Until the Digital Switchover (% of respondents)
"What Will You Do When the Digital Switchover Happens?"
Table 59: Planning for the Digital Switchover (% of respondents)
"Buy a New Digital Television"
"Upgrade Rental Package"
Table 60: Planning for the Digital Switchover — Buy a New Television and Upgrade Rental Package (% of respondents)
"Buy a Box"
"Nothing, as I Already have Equipment to Receive Digital Signals"
Table 61: Planning for the Digital Switchover — Buy a Box, and Already Own Equipment That Receives Digital Signals (% of respondents)
High-Definition Television
"I Own an HDTV"
"(If No) I Plan to Buy an HDTV in the Next 5 Years"
Table 62: Ownership and Planned Purchase of High-Definition Televisions (% of respondents)
"I'd Like to be Able to Watch Television via the Internet"
Table 63: Interest in Watching Television via the Internet (% of respondents)
HOME-ENTERTAINMENT SYSTEMS
"I Would Prefer to Buy a Home-Entertainment System, i.e. Television, Video, DVD and Hi-Fi All in One, Rather than Buying them Separately"
Table 64: Preference for Buying a Home-Entertainment System (% of respondents)
DVD PLAYERS AND RECORDERS
"I Own a DVD/HDD Recorder (DVD Recorder with Hard Drive — Can Pause Live Television, etc.)"
"The Price of the New HD-DVD/Blu-ray DVD Players Puts me off Buying One"
Table 65: Ownership of DVD/HDD Recorders and Attitudes Towards HD-DVD/Blu-ray DVD Players (% of respondents)
"I am Waiting to See Which Format (HD-DVD or Blu-ray) Proves Most Popular Before Buying a New DVD Player"
Table 66: Waiting to See Which Format Proves Most Popular Before Buying a DVD Player (% of respondents)
DOWNLOADING MUSIC
"I Tend to Download Music Rather than Buy CDs"
Table 67: Tendency to Download Music (% of respondents)
COMPUTERS AND GAMES CONSOLES
"Do You or Anyone in Your House Own a Games Console?"
Table 68: Ownership of Games Consoles (% of respondents)
"What Type of Games Console do You Own?"
Table 69: Type of Games Console Owned (% of respondents owning)
"Sony PSP"
"Sony PS1"
Table 70: Type of Games Console Owned — Sony PSP and Sony PS1 (% of respondents owning)
"Sony PS2"
"Sony PS3"
Table 71: Type of Games Console Owned — Sony PS2 and Sony PS3 (% of respondents owning)
"Xbox"
"Xbox 360"
Table 72: Type of Games Console Owned — Xbox and Xbox 360 (% of respondents owning)
"Nintendo DS"
"Nintendo Game Cube"
Table 73: Type of Games Console Owned — Nintendo DS and Nintendo Game Cube (% of respondents owning)
"Nintendo Game Boy"
"Nintendo Wii"
Table 74: Type of Games Console Owned — Nintendo Game Boy and Nintendo Wii (% of respondents owning)
INTERNET ACCESS
"I Have an Internet Connection at Home"
"(If Yes) is it Wireless?"
Table 75: Internet Connections in the Home (% of respondents)

9. Supplier Profiles
APPLE (UK) LTD
Company Information
Product Information
Recent Developments
Profitability
Table 76: Financial Results for Apple (UK) Ltd (£000 and %), Years Ending 25th September 2004 and 24th September 2005 and 53 Weeks Ending 30th September 2006
DELL CORPORATION LTD
Company Information
Brand Information
Recent Developments
Profitability
Table 77: Financial Results for Dell Corporation Ltd (£000 and %), Year Ending 28th January 2005, 53 Weeks Ending 3rd February 2006 and Year Ending 2nd February 2007
MICROSOFT LTD
Company Information
Brand Information
Recent Developments
Profitability
Table 78: Financial Results for Microsoft Ltd (£000 and %), 53 Weeks Ending 2nd July 2004 and Years Ending 1st July 2005 and 30th June 2006
PANASONIC MANUFACTURING UK LTD
Company Information
Recent Developments
Profitability
Table 79: Financial Results for Panasonic Manufacturing UK Ltd (£000 and %), Years Ending 31st March 2005-2007
PHILIPS ELECTRONICS UK LTD
Company Information
Product Information
Recent Developments
Profitability
Table 80: Financial Results for Philips Electronics UK Ltd (£000 and %), Years Ending 31st December 2004-2006
SAMSUNG UK LTD
Company Information
Brand Information
Recent Developments
Profitability
Table 81: Financial Results for Samsung UK Ltd (£000 and %), Years Ending 31st December 2004-2006
SHARP ELECTRONICS (UK) LTD
Company Information
Product Information
Recent Developments
Profitability
Table 82: Financial Results for Sharp Electronics (UK) Ltd (£000 and %), Years Ending 31st March 2004-2006
SONY UNITED KINGDOM LTD
Company Information
Product Information
Recent Developments
Profitability
Table 83: Financial Results for Sony United Kingdom Ltd (£000 and %), Years Ending 31st March 2005-2007

10. The Future
MARKET FORECASTS
The Total Market
Table 84: The Forecast UK Home-Entertainment Market by Sector by Value (£m at rsp), 2008-2012
Figure 2: The UK Home-Entertainment Market by Value (£m at rsp), 2003-2012
Market Sectors

11. Further Sources
Associations
Publications
General Sources
Government Sources
Other Sources
Bisnode Sources

Apple (UK) Ltd
Dell Corporation Ltd
Microsoft Ltd
Panasonic Manufacturing UK Ltd
Philips Electronics UK Ltd
Samsung UK Ltd
Sharp Electronics (UK) Ltd
Sony United Kingdom Ltd