"Worldwide movie sales on DVD are likely to be nearing their peak as more people look to computer downloads and video-on-demand to watch their favourite programming, a new report says.

"The PC industry is champing at the bit to provide downloaded movies that might compete with DVD sales, and Pay-TV services want to add movies to their video-on-demand services, to their new disk-drive-equipped set-top boxes, and to their emerging high-definition TV services," said Gerry Kaufhold, an In-Stat analyst and author of the report.

DVD sales growth is slowing, according to several recent reports. A study released by Adams Media Research in October forecast DVD sales of about $US17.3 billion ($23.1 billion) this year, a 12 per cent rise from 2004. Adams forecast a 9 per cent rise to $US18.9 billion in 2006.

The industry also is grappling with a scuffle over what technology will underpin the new wave of high-definition DVDs, the report said.

"The migration to next-generation high-definition optical disc formats is not going smoothly," Mr Kaufhold said.

On one side is Sony with its Blu-ray format and studio supporters such as Metro-Goldwyn-Mayer and Fox. The rival format is HD DVD, championed by a group of consumer electronics companies including Toshiba." [link]