DVD rush doesn't alter rental habit. (Media & Technology).

The explosion of DVD sales has done little to alter the basic question of movie consumers: To rent or to buy?

While rentals remain a significant revenue stream, rental outlets are increasingly adding DVD product to their for-sale shelves.

The U.S. top rental titles in 2002 were Fox's "Don't Say a Word," Warner Bros.' "Ocean's Eleven" and "Training Day," according to trade publication Video Business. The bestsellers were "Monster's Inc.," "Lord of the Rings: The Fellowship of the Ring" and "Spider-Man," blockbusters released by Buena Vista, Warner Bros. and Columbia TriStar, respectively.

"Some of the rental chains are promoting (larger films) as a sell-through product to their own customers. So we definitely see less rental activity on titles like that," said Joel Goldman, vice president of sales for Columbia TriStar Home Entertainment. "And the bigger the sales volume, the smaller the rental market because, obviously, the people who buy the product will never rent it."

Generally, blockbuster movies with spectacular effects have emerged as leading titles for sale, while lesser-known films are still considered renters. Family titles have always performed well as sell-through titles.

That's not altogether different from the days before DVD -- customers bought blockbuster videos with greater frequency than those of smaller films. But the effect has become more pronounced as consumers build up their home film libraries.

The rental business continues to plug along because of several factors, including the slower-than-expected development of video-on-demand services and the growth of the DVD market.

In a report on Dallas-based Blockbuster Inc., Salomon Smith Barney analyst Margaret Blaydes warned that, "consumers do not have an unlimited appetite for buying DVDs and that certain titles make better 'renters' than 'sellers.'

"Early evidence suggests that early DVD adopters are returning to renting, but with mass market consumers still early in the DVD library-building game, it is unclear how long it will take before retail sales stabilize," she wrote.

Rental vs. Sales

Top 10 Rentals in 2002

Film                           Revenue
                            (In millions)

Don't Say a Word                 $84
Oceans Eleven                   82.2
Training Day                    79.5
The Fast and the Furious        70.7
The Others                      64.5
American Pie 2                  61.1
Domestic Disturbance              61
Rat Race                        58.8
Shallow Hal                     60.9
Vanilla Sky                     59.5
Monsters Inc.                   $347
The Lord of the Rings: The
 Fellowship of the Ring          330
Spider-Man                       299
Harry Potter and the
 Sorcerer's Stone                298
Ice Age                          203
Lila & Stitch                    198
Star Wars: Episode II
Attack of the Cloness            188
The Fast and the Furious         146
Atlantis: The Lost Empire        130
Goldmember                       121

Source: Video Business