Private Media Group Inc. has launched the US version of its adult DVD rental subscription service that will offer all of Private's catalogue. The European launch, planned for May, will offer a similar service for most of Europe.
The service, available through Privateathome.com , allows customers to select movies over the Internet from Private's award-winning library of DVDs...over 400 existing titles with nine new releases every month. For a flat monthly fee, movies are delivered to consumers by mail in postage-paid return envelopes and can be returned at any time.
With the installed base of DVD players growing from 55.9 million U.S. households this year to 97.6 million in 2007, annual spending on DVD rentals is anticipated to soar from $3.2 billion to $8.4 billion during the next five years, predicts Adams Media Research of Carmel, California. Industry sources have estimated that over 20% of the US DVD rental market is composed of adult titles.
"The launch of Privateathome.com is a natural progression of our strategy to gain access to the huge retail margins applied to our products," said Charles Prast, president and CEO of Private Media Group. "With over one million U.S. consumers subscribing to on-line DVD rental subscription services, coupled with the popularity of adult DVDs, we are not surprised that the U.S. launch of Privateathome.com has been so well received."
Noting the success of the online Private shop, where Prast reports sales have almost doubled in the last six months since the site was upgraded, Prast is confident the new business will succeed. Being a content producer may provide some advantages to the new business venture.
"Since we own all of our content, we can provide an unlimited number of every title so that our subscribers will never have to wait for delivery. As Netflix and other popular services in the U.S. have chosen to remain outside of the adult marketplace, this is a natural opportunity for Private," said Prast.
Private expects that their European launch of the same service will be even more profitable. In Europe, consumers pay more for adult DVDs than consumers in the U.S, and Private is considered a household name in Europe. Prast estimates that in both the U.S. and Europe, Private will gain net profits of $80,000 per 1,000 annual subscribers.
