El Segundo, Calif. – Despite intensified competition in
2010, Apple continued to dominate the U.S. market for online movies, accounting
for 64.5% of consumer spending, down from 74.4% in 2009, according to a report
from market research firm Screen Digest.

Total U.S. revenues from electronic sell-through
(EST) and Internet video-on-demand were up more than 60% in 2010.

Behind Apple,
Microsoft’s Zune Video platform accounted for 17.9% of consumer spending in
2010, up from 11.6% in 2009, while Sony grabbed 7.2%, up from 5.7% in 2009.

the report pegs Wal-Mart’s aggressive discounting of movie titles on its Vudu
service to 99 cents in the fourth quarter as a sign it may become Apple’s
biggest rival in the future.

"Apple faced serious competition from
Microsoft’s Zune Video and Sony Corp.’s PlayStation Store, as well as from
Amazon and — most significantly — Wal-Mart," said IHS research director
Arash Amel.

"However, iTunes managed to grow because of the introductions
of the iPad and the second-generation Apple TV, which have spurred the
company’s movie rental offerings and have invigorated the iTunes multi-screen
ecosystem. We expect that in the United States, Apple’s strong performance in
iVOD will allow it to continue to bypass the video on demand services offered
by many major cable operators."

"The future of the online movie
business may come down to competitive battle between Apple and Wal-Mart,"
Amel added.

"Although Wal-Mart is not on the charts yet, the company soon
will become a major player if its current momentum continues."


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