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Media and Entertainment 2007: By the Numbers Recap

New years seem to start with a tempered excitement.  As a symbolic beginning, we’re prone to look ahead anxious of the unknown.  As a symbolic end, we’re drawn  to look back and take inventory of what has passed.  Where have we been? What have we done? And, most of all,  where are we going?

chartsIn the mix, the glass is neither half full nor half empty.  In the beginning of a new year, it is just there with some liquid in it open to all voices to call it what they will.   Looking back is a means of measuring where momentum is taking us. Corporate earnings, personal achievements (or faults), annualized statistics: all numbers and quantities to set benchmarks and goals.

In some ways, it is illogical. The past doesn’t predict the future. As Warren Buffett once said, “If past history was all there was to the game, the richest people would be librarians.”  On the other hand, momentum is a continuous line and it does help to gauge its slope.

Late last week, NPD Group released their annual recap for the gaming industry in 2007.  Across the board, from Sony, to Microsoft, to Activision and Electronic Arts, especially Nintendo, all found varying degrees of success. For 2007, the industry boomed.

Elsewhere numbers accumulating from the conclusions of year-end accounting tell different stories.  This edition of Metue’s: “By the Numbers” gathers some of those statistics from industries influenced by the convergence of Media, Entertainment and Technology.


by numbers

moneybag  Media M&A Activity
•There were 838 Mergers or Acquisitions characterized as media industry deals in 2007. That was a 32% increase over 2006. The total dollar value of the deals was up 79% to $108b.

•Online media accounted for 306 deals totaling $11.9b.

•Newspaper publishing deals dropped from 74 in 2006 to just 45 in 2007. (via Jordan Edmiston Group).

headphones   Music Sales
•500.5m albums sold in 2007, a 15% decrease over 2006. If digital tracks were counted in 10 track equivalents to approximate albums, the annual drop in album sales decreases to 9.5%

•Total music purchases including albums, digital tracks and music videos was up 14% over 2006 to 1.35b units.

•Josh Groban’s Christmas collection "Noel" was the year’s best seller with 3.7m copies sold. Disney’s "High School Musical" soundtrack was second with approximately 2.9m sold. The Eagles "Long Road Out of Eden" was third with 2.6m sold.

•Among the labels, Vivendi’s Universal finished first in market share with 31.9%. Sony BMG was second with 24.97%. Warner Music was third with 20.2%. EMI was 4th with 9.3%.

•50m albums were downloaded, a 53% increase. 23% of music sales were from digital purchases.
(via Nielsen SoundScan)

controller   U.S. Video Game Industry
•Total hardware, accessories and software sales for 2007 were up 43% to $17.94b. Hardware accounted for $7.04b. Software yielded $8.6b.

•Halo 3 finished as the top game of the year with 4.82m copies sold. The Nintendo DS was the best selling portable and total sales leader with 8.5m units sold. The Wii was the top console with 6.29m. (more detail on the U.S. games market can be seen in this related coverage of NPD’s gaming survey)

camera   Movie Studios
•U.S. domestic box office results set a record at $9.62b in total receipts. 5 studios grossed more than a billion dollars each.

•Paramount had the strongest year with two movies grossing more than $300m: “Transformers” ($319) and “Shrek the Third” ($321m). Their market share was 15.5%, up from 10.4% in 2006. Total gross for Paramount was $1.49b.

•”Harry Potter” lifted Warner Brother’s to the second spot. “Harry” brought in $292m, the 300 earned upwards of $210 and “I am Legend broke” $200m before the calendar shifted to 2008. Total gross was $1.42b, 14.7 percent of the market.

Disney finished 3rd with $1.36b (14.1% market share). Sony 4th with $1.24b (12.9% market share). Universal and Fox finished 5th and 6th in market share with 11.4% and 10.5% respectively.
(via Hollywood Reporter & Box Office Mojo).

apple up   Private Equity & Venture Capital Capitalization
•Even with credit issues looming like a storm cloud, 415 funds raised $302b in 2007. 75% of that capital went to Leveraged Buyout Funds with 183 funds raising $228b. Blackstone Capital Partners V LP single handedly set a record for the largest deal with a $21.7b fund.

•22 Funds focused on distressed companies raised $45b, up from $16b in 2006

•Venture Capital funds raised about $34b, up 9.4% from 2006. It was the largest year of fund raising since 2001. Technology Crossover Ventures took the biggest bounty raising $3b for the later-stage focused TCV VII LP fund. (via Thompson and Dow Jones Private Equity Analyst)

• U.S. Venture investments were up 11% over 2006 to about $29b. That money was spread over 3,813 deals. 748 deals, or $4.6b were Internet focused. (via PWC MoneyTree)

controller   Japanese Video Games
•Combined hardware and software sales were up 10% over 2006 to $6.3b (687.76b Yen). Nintendo took the number one and two position for total sales. The DS portable finished first with 7.1m units (21 LTD in Japan). The Wii sold 3.6m consoles.

Sony’s PS3 sold 1.2m consoles. Microsoft’s Xbox 360 only 257,800. (via Enterbrain).

up sign   Social Networking
•In a category of fifty three social networking websites, MySpace averaged 76.35% of all U.S. visits in 2007. Facebook was second with 12.57%. Bebo was third with 0.87% of visits. Overall traffic to social networking sites was up 4% year over year from 2006 (via Hitwise).

plasma   Top TV Advertising Product Placements
•Between January 1st and October 31st of 2007, Coca Cola soft drinks appeared 3,126 times within TV shows. Dell Computers: 665 times. HP Computers: 546.

•The bulk of this kind of advertising occurred on reality programs. American Idol was the biggest billboard with 4,349 brand appearances. America’s Top Model: 2,281. Deal or no Deal: 1,964. Hell’s Kitchen: 1,755 (via Nielsen Monitor)

btn   Yahoo’s Top 10 Tech Searches (from 1 to 10)
•YouTube, Wikipedia, Facebook, iTunes, iPod, iPhone, Nintendo Wii, Xbox, Sony PS3, Guitar Hero


Related Articles
NPD December and 2007 Gaming Results
By the Numbers, Episode 3: Media Stats
By the Numbers: Episode 2: Media Stats
By the Numbers, Episode 1: June

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