The meteoric rise in the global popularity and profitability of the DVD format has seen Germany and the UK join the many markets experiencing record business in the sector.

In Germany, the home video industry's turnover exceeded the Euros 1bn mark for the first time ever in 2001, according to statistics published by the video trade body Bundesverband Video (BVV) collated by the GfK market research institute.

Overall turnover on the rental and sales of DVDs and videocassettes reached a new record of Euros 1.146bn in 2001, 22.7% up on the performance of the previous year and Euros 159.1m more than the cinema sector's total box office of Euros 987.2m.

The BVV reported that business with sell-through DVDs and videos increased by 33% from 2000's Euros 593.9m to Euros 790.4m last year thanks to the growing popularity of DVDs in the home entertainment sector. Indeed, DVD sales shot up by an impressive 139% - from Euros 170.4m in 2000 to Euros 406.7m in 2001 - which more than compensated for the 9% shrinkage in the sell-through VHS market (from Euros 423.6m to Euros 383.6m).

Moreover, thanks to the DVD, the industry also had cause for celebration in the rental sector as well. Although the number of rental transactions for VHS cassettes slipped by 5% (119.3m compared to 125.5m in 2000), the number of DVDS rented out climbed year-on-year by a staggering 190% to 15m transactions. As a consequence, overall turnover from DVD and video rentals climbed by 5% to Euros 355.9m from 2000's Euros 340.4m.

Meanwhile, the latest figures from the UK show a supposedly mature market growing by a massive 35% to hit Euros 3.3bn, driven by the rise of DVD. Retail sales for both platforms weighed in at a combined Euros 2.49bn and rentals at Euros 835.2m. In addition, some 4.7 million VCR players were purchased with a total value of Euros 1.1bn and two million DVD players at a cost of Euros 474.6m.

Shrek was the biggest selling video of 2001, with 2.1 million units on VHS and 630,000 on DVD video. Gladiator is the biggest selling DVD video ever, having sold more than 1 million copies across 2000 and 2001.

DVD grew 150% in the sell through sector, while VHS cassettes dropped 4%. The total number of retail videos grew from 18% 114 million in 2000 to 135 million last year.

DVD is also powering up as a rental format. The three fold increase in DVD video rentals to 25 million offset a 9% decline in cassette rental transactions of 162 million, leaving the total volume of videos rented last year to 186 million, the same level as in 2000.

"This time last year the BVA reported 28.7 million video units sold in December 2000 - the best ever recorded. This record was well and truly smashed as total video sales increased by an incredible 20% to exceed 34.3 million units in December 2001," says Lavinia Carey, director general of the British Video Association, provider of the new data.