DVD continues to amaze.

‘Not in our wildest dreams’ did anyone expect the format to accelerate ‘from zero to 60 in about three years, ’ said International Recording Media Association president Charles Van Horn, introducing IRMA’s latest statistical review of the optical media market at a news conference in New York today.

This year, Van Horn continued, DVD will achieve the ‘very difficult’ goal of a 10% penetration of U.S. households. IRMA has regularly upgraded its estimate of the installed base of players, as sales exceeded predictions, and now projects 175 million DVD-capable machines will be in homes around the world by 2004. The total includes stand-alone players, personal computers and DVD-playing game consoles like Sony’s PlayStation 2.

It does not include DVD Audio, which has proved harder to launch ‘than anticipated,’ Van Horn noted. He doesn’t expect much in the way of audio player availability until next year, with another 18 to 24 months required to build catalog.

DVD and VHS remain on friendly terms, according to Van Horn. ‘If there’s been any decline [in cassette duplication], it has been gradual,’ he said. Duplicators are reporting another strong year, in part because consumers ‘still want’ VCRs.

IRMA sticks to its earlier estimate that the two formats can continue to coexist for the next three or four years. DVD, however, has made inroads in one genre never comfortable with tape: music videos.

BMG Entertainment V.P. Louis Vaccarelli, speaking at the IRMA meeting held in BMG’s New York offices, said DVD sales of pop groups and individual artists have topped 1 million discs so far this year. ‘Kids don’t watch them once, they watch them three or four times,’ he said. The extras account for much of the interest, he added.

The music market ‘never existed’ for VHS, so this is ‘incremental business,’ Van Horn said.