The decline of the disc seems to be one of the defining shifts in consumer commerce in 2006. HMV yesterday issued a profit warning, echoing the disappointing trading update given by Woolworths, which blamed lower CD sales and the fall in DVD prices. The troubles at HMV, the music and books retailer, went wider. Its share of book sales has fallen and it has had difficulties in its international operations. But HMV finds itself squeezed between supermarkets undercutting it on prices for movies and customers shunning CDs for downloads to iPods and MP3s.

This is more about Hollywood than the British high street. The picture emerging from Europe and the US is not good for the DVD. Sales in Europe are expected to fall 5 per cent year-on-year, according to Screen Digest, the second annual decline in Europe. In the US, Circuit City and Best Buy, which sell home entertainment equipment, have reported weak quarters in DVD sales. Richard Greenfield, the Wall Street media analyst, is forecasting that next year will see the first decline in DVD sales in the American domestic market.

The CD is, obviously, struggling against digital downloads and piracy. The DVD’s woes are more complex. The studios are seeking to support sales with heavy price promotion. It has not been a great year for family blockbusters — it was not the year for Harry Potter or The Incredibles, but Cars and Over the Hedge. Perhaps, too, there has been a change in perception of DVDs. They are stacked, these days, in supermarket aisles. Videos can be watched on demand by clicking the remote. People know that a new generation of home movie technology is on the way — HD DVD and Blu-Ray — but it will not be widely available till 2008. They have changed entertainment formats, from vinyl to CD, from VHS to DVD, before. Once bitten and twice shy.

A lot of hot air

The passenger jet, along with television and the Pill, were arguably the three innovations of the 20th century that had the most profound impact on social behaviour — and, mostly, for the good. Air travel has made possible globalisation, not to mention the simple joy of meeting new people and seeing new places.

But airlines find themselves increasingly painted as the chief villains in raising the world’s temperature. They are not. Air travel accounts for about 3 per cent of green-house gas emissions. But the airline industry has copped the wrath of the green movement for good reason. While other industries are reining in their emissions, airlines are on course to double theirs by 2050.

The EU has responded by introducing a carbon trading scheme, which will enable the airlines to buy the right to pollute. This has the potential to encourage good environmental citizenship, but it won’t begin until 2011, when we could all be ankle-deep in water from melted icecaps.

Plane and engine makers are already working on efficiency, but technological improvements will take many years to flow through. The EU’s plan will penalise firms that are already moving towards a greener future.

The Government should intervene to reform behaviour. And not just the airlines’, but ours. “The polluter pays” principle is a good one. If Europe’s politicians are serious about reducing air travel’s environmental impact, then the obvious weapon is a carbon tax on airline fuel.

• Just in time, the weather has turned cold and shoppers are hitting the high street. After some unnecessarily grim predictions mid-month, Verdict is forecasting the biggest Christmas on record: British shoppers are expected to spend £33 billion this December — £673 a head compared with £653 last year.

  But thanks to the warm winter and the wary consumer Christmas, as far as the retail sector is concerned, has come later than ever. This means that it will differentiate between success and failure more aggressively than last year. The companies at the front of the caravan will be the big supermarkets and a few stores such as M&S and John Lewis; at the back will be the shops that started discounting early. They blinked.

  Payment cover failing the poor

  Farepak may be the most dispiriting example of the poor being let down by the financial services industry. But in pounds and pence, payment protection insurance (PPI) is probably the bigger scandal.

  There is strong evidence that banks, insurers and their agents are profiteering. As the Office of Fair Trading points out, the industry typically pays out a derisory 20p in claims for every £1 it brings in as premiums — a claims ratio unknown in any other part of the insurance industry.

  There is growing evidence too, that PPI is frequently mis-sold. There are too many examples of people persuaded to buy PPI when even the most cursory fact-find by the salesman would show that they would never be able to claim on it by virtue of their age or occupation or employment status. Just as in the Farepak case, the victims are frequently the most vulnerable — the innumerate and the poor — and those trying to do the right thing and act responsibly.

  The Financial Services Authority is right to crack down in this area and to judge by the string of cases coming out of its enforcement division, it has uncovered a rich seam of failings. It will be left to the Competition Commission to tackle the wider issue of profiteering and identify remedies that don’t deter those who could benefit from PPI from buying it. A reference is expected early next year.

  james.harding@thetimes.co.uk

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