Digital downloads of films, music and video games have reached one billion pounds for the first time, official industry figures have confirmed.
The Entertainment Retailers Association said a quarter of the entertainment market is now digital.
Although overall sales rose by 11.4 per cent from 2011, hitting £1.03 billion, sales of CDs, DVDs, Blu-ray and video games fell by 17.6 per cent, a media report said.
According to the report, video games, which have a much higher retail price than CDs and DVDs, accounted for £552 million, rising 7.7 per cent year on year.
It was film, however, which rose most as download services such as Apples iTunes succeeded in persuading users to download video en masse for the first time.
ERA director general Kim Bayley said breaching the £one billion barrier is an incredible achievement for the UKs digital entertainment retailers and reflects their huge investment in new and innovative services which means you can buy music, video and games literally at any time of the day and wherever you are.
He, however, added that physical sales would remain a major force for the time being, the report added.