HD-DVD/Blu-Ray Merger Possible? (1 Viewer)

[Nils Luehrmann]

Regardless of the format war, the potential market for pre-recorded HiDef DVD content (films mostly) is miniscule and will remain so for several more years. There are very few consumers who even have a display that could take advantage of an HD image, of those few that do, only a fraction of those have HD displays with HDMI or DVI, and of those many either do not have a display large enough to notice a big difference, or they simply do not care.

The real market where serious dollars are at stake is in the PC and recorder market (TIVO, etc), but even here, the IDC still only predicts blue laser recorders to account for less than 10% of the total number of DVD recorders sold by 2012. Therefore, for now, and for at least the next several years, standard DVD will remain the sales king in both hardware and software.

Once again, what the format war does bring is better products and significantly lower prices. Because of this we early adopters will have the opportunity to purchase both players for less than what we would have likely had to pay if there was only one non-competing format - and best of all both will have specs better than what we would have had without the format war. As an added bonus, we will also have many more HD titles to choose from as well. So far the format war is a win-win scenario for consumers regardless of whether one format wins or not.

I think those figures are pretty far off. So far the following studios have publicly supported Blu-Ray:

• Columbia TriStar (Sony)
• MGM (Sony)
• 20th Century Fox
• Walt Disney (Disney)
• Buena Vista (Disney)
• Touchstone (Disney)
• Miramax (Disney)
• Dimension Films (Disney)
• Pixar (Disney)
• Hollywood Pictures (Disney)

Looking at both their library of films, number of DVD releases, and video sales, these companies account for a much larger market segment than Warner, New Line, Universal, and even Paramount combined.

I believe people will be genuinely surprised how many more titles will be available on Blu-Ray compared to HD-DVD by the end of 2006, and certainly by 2007. Sony is working quite vigorously in preparation for a massive number of HD releases, and you can count on both Disney and Fox to also make a serious effort early on as both already have HD masters of many of their popular titles.

 

[DaViD Boulet]

My thoughts:

http://www.hometheaterforum.com/htfo...hreadid=230325

 

[Jeff Adkins]

I got those numbers from an article in Video Store Magazine referring to the current DVD market-share of the respective studios. After the aquisition of MGM, Sony is now the biggest. But the vast libraries of Paramount (which includes the CBS Films library), Universal and Warner (which includes the pre-86 MGM library) are pretty huge. Disney's library is pretty small in comparison.

Nonetheless, I still want BR to win.

 

[DaViD Boulet]

If you want BR to win, feel free to post your support of it (or a unified format that provides its level of performance) here:

http://www.hometheaterforum.com/htfo...hreadid=230325

 

[Joshua Clinard]

Disney controls less than 600 feature films. Pretty small library if you ask me. This includes all of their subsidiary studios except Miramax.

 

[Edwin-S]

I don't agree that a format war necessarily brings about significantly lower prices. Betamax and VHS engaged in a format war and the prices of VCRs did not decline rapidly.
When I bought my Betamax in 1980 the price was 1500 Canadian dollars. Five or six years later I, and my sister, bought my dad a four head, stereo VHS machine. The price then was approx. 1000 Canadian dollars. Ten years later that machine "calfed". I then purchased a six head, stereo VHS and that machine cost 700 Canadian dollars. A person certainly did get more for less money, but I would not say that a format war rapidly brought significantly lower prices in the VCR arena. VCR prices only began to drop significantly when it became apparent that a new technology was arriving in the marketplace: in this case DVD players. The price of VCRs fell rapidly as retailers attempted to "blow off" inventory, because retailers realized the new format was going to dominate the market.

The Betamax/VHS format war did foster quicker technological improvements in the machines, but the war had less impact on the pricing of the machines.

I have to add. Look at DVD players which arrived on the market with a unified standard. Eight years later you can buy a progressive scan machine with all the bells and whistles for 50 bucks. Eight years ago, when I bought my interlaced player, the price was 700 Canadian dollars. Mind you, I still think that the PQ of my interlaced player is still better than the PQ of the 50 dollar region-free progressive scan that I bought.

 

[WillardK]

I tend to agree with this comparison. At most the earliest adopters alone will benefit from competetive pricing but I wouldn't even jump to that conclusion. Nope, haven't found that silver lining yet.

...and of course, if those earliest adopters only needed to buy one format they might very well save even more, no?

 

[Nils Luehrmann]

Besides the fact that Buena Vista controls the distribution rights of over 2,500 films, Fox with over 5,000 films, and Sony now controlling the rights to over 7,500 films - if you also consider sales, and consider that the target market for HD titles will be the big blockbuster films, it is quite clear that studios supporting Blu-Ray have the advantage. That is not to say there aren't plenty of titles that in my opinion would be "must own" HD releases from Warner, New Line, Universal, and Paramount - but the advantage in numbers is still on the side of Blu-Ray.

Perhaps it is best to wait until next year, and then we can see real releases from both sides and be able to compare... I just would not recommend placing any wagers on HD-DVD as having the advantage in software sales or for that matter even HD titles by 2007.

As someone who was an early adopter of Betamax I can guarantee that at least here in the States, prices of both Betmax and VHS recorders dropped significantly during their battle - mostly it was Betamax that dropped its price as it was always priced higher than equivalent VHS units.

Nevertheless, we do not even have to speculate on the effect the HD format war has had. We have already seen original price quotes from these companies drop from $3,000+ to $1,000- for HD players and have seen significant improvements in specs and neither format has even been released yet (at least not in the States).

 

[Craig F]

Nils,

When did Fox announce they would release Blu-ray discs? Yes, they joined the Blu-ray group but they also belong to the DVD Forum. But unless something has changed recently, they have not announced they would release Blu-ray discs.

 

[GlennH]

DaVid, your second post with the link to the other thread is not a real link (looks like you copy/pasted from your first post and it just used the "..." instead of the actual characters in the link).

Also, to all, allow me to be a bit pedantic: the correct spelling of the format is Blu-ray. Not BluRay or Blu-Ray or Blue-ray.

 

[Jack Briggs]

Yes, that's correct: Blu-ray. And HD DVD has no hyphen. And people will never get it.

 

[DaViD Boulet]

 

[GlennH]

I'll admit, I'm guilty of using a hyphen in HD DVD.

Whatever they're called, I just want them to (eventually) unify, either via a single disc format or universal players, be priced comparably to DVD, pass full HD resolution via analog component and get here quickly. Is that so much to ask?

 

[WillardK]

Isn't it just as easy to posit that prices have already lowered due to the realization of a harder than initially anticipated sell? The discs themselves are likely to be reasonably priced for this very reason.

Beyond the immediate, prices would lower anyway just as they plummeted with dvd players. Other than a technological push, I don't see the advantages outweighing the disadvantages here.

 

[JayMacey]

I think what many people are missing here anyway is that both formats are going to burst.

DVD is the fastest selling home entertainment product in history with a higher penetration comparably, to any other HE product before it.

You have Grandpa & Aunt Tilley just purchasing their DVD players now and switching their library over.

You WONT be able to convince middle America (which is what it will take for them to be successful) to switch their libraries over.

They won't be able to see the difference between DVD & HD, if they DO, it won't be drastic enough to have them convert over.

Going from VHS to DVD was a drastic difference, INCLUDING the ease of the format (not rewinding, scene selection, no degradation, etc etc). Going from DVD to HD-DVDs (whether HD DVD or Blu-ray) won't be an easy sell.

I see these going the way of Laserdisc - a niche market.

DVDs will be like CDs - there are other higher quality options out there (SACD, etc), but people can't tell or don't care enough about the difference that they're sticking with their tried & true format.

Then with the problem of having two competing formats, that just is the nail in the coffin. Of course, then the NICHE market that *IS* buying HD discs, will split between the two.

 

[Nils Luehrmann]

I can only assume you did not buy the first round of DVD players back in '97. They did not plummet for quite some time and the initial players were listed at or above the pre-release estimated costs.

Manufacturers are not in the habit of publicly announcing estimated MSRPs significantly higher than the eventual listing price as these announcements are intended to generate interest, not turn people off by inflated pricing. There are a few exceptions to this general practice, but usually the final price is at or even above early manufacturer’s estimates.

I'm sorry if you still do not see exactly how this format war has benefited the end-user, and that without it we would all be looking at products priced at least twice than what is now being estimated and with specs that would not match what has been developed so far.

As for those that say a format war causes confusion in the marketplace... These are not exactly J6P products so "confusion" over the format is not really an issue at this point. The majority of consumers that are part of the initial target market are well informed and have been following the development of both formats for at least the last few months. Both of these formats together will sell only to a very select few customers for the first few years, and may never catch up to SD-DVD sales before they are replaced by much higher capacity discs with transfer speeds several times faster than either format – like HVD.

Most of what Jay said above I agree with, and I've said it several times before, blue laser optical discs as devices for playback of pre-recorded material (films) will likely never reach the level of popularity of standard DVDs, and for at least the next several years will only account for less than 10% of the market. However, I believe at least Blu-ray (for the pedantics) will have much better success in the PC and recorder market due to its higher capacity. Eventually though, products like HVD will dominate the high capacity market and will offer a substantial jump in performance that would likely meet or exceed the demands of future ultra-hi resolution products.

 

[Edwin-S]

Personally, I don't think that failure of SACD and DVD-A is strictly due to a format war. Part of the failure is due to poor promotion of the technology and lack of access to affordable software. The main reason for the failure of SACD and DVD-A is the MP3 player and music downloads. MP3 amply demonstrates that people will accept lower rez music as long as they can easily download and store hundreds of songs on one small machine. Quantity, not quality, is driving the music biz now. SACD and DVD-A with their emphasis on quality are left out in the cold. Both SACD and DVD-A would zoom if people could download hundreds of SACD or DVD-A quality songs on to a tiny player.

IMO, people who pay 99 cents a tune to download music are being treated like suckers by the music industry.

 

[AaronMK]

Forget the fact that only 10% of households having HDTVs makes HD DVD and Blu-ray a niche market. Apparantly, 2/3 of those owners think they are watching HD when they really aren't. (towards middle of this article).

I guess that indicates one of two things: You aren't going to convince them that they need some HD format, since their TV magically makes everything HD anyway, making even more of a niche market. Or they will buy which ever HD player is cheaper since the player will magically turn their SD DVDs into HD.

Makes you laugh (or cry) to think that many of the people buying these players might not even know there is a format war. So much for J6P confussion not being an issue, it could make a bunch of coin-toss purchases determine the winner of the format war.

 

[Edwin-S]

An interesting part of the article is the number of HD sets being sold is rapidly increasing. 3.7 million sets were sold in 2003. They are estimating that number to increase to 14.9 million by 2005.

There are several HD channels available over my satellite service; however, I'm not subscribed because the HD receivers are still too damn expensive. I'm not willing to pay $800 dollars for an HD capable receiver just to watch shit like "SURVIVOR".

I have been curious about some of the Hi-Def material on PBS though.

People are confused because the salespeople are dong a poor job of explaining the ins and outs of the television that is being purchased. They just want to sell the sets, so they are not telling the buyers that HD service may not be available. People are buying the sets based on the images being fed to the sets by the store. A lot of those store images are HD content. People are impressed with the in-store picture quality. That may actually help the sale of HD disc players. People may decide to buy a player when the players start showing up in stores and people start seeing the image quality the players are capable of displaying

High Definition disc players may turn out to be less of a niche product than we think.

 

[Jeff Adkins]

If you add up Sony, MGM, and Disney's current percentage of DVDs sold in the last 12 months, it's far less than the percentage of DVDs being sold by Universal/Paramount/New Line/Warner/HBO. I can't think of any other way of gauging this that would be more accurate than percentage of overall DVDs sold by studio. I wish you were correct since I think Blu-Ray is superior.

I'm really upset because I want the Kubrick films more than anything on HD and the cream of the crop all belong to Warner. I suppose if the Kubrick films became available on HD DVD (not unlikely considering Warner announced during the chat that new Kubrick SEs will be out in 2006), I might actually have to break down and get an HD DVD player just for those few films which I love.