BluRay's Biggest Issue (imho): High Movie Prices

Re: BluRay's Biggest Issue (imho): High Movie Prices

Yes, but the deals have been rather frequent and have allowed me to average a much lower per disc price than HD DVDs. The reality is, I don't see too much of a difference in price between the two in store for new release movies, with some of the HD DVD releases actually being higher. For all the comments they've made about HD DVD being easier and less costly to produce, that hasn't seemed to translate into significantly lower prices for the consumer...

Reliable, fast downloads are at least 5 or more years away IMHO, though I do think that is the eventual way of the future. There are still significant roadblocks to this, not the least of which is the consumer who will generally want something in their hand for that hard earned cash. Unless downloads are also significantly less expensive, they won't catch on either.

Re: BluRay's Biggest Issue (imho): High Movie Prices

I have plenty of BD's where I've paid less than $15, which has always been my limit for new DVD releases.

I see 2 competitors to BD (and neither one is HD DVD ):

a) "HD" downloads. HD Lite, IOW. Called HD, but it's downres'ed. Not 5 years away. In some cases, it's already here.

b) DVD. For right or wrong, I just don't think the average person is going to be willing to pay what it really takes to take advantage of BD's better audio and video. Some of that goes back to cost, but a lot of it is the receiver (pre/pro), the player, dealing with firmware upgrade hassles, HDMI handshake issues, DTS-HD MA, etc.

Re: BluRay's Biggest Issue (imho): High Movie Prices

I disagree. The biggest problem with Blu-ray is the price of the players.

Re: BluRay's Biggest Issue (imho): High Movie Prices

Or the total lack of software.. (my next disc purchase is scheduled for March)

Re: BluRay's Biggest Issue (imho): High Movie Prices

How many people can take advantage of that at present? I've got broadband, but downloads of that size bring back memories of large downloads via 14400 modem.

Re: BluRay's Biggest Issue (imho): High Movie Prices

I have never bought a BD disc for more than $15 (well, only the 5 disc Blade Runner ). There are plenty of BOGO (buy one get one) free sales. It seems like Frys, BB, or Amazon have these every other week. In fact:

New Amazon Sale on Warner Blu-ray, HD DVD Titles | High-Def Digest

Players: I got my Sharp for $300 ... almost 2 months ago. The sales are out there if you look for them.

I say, cost in general is an excuse, not a reason. BD is *still* a new format. The costs *will* be higher early on simply because the studios and hardware manufacturers have to recoup development costs. But if you'vre been watching, the costs have been dropping as well.

I saw some new this week release where Frys had the DVD for $16, and the BD disc for $20. That's rare, but it's another positive sign. The difference between DVD and BD is decreasing over time as well.

Re: BluRay's Biggest Issue (imho): High Movie Prices

I agree the prices are too high for most consumers (especially since the country is staring down the barrel of a possible recession). I already own a HD-DVD player and about 30 titles, but I am apprehensive about sinking any money into a BluRay player until they get their stuff together. However, if higher prices on hardware and software cause BD and HD-DVD to creep into the niche market in which LD flourished, this could be a good thing. There will be less chance of HD being dumbed down for J6P.

Re: BluRay's Biggest Issue (imho): High Movie Prices

How long did it take SD-DVD to drop to the $15 price range?

I don't think $399 (PS3) is too much at all, in fact I bet you can still find SD-DVD players for more.

Re: BluRay's Biggest Issue (imho): High Movie Prices

Hell, i cant find many DVDs i would want until March, much less Blu-ray. Most of what i have on my Amazon wish list is TV shows. And i only have 6 or 7 items at that...for the next 3 months!

Re: BluRay's Biggest Issue (imho): High Movie Prices

Same here. GATACCA on Blu-ray should be SWEET. :-D

Re: BluRay's Biggest Issue (imho): High Movie Prices

I think we're a bit spoiled about prices (myself included). I have two SD DVD players in my HT. One cost me 800$ (I use it only for hi-res audio) and the other 450$. And this was in 2003--not the pricey 1st generation models. Prior to that, I had another player, bought in 2001, that cost me 700$ (it was subsequently stolen and replaced, inadequately features-wise, by my insurance company so I gave it to my brother in law). If we factor in inflation, in today's dollars you need to add 10%.

My HD DVD player, on the other hand, cost me 170$. If I factor in some 2 for 1 sales, Christmas gifts and the five freebies, my average disc cost (of about 30) has been about 15$. Even in 2003, a 15$ SD DVD was the exception, not the rule.

I'm all for lower prices but I also think we have to have realistic expectations. And, frankly, I think the downward price pressure will decrease, not increase, with the "end of the format war" (I'm not convinced it will end as quickly as some think--inertia is a powerful force).

Re: BluRay's Biggest Issue (imho): High Movie Prices

I don't think that's a fair comparison. In the early days of DVD, VHS was not available as a new release sale but went for rental first. Consumers were not used to being able to own a movie when it came out to the home market.

So a $25+ DVD had a different value back then, because it was the only way to own a new movie at the time.

Re: BluRay's Biggest Issue (imho): High Movie Prices

I'm a veteran of the hi-res audio "war" (now truce as I have a universal player) and I know that price can inhibit adoption. My concern about expectations of "cheap" HDM is that studios will cut corners--few high quality extras, less careful transfers (this could be especially counterproductive)--in an effort to meet such price points. I think price will come down as a function of volume and I think for that to happen, price reductions have to come from the player side as well. But, frankly, I've given up trying to guess who will be the "winner". I have two MiniDisc players, two DVD-A players (one of them also plays SACD), an HD DVD player, a Mac laptop, a PC laptop, SD TVs, an HD front PJ, a cassette deck, an S-VHS deck, etc. If I can afford it and it gives me what I want, I buy it. But then again, I don't mind the clutter in my HT room (can't see it with the lights out anyway)--that's not the case for everyone. But I'll happily pick up a Blu-ray player (at this point, it seems likely to be a PS3) sometime in the next few months to add to the collection. I'm even looking to add a turntable and haul out my old vinyl. Guess all I need is a reel to reel and a laserdisc player to complete the setup (I'll skip the DCC, at least).

Re: BluRay's Biggest Issue (imho): High Movie Prices

Lee,
Educate me. Why would the studios try so hard to entice people away from DVD. For them (studios) isn't it just like taking money from their left pocket and putting it in their right pocket?

Re: BluRay's Biggest Issue (imho): High Movie Prices

That's one possibility. I think that they may also be looking at having BD as a premium product; they can sell DVDs for $20 and BDs for $30.

Re: BluRay's Biggest Issue (imho): High Movie Prices

Maybe 10 years from now but currently you and I both know that they make a ton more bucks on standard DVD sales.

Re: BluRay's Biggest Issue (imho): High Movie Prices

There are probably various factors involved. Some include:

1. The segment of the market that is more willing to pay the price premium are precisely the ones that would go for HDM over DVD. The same thing was and is true w/ DVD even now, eg. consider who'd pay $40-50 for a Criterion DVD release for instance. Sticking w/ just DVD means they are not maximizing the potential of their film libraries, especially considering the current state of the DVD market where margins are no longer nearly as good as they used to be. And really, they can only get people to double-dip so many times w/in the same format.

2. A transition was bound to happen at some point if the studios and CE companies want to continue to sustain revenues and profits w/out some sort of industry-wide recession that can happen if they miss the boat on when the transition should ideally occur. They can't merely sit on their laurels indefinitely afterall. Consumer products have natural life cycles, and DVD would eventually run its course though you can obviously debate when exactly is that point. Saying "maybe 10 years from now" is basically saying "we don't know when we should switch and we'll just do nothing but pray and hope we're lucky and don't miss the boat" -- and honestly, 10 years is almost certainly too far off though I'd agree if you mean HDM in 10 years might be more or less like DVD now (or a couple years ago), but if that's the case, then you wouldn't be the market driver and would only be riding along on somebody else's coattails, if those coattails even exist at that point.

3. Economies of scale issue. Since they are already commiting to HDM, there's a need to work towards a point where HDM production costs become comparable to current DVD production costs since their bottomline is profits *not* merely "empty" revenues, ie. very low margins. For instance, if all they can expect is $5 bargain pricing w/ DVD, then where are the profits for them regardless of how high the revenues seem to be? But to achieve strong profits from the price premiums of HDM, they need to drive production costs down towards where DVD already is. Otherwise, their margins might not be high enough to make the entire effort worthwhile.

There's a little bit of a catch-22 (or rather a complex balancing act) going on there as you might notice. But actually, it's probably all just the normal life cycle of such products and the business although I suspect the studios and CE companies probably should've spent a couple more years ironing out most of the HDM details and infrastructure before throwing us into a format war at a point in time when the market was not quite yet ripe for HDM anyway. I think the format war and the bad timing have combined to cost them a good deal of $$$ in the DVD market and in turn the $$$ that got spent paying off studios. I guess ultimately the CE leaders of both sides end up paying the costs of the premature push. If they had done it right, I believe an actual format war in the marketplace should've been avoided (at least for their goals, if not necessarily for ours as consumers). But oh well...

_Man_

Re: BluRay's Biggest Issue (imho): High Movie Prices

Man,
I don't think this so-called format war has cost the studios anything. In fact, some studios Paramount and Warners for example probably made more money in "payoffs" than in HD disc sales. Who knows what the other studios may have received. Boy...are they smart!!! They just sit back and observe....their 2 jumps ahead of anyone else. They can sense which direction the wind is blowing before anyone else and the wind is whispering.....downloads.

Not so smart are the CE manufacturers. HD-DVD and Blu-ray remind of 2 bidders on Ebay that OVERBID on the studios product. Good!!! They have only themselves to blame.

Re: BluRay's Biggest Issue (imho): High Movie Prices

That must be a wind from quite a long ways in the future.

Re: BluRay's Biggest Issue (imho): High Movie Prices

Hard to know what exactly the studios make or lose out of the war. Yes, we've all heard about the payoffs -- and they were not limited to Paramount and Warner -- *BUT* how exactly are these payoffs structured though? For all we know, the payoffs may not actually cost Sony, Toshiba, et al as much as most folks seem to think. It really depends.

Meanwhile, a format war can directly and/or indirectly cost the studios some years of reduced overall revenues (and profits) due to so called "format confusion", which is probably made up of more than just the one kind of "confusion" that folks tend to talk about. Why do you really think DVD revenues had plateued for a few years and now started coming down recently (and nevermind whether profits have actually been quite *THAT* great of late)? Without being a deep insider, it's probably impossible to know how everything actually fits together for the big picture, if it's even possible at all. But it's easy enough to observe that none of these various factors (among others) operate in a vacuum so that you can pinpoint and say "Aha! That's the culprit!" all by its lonesome.

Still, yes, I agree that things have played out in such a way that the studios have ended up not losing much, if anything, and I pointed that out at the end of my previous post. And depending on how the payoffs are done, they might indeed have benefited from the war. But again, we don't really have the facts to know that. Even all the folks w/ inside sources have not actually said such things like "Sony actually made one 500M (or whatever) lumpsum payment to Warner to be BD exclusive w/ no strings attached (other than being BD exclusive)".

Consider this. When someone wins the lottery for a 10M prize (or whatever), do they really get all 10M in one lumpsum payment to keep w/ no strings attached? If even something as seemingly plain and simple as winning the lottery isn't quite so simple, why think these payoffs between giant corporate entities are so simple either? The folks running Sony and Toshiba are not exactly idiots afterall.


That may well be so wrt downloads. But I think the studios (like most anyone in business to make $$$) will want to hedge their bets, etc. as things play out. If the studios have their way, they'd make tons of $$$ off every conceivable medium/vehicle the CE companies can come up w/. If something ultimately fails, they'll just move on to something else.


Well, it's tough being hardware makers where the hardware can be commoditized by the software side of the equation. That's true in other industries too.

But in this way, Sony's probably pretty smart actually. They're *both* hardware and software afterall -- and they're so big that they're not just limited to one segment of CE either nor are they limited to being consumer product producers either. For instance, they make big $$$ in the camera/photography world as a supplier of parts like LCD displays, CCD (and CMOS) sensors, etc. And they probably hold plenty of patents, etc. and make good $$$ on royalties and such. And coming back to BD, they've even managed to work it out so that it's co-leveraged w/ their gaming business via the PS3 -- and apparently, the PS3 is finally starting to make $$$ for them. You did notice some of the hate posts for Sony and the PS3 that's not strictly HDM related, right?

Toshiba, OTOH, is the one that's clearly more disadvantaged in this format war though they're not exactly small potatoes either of course. Still, depending on how much they actually make in DVD royalties, it could really hurt them to lose the format war in a way that might not for Sony.

_Man_