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HD moves cost so much more than regular DVD because?


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#1 of 9 BrianGC

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Posted January 06 2008 - 11:29 AM

Is there any reason related to the manufacturing process why HD movies cost so much more than regular DVD?

BGC

#2 of 9 Joseph DeMartino

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Posted January 06 2008 - 01:51 PM

It depends on what you mean by "the manufacturing process". Does it cost a whole lot more to replicate HD-DVDs than regular DVDs? No. One of the selling points of HD-DVD was that it could be produced on the same production lines used for regular DVD. (Blu Ray discs do require special production facilities, so that may add a bit to production costs. In both cases the blank media are somewhat more expensive.)

But replication is only a small part of the story. It takes longer and costs more to produce hi-def masters for the film plus the extras. Finally the market for hi-def discs is a fraction of that for DVD, so the costs must be recouped on much lower sales. You might easily sell 500,000 copies of a feature film on DVD, but be lucky to sell 50,000 copies of the same film on HD-DVD or Blu Ray.

DVDs were more expensive than VHS tapes when the format was new for much the same reason. (Laser discs were much more expensive than VHS tapes and remained so until the format died because LD never became a mass-market item.)

Besides, is around $5 extra really "so much more"?

Regards,

Joe

#3 of 9 Jimi C

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Posted January 06 2008 - 01:56 PM

"Besides, is around $5 extra really "so much more"? "

Yes.
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#4 of 9 Joseph DeMartino

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Posted January 06 2008 - 02:16 PM

Quote:
Originally Posted by Jimi C
"Besides, is around $5 extra really "so much more"? "

Yes.

Well, then hi-def DVD may not be for you, at least not yet. All new technologies cost more when they're introduced, until the market expands and economies of scale kick in. DVD used to have that same $5 premium. CDs cost a lot more than $5 more than LPs when they were introduced. LDs cost $30 or $40, typically, $70 to $150 for a special edition with fewer extras than the average DVD SE. (And let's not even talk about players. The first CD and DVD players each went for a grand.)

VHS tapes sold for $80 or $100 when they were exclusively sold to video stores for rental. George Lucas created the rental market for VHS by lowering the sale price of Raiders of the Lost Ark to a mere $40. By historical standards hi-def DVD media are actually quite cheap for a product this early in its life cycle.

Regards,

Joe

#5 of 9 BrianGC

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Posted January 09 2008 - 05:36 AM

I thought the difference was usually more than $5. Recent news stories seem to show what the choice will be in the future. I've got time to wait until the prices even out, unless my standard def. TV blows up. LOL

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#6 of 9 Joseph DeMartino

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Posted January 09 2008 - 05:57 AM

Quote:
I thought the difference was usually more than $5.

Well, I have an HDTV, but no hi-def disc players, so I just spot checked some titles on Deep Discount and Amazon.com to get a feel for pricing, and $5 seemed to be about the average, with Blu Ray sometimes coming in a bit higher. (And sometimes not, if a sale was on.) List prices seem to be substantially higher for hi-def than for standard, but the gap narrows when you look at actual street prices.

Regards,

Joe
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#7 of 9 Zack Gibbs

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Posted January 09 2008 - 06:02 AM

All the people who complain about HD not being priced the same as SD, do realize you're getting a better product right? No one seems to be fond of the idea that may the discs are *worth* more. I guess it's not like that's one of the basic principles of economy or anything...
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#8 of 9 Joseph DeMartino

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Posted January 09 2008 - 06:46 AM

Quote:
No one seems to be fond of the idea that may the discs are *worth* more.

The most basic principle of economics is that a thing is worth what someone else is willing to pay for it. You can't always charge more for something simply because it is "better" by some measure. It has to be enough better for your target audience to pony up extra to buy it.

With early-adopters and enthusiasts the present price point seems to work, both for discs and players. As the industry tries to broaden the market, prices for both players and media will have to come down. There are lots of people with HDTVs for whom $300 is way too much to pay for a DVD player. When the players drop to $200 on average they will sell a lot more of them. When they hit $100 they'll sell a lot more.

VHS, CD and DVD all went through exactly the same process. LD did not. Player and disc prices came down very slowly, until DVD came along and both went at liquidation prices. This was largely because LD, a pricey, playback-only system that used cumbersome media, could not complete with VHS and Beta, which could both play and record.

By the time DVD came along, CD had accustomed people to 5.25" digital media, everybody already had a VCR or DVR, and big screen TVs created a market for a high-quality playback medium that could escape the niche LD remained trapped in. Hi-def media will also go mainstream at some point, but its growth potential is limited by the installed base of HDTVs, which remain a distinct minority in American homes.

Regards,

Joe

#9 of 9 Tony-B

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Posted January 09 2008 - 07:33 AM

My guess is that the consumer demand isn't completely there for HD movies on disc quite yet.
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