There has been lots of debate about the future of optical disc, particularly Blu-ray. The talk has all been around streaming digital taking the place of optical media.
At the recent sixth annual TV of Tomorrow Show Anthony Wood, inventor of the DVR and CEO of Roku was quoted stating
Will people use Blu-ray players in four years? I don't thing so
An interesting tidbit published by NPD was that nearly 80% of users how connect their Blu-ray disc player to the Internet to access online content are downloading TV shows and movies via Hulu, Netflix, and other subscription VOD services, compared to 69% of connected TV users and 64% of connected video game console users. Isn't it amazing that of all the devices in the home, the Blu-ray player has the most digital distribution/streaming?!
However, at the recent Media Tech Europe conference in May Jim Bottoms from Futuresource said that there are
Reasons to be cheerful
as he cited that European Blu-ray video capacity production grew by 40% last year and that 2011 was the best year for BD replication investment since 2007.
However, Tony Gunnarsson of IHS Screen Digest. had cautionary note stating
Consumer spending on physical media peaked at $55 billion in 2004. The spending on physical video has been in decline ever since, and this decline accelerated after 2007.
In contrast to Anthony Woods statement around digital streaming, digital delivery/streaming is still evolving and currently is only 5% of the overall video market. In regards to Blu-ray specifically Tony states
BD transactions have grown very strongly since its launch and it is one of the fastest growing areas in film consumption
Now Tony didn't provide some interesting facts that would make those quotes relevant and those would be comparisons of how DVD adoption occurred in the same time frame that Blu-ray had.
IHS Screen Digest reported in March forecasts this year, for the first time ever, consumer will watch more movies online than on DVD's and Blu-ray discs! The report predicts that digital delivery/streaming services will account for 57% of all movie consumption, but only 12% of spending. The amount of titles available for digital distribution/streaming are forecasted to grow 135% to 3.4 billion titles. Compare this to a recent report from DEG that stated physical sell through of Blu-ray disc movies was up a whopping 2% for the first quarter of 2012. Catalog sales of BD were up 27% and TV BD sales were up 54%. The DEG estimates that 2.4 million players were sold in the first quarter, which includes BD players, PS3's and HTiB's. They don't break out the percentage of PS3's in that number, which was always a point of contention in the format war because not everyone that buys a PS3 is buying it to watch BD's...
Russ Crupnick, Senior VP at NPD Group, recently stated
Over the next three to five years, we'll all be doing stuff in the cloud, but Blu-ray is not going anywhere. I think Blu-ray and digiatl delivery are going to peacefully co-exist.
When I was heavily involved in the format war, one of the "threats" that both camps had was how to get people to upgrade from DVD. At that time one big hurdle was most consumers didn't have a HDTV to even see the difference in picture quality, but we were confident that it would pass. The next big concern was would consumers be interested enough to upgrade from DVD like the conversion was from VHS to DVD.
We all knew that going from VHS to DVD provide many more features than just better video quality. They were key features like no need to rewind, skipping to chapters instantly and the medium not wearing out after repeated use. DVD to Blu-ray didn't offer those benefits. Thus Blu-ray, to many consumers, is a premium product to DVD, not a replacement to DVD.
NPD currently tracks ownership of Blu-ray players at approximately 20% of US households, but the format is not expected to ever reach the 80% ownership rate enjoyed by standard DVD players in the US home.
I still consider digital distribution/streaming to be the biggest threat to Blu-ray. When Apple came out with the iPod, no one could imagine that it would knock CD out of the market in the years to follow, even though the audio quality was, at the time, substantially less than CD. However, convenience and portability trumped audio quality.
Unless UV takes off in a big way with the promise of portability and digital storage in a central place with the same audio/video quality as a Blu-ray disc, I don't know if I disagree with Anthony Wood. I don't know if it will be in a 4 year time frame, but I think it is inevitable.
Crupnick of NPD seems to support my philosophy on this by stating:
If people get into the idea of UV, we could still be talking about physical media years from now
Personally, I don't use streaming media. Even with the convenience factor, I would rather go to RedBox and rent a Blu-ray or wait and purchase the Blu-ray at a good price.
I know this flies in the face of all the members of HTF, including myself, but we are a minority of the larger consumer audience. Personally, I want the audio and video quality of what we get on blu-ray in a moveable and portable format. I want to replicate Kaleidescape's experience, but with a DIY solution or at least a reasonably priced solution that ALL the studios support.
What do you think?