Universal, new albums will be hybrid SACD (1 Viewer)

[Greg Br]

Not sure if this was posted before but the ramifications are huge, this article also makes it sound like as soon as Sony has the plants that they will go this direction as well.
http://www.stereophile.com/shownews.cgi?1353
I thought the law was that all cd's had to be backwards compatible to the initial cd players, and that with hybrid SACD's this is not possible.

 

[John Kotches]

Greg,
I believe there's a lot of misinterpration with this.
The way everyone wants to read this, is that all upcoming titles will be SACD/CD hybrid.
What it really means is that SACD releases for Universal might all be hybrids.
The pressing capacity has to number into the billions before Sony and Universal could think of transferring over to hybrids for all their inventory.
Regards,

 

[Greg Br]

If one company starts then that would be a step in the right direction would it not.

How about the Warner pricing of new didcs for dvd-a, that seems the biggest news of the week, I mean new cds and dvd-a the same price around 13.99

 

[KeithH]

Greg said:

I thought the law was that all cd's had to be backwards compatible to the initial cd players, and that with hybrid SACD's this is not possible.

Why would hybrid SACD not be compatible with older CD players? I have never heard that before. I suppose if there is a compatibility problem, then the record labels should remove the Compact Disc logo. Still, I don't think this is an issue.

NP: The Who The Ultimate Collection CD, disc 1 ("Pictures of Lily")

 

[John Kotches]

Greg,
It's a matter of pressing plant capacity, mixing station capacity, etc, etc, etc.
A huge undertaking financially, and in terms of equipment required in the field.
So, it ain't happenin' in the near future.
Now, this doesn't mean that Universal isn't going to release all SACDs as hybrid media. It means they won't be switching over exclusively to hybrid SACD.
Regards,

 

[John Kotches]

Speaking of the labeling issue, I was checking out the consumer "state of the art" last night..... (Ok, I went into Best Buy to pick up a DVD).
As is my habit I checked out the DVD-A and SACD sections.
Oddly enough, the Toto IV multi-channel disc, which is SACD only (not hybrid) and it had on the bottom right hand corner of the front cover a Compact Disc Digital Audio logo. Weird that they would leave that logo on the cover art, and list elsewhere on the disc that it will play in SACD only units. Weird.
Regards,

 

[Lee Scoggins]

So, it ain't happenin' in the near future.

John,

You don't know this for a fact. This is just speculation. It could happen.

Greg,

I reported on this a couple of weeks ago. There is some confusion at Stereophile about whether the story's sources were telling the truth. I have not been able to get to the bottom of this, but no big announcements have been made by Sony as of yet.

 

[John Kotches]

Lee,

Announced pressing plant capacity which will be online at year's end 2002 is approximately 80million discs annually.

While that's a lot of discs, it isn't a dent in the output of Universal or Sony.

Where will the other billion or two discs come from?

Regards,

 

[Greg Br]

John,

You would now better than me but how hard would it be to aquire the equitment to produce these discs. For a company like Sony I think they could start putting everything in place relatively quickly. I know companys like Intel change a plants product production in a matter of months, and this is semi conductors compared to cd's(not exactly rocket science).

 

[Lee Scoggins]

John,
Although they would have to ramp up production quickly, all the JVC and other pressing plants would need to have is a big company or two (Sony and/or Philips) on board with a commitment. In talking with some friends who work in this area, the financial commitment may not be that substantial since the extra equipment can be added to the line. They were not sure what a realistic timeline would be, but I suspect by the end of the year, things would be rolling along.

 

[John Kotches]

Lee,

I quoted a very precise figure that has been stated publically by officials from Sony as available capacity by year's end (presented as titles per day -- which has been multiplied out to arrive at my total). You replied with paraphrased Sony/Philips could if they wanted to

Every DVD pressing plant in the world has the ability to press DVD-A discs, with no changes to production facilities. This is not the case for SACD hybrid discs.

Since existing pressing plants are already churning out every DVD title they can, why would a company want to shut down for the time it takes to retrofit all the special requirements for SACD? Will Sony and/or Philips foot the bill for lost production during that period as well? What other incentives are out there for the plant to make such a change? That's a pretty hefty bill to be footing in a period where the economy isn't rosy worldwide.

As a business strategy consultant and given the the current economic climate do you think this would be a wise investment? The future of SACD and DVD-A are from certain to be a success in the mass market.

Regards,

 

[John Kotches]

Greg,

It is neither cheap nor trivial for Intel to do. If memory serves me correctly, the last chip fab that my employer built was in East Fishkill at the tune of US$2.5 billion. The cost to upgrade our Burlington VT site is approximately the same.

During a conversion, there is no usable output, and the work is usually done on a line where the technology is the oldest....


Regards,

 

[Lee Scoggins]

As a business strategy consultant and given the the current economic climate do you think this would be a wise investment?

This is a complex question to answer because we are lacking data, but one could clearly see a multitude of scenarios whereby economic sense could be made. The Harvard Business School has studied many firms on where corporate venture capital is successful and Super Audio has several characteristics such as product line and brand extension. They have also made a significant advance as far as pro audio is concerned and could derive substantial profits there. To really judge this we would want to know such factors as (to name but a few):
1. Cost of Super Audio retrofit on wholesale and retail basis
2. Influence of Sony/Philips over the many independent pressing plants that exist
3. Total projected forward calendar volume of new titles and participating labels for "only hybrid" strategy
4. Competitive position of Warner and possible results of its recent price drop strategy on DVDA
5. Cash and Balance Sheet position of Sony Super Audio business unit (ie. ability and desire to withstand long-term strategy)
Sony and Philips may view this as a very long-term investment. In general Japanese firms often take a long view (good) but have poor management teams and are too family oriented for their own good (bad-not enough creative destruction).
My original point is that Sony can apply significant pressure for SACD line conversions and quickly get the market up to speed for a large number of titles. Is this the best time to do that, I don't know. On one hand, the economy is terrible and one would normally conserve cash. On the other hand, this is a critical time for the two formats and big "battle" win here might possibly win the war. It all depends on how cohesive the Sony/Philips team is and how strong their strategy could be.
I am betting that Sony/Philips have a significant dollar investment and will fight hard until a clear winner (if there is one) emerges. Super Audio may flourish fine as a preferred pro format and niche audiophile product.

 

[Lee Scoggins]

John,
By the way, did you ever receive my McCoy Tyner: New York Reunion album from Chesky Records?
What did you think?

 

[John Kotches]

Lee,

Thought I replied to this earlier today, but my computer says otherwise.

My usual source backordered me, and I just cancelled that and placed it with another source.

Thanks for the reminder.

Regards,