Posted on 10/29/2008 11:02:59 AM PDT by savedbygrace
Blu-ray is in a death spiral. 12 months from now Blu-ray will be a videophile niche, not a mass market product.
With only a 4% share of US movie disc sales and HD download capability arriving, the Blu-ray disc Association (BDA) is still smoking dope. Even $150 Blu-ray players won’t save it.
16 months ago I called the HD war for Blu-ray. My bad. Who dreamed they could both lose?
Snatching defeat from the jaws of victory Delusional Sony exec Rick Clancy needs to put the crack pipe down and really look at the market dynamics.
In a nutshell: consumers drive the market and they don’t care about Blu-ray’s theoretical advantages. Especially during a world-wide recession.
Remember Betamax? SACD? Minidisk? Laser Disk? DVD-Audio? There are more losers than winners in consumer storage formats.
It’s all about volume. 8 months after Toshiba threw in the towel, Blu-ray still doesn’t have it.
The Blu-ray Disc Association doesn’t get it
$150 Blu-ray disc players are a good start, but it won’t take Blu-ray over the finish line. The BDA is stuck in the past with a flawed five-year-old strategy.
The original game plan
Two things killed the original strategy. First the fight with HD DVD stalled the industry for two years. Initial enthusiasm for high definition video on disk was squandered.
Second, the advent of low cost up-sampling DVD players dramatically cut the video quality advantage of Blu-ray DVDs. Suddenly, for $100, your average consumer can put good video on their HDTV using standard DVDs. When Blu-ray got started no one dreamed this would happen.
Piggies at the trough
The Blu-ray Disc Association hoped for a massive cash bonanza as millions of consumers discovered that standard DVDs looked awful on HDTV. To cash in they loaded Blu-ray licenses with costly fees. Blu-ray doesn’t just suck for consumers: small producers can’t afford it either.
According to Digital Content Producer Blu-ray doesn’t cut it for business:
* Recordable discs don’t play reliably across the range of Blu-ray players - so you can’t do low-volume runs yourself.
* Service bureau reproduction runs $20 per single layer disc in quantities of 300 or less.
* Hollywood style printed/replicated Blu-ray discs are considerably cheaper once you reach the thousand unit quantity: just $3.50 per disc.
* High-quality authoring programs like Sony Blu-print or Sonic Solutions Scenarist cost $40,000.
* The Advanced Access Content System - the already hacked DRM - has a one-time fee of $3000 plus a per project cost of almost $1600 plus $.04 per disk. And who defines “project?”
* Then the Blu-ray disc Association charges another $3000 annually to use their very exclusive - on 4% of all video disks! - logo.
That’s why you don’t see quirky indie flicks on Blu-ray. Small producers can’t afford it - even though they shoot in HDV and HD.
The Storage Bits take
Don’t expect Steve Jobs to budge from his “bag of hurt” understatement. Or Final Cut Studio support for Blu-ray. I suspect that Jobs is using his Hollywood clout from his board seat on Disney and his control of iTunes to try to talk sense to the BDA.
But the BDA won’t budge. They, like so much of Hollywood, are stuck in the past.
A forward looking strategy would include:
* Recognition that consumers don’t need Blu-ray. It is a nice-to-have and must be priced accordingly.
* Accept the money spent on Blu-ray is gone and will never earn back the investment. Then you can begin thinking clearly about how to maximize Blu-ray penetration.
* The average consumer will probably pay $50 more for a Blu-ray player that is competitive with the average up-sampling DVD player. Most of the current Blu-ray players are junk: slow, feature-poor and way over-priced.
* Disk price margins can’t be higher than DVDs and probably should be less. The question the studios need to ask is: “do we want to be selling disks in 5 years?” No? Then keep it up. Turn distribution over to your very good friends at Comcast, Apple and Time Warner. You’ll be like Procter & Gamble paying Safeway to stock your products.
* Fire all the market research firms telling you how great it is going to be. They are playing you. Your #1 goal: market share. High volume is your only chance to earn your way out of this mess and keep some control of your distribution.
Time is short. Timid incrementalism will kill you.
Like Agent Smith delivering the bad news to a complacent cop: “No, Lieutenant, your men are already dead.”
1) The premise that Blu-Ray offers no advantage over upscaled DVD is total garbage. That might be true on a 32” TV, but buy yourself a 1080p home cinema projector (90”+image, baby!) and a copy of Blade Runner and then you can see what the format can do. There is simply no comparison. Image quality can exceed your local multiplex.
2) Agree that Blu-Ray discs are too expensive, studios are trying to milk things as they always do with new formats. But then, I only rent movies these days, the only discs I buy are TV series.
You can buy a terabyte of HDD storage for backup at a little more than $100 nowadays, store full DVDs for less than a buck apiece.
DVDs store a small amount of information compared to Blu-Rays.
I got three disks with Iron Man. That would take up the majority of the backup AND I don’t have the ability to use BD Live.
I suspect that over the next couple of years, the number of folks who are going to want to put $3000+ on their credit cards for a TV set will be greatly diminished, and the Blu Ray consortium would do well to keep that in mind.
Re: Price.
I got Speed Racer (for my daughters) and Forbidden Kingdom (for me, Love Jackie Chan) for 42.00 on Amazon. Free shipping.
Check out this Amazon link
http://www.amazon.com/s/ref=nb_ss_gw_1_8?url=search-alias%3Ddvd&field-keywords=iron+man+blu+ray&sprefix=Iron+man
Iron Man Blu-ray is 25.95
DVD is 22.99
Not too much of a difference there.
No pipe dream (clever phrasing, however!). Broadband providers will find a way to deliver you movies for less than the cost of a physical CD, even if they have to charge for it. Mostly likely, they’ll find a way to charge iTunes and other music sources for delivering a movie to the end user.
More than that.
I have an upscaling DVD player in the living room, a regular DVD player in our bedroom and one downstairs in the rec room. I also have a portable DVD player, as does our eldest rug rat. Then we have a DVD player in the back seat of the van.
If I have a choice between buying a $35 disc I can only watch in one room of my house, versus a $15 disc I can watch in six different places, plus my PC, plus rip it to my Palm TX, it will be, and has been, an easy decision.
In addition, the millennial generation believes in bits, not atoms.
True, but compare to rental cost - here in the UK about $2 to $4 depending on how many movies I can watch in a month.
I won’t make the mistake I made back in the eighties with the beta vs. vhs videotape fiasco. Naturally I went with beta, and we know how that turned out. This time I’ll wait until one or the other has definitely emerged victorious. Then I’ll wait some more.
absolutely. same could be said for cd and dvd vs tape and vhs respectively. the primary question for bd is the value of the improvement in picture and sound to the consumer. prices will come down on bd material once more players are out... chicken and egg problem for sony though. studios are happy selling dvds. studios like bd as opposed to pc-based solutions though because they feel they have more control over it... if they gain enough comfort with downloaded HD content (at BD bitrates), bd might just be doomed. As it is, just because you upscale a standard def picture to 720p, compress the hell out of it, and offer over the internet, does not mean it is comparable to bd for everyone (thought it is for those with small displays). things still need to shake out more. I bought a combo bd/hd-dvd player with a nice scaling chip open box on clearance for what the better scaling dvd players run. I certainly would not have paid the full cost for the player given the uncertainty, and I only buy the discs at a reasonable price (<$20 on sale or used, with a number of hd-dvd discs bought on closeout for <$10). win-win as I see it. At worst, I have the best upscaling dvd player on the market :)
Seriously. What Sony should have done is make DVD's that would be read like a DVD on a DVD player, but read like a Blu-Ray disc on a Blu-Ray player. They had the technology years ago, but never did anything with it. Instead companies went with dumb double-sided discs or packaged a DVD with a Blu-Ray disc.
If Sony had just sold all their DVD's with a Blu-Ray layer for a couple of years, then they could just tell customers that they can take advantage of the movies they already own when selling the Blu-Ray players.
Maybe Apple should use their iTunes strength to sell high definition H.264 DVDs at kiosks in their stores, and allowed for similar DVDs to be burned off iTunes when videos were purchased.
If only AppleTV had a DVD drive in it, they could have had it all.
Sorry, Dave, I forgot to give you a head’s up as soon as I posted this. I meant to.
I wanted to start purchasing all my new videos on Blue-Ray. I purchased one last year. It’s a nice unit. Didn’t cost me an arm and a leg, but the video is incredibly clear. Still, my old DVDs look quite good on our HDTV, using the Blue-Ray machine’s upward processing of the old DVD format.
I’d like to see them iron this out. I think Blue-Ray does have a future, it’s mass storage for computers among the best reasons for it to remain around.
If it doesn’t, I wonder what the next big thing will be. DVDs are destined to be swapped out at some point.
Then I am smoking crack also. I am happy with my up-convert DVD players on my 40" and 52" TV's and love my DISH HD.
You may be right with regard to certain DVD/BR comparisons. I have run some comparisons with my own DVD/BR movies, and the difference was nowhere near as much better as I had thought it would be.
My old DVDs look pretty great upped. Yes the BR version is better, just not ‘as better (;-)) as I would have thought.
We have a 56” 1080p set that provides an amazing picture.
The pipe is going to have to get a lot bigger for download to become the primary medium. I’ve got a nice fast cable internet connection but in the time it takes to download a movie I could go to Target buy the DVD and watch it.
Streaming might replace rental but the pipe needs to get a lot faster for download to replace ownership.
Do you think the monthly download caps, will negate any benefit of downloading?
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