One reason Blu-ray prices will drop

[stratman]

Well, before it was the "war", now it's lack of competition, those on the red camp accuse blu of taking advantage of red's demise and sticking it to average joe. Some decry the lack of offers and specials now that Toshiba left the building. Well, there is good news, apart from my stance that blu will have to adapt to consumer's purchasing pattern or be relegated to LD status pronto. This story touches on one aspect we all forgot, component manufacturers.

Players for $200 ‘Widely Expected’ by the Holiday Season

Posted in Milestones, Players on February 27th, 2008

In this report on semiconductors used in Blu-ray and HD DVD players, we read of an interesting expected trend for the player core silicon as well as retail pricing.

The article notes that chip makers like Zoran and Mediatek are intending to join Blu-ray veterans Broadcom and Sigma Designs in releasing chipsets for Blu-ray players.

Mediatek spokeswoman Sophia Liang said her company has “a project on schedule to launch chips” for Blu-ray players, though she declined to provide further details.

Zoran demonstrated multimedia processors for both Blu-ray and HD DVD at the Las Vegas Consumer Electronics Show in January. “While we have proceeded cautiously during the format wars, planning to go as the market and our customers direct, going forward we will fully support Blu-ray,” said Dave Pederson, vice president of corporate marketing.

An increase in the number of chip building for Blu-ray seems destined to speed up chip commoditization and price declines, and consumers will be the winners. Ken Lowe, vice president of strategic marketing at Sigma Designs, said it’s widely expected that new Blu-ray players from China and Taiwan will be in stores at prices near $200 in time for Christmas.

 

[Johnd]

it’s widely expected that new Blu-ray players from China and Taiwan will be in stores at prices near $200 in time for Christmas.[/COLOR]

Perhaps strat. But will they be 2.0 profile?

Just for the record, I'm in neither camp. If I could get two flagship and one mid class BD player, as well as 46 titles for $670.00, I'd own one (or two or three) of them also. But it just ain't so. I was however able to do that with HD...and I didn't have to wait til Christmas.

Maybe a BD player from China will be available at Christmas for $200.00. But it's all about the software. I just don't believe the mass market will shift to BD until titles approach $15.00. I don't care if they sell the player for $10.00. If they don't reduce the msrp of BD titles to $15 or $20 at b&m stores, DickandJane just ain't gonna bite. Imho

Hey...Good morning btw strat.

 

[stratman]

Good morning John,

Yes I agree with you, software price is the key to survival. But this is a step in the right direction in the road to mass consumer adoption. Given the choice of spending $50.00 on a DVD or a Blu-ray player the answer is obvious, but as long as the software is affordable and competitive with standard def DVD.

 

[allargon]

Prices will drop when the newer models come up to replace the older models. We saw this with HD DVD and Blu-Ray. However, prices are remaining steady well into the summer from the looks of it. Some have even started to trek upward!

http://www.tomshardware.com/2008/03/03/pricewatch_hd_dvd_in_free_fall_blu_ray_continues_upward_trend_/

Part of the problem with the Blu-Ray standalones as opposed to the cheaper Toshiba HD DVD standalones is that they all contain multichannel analog outs. The Toshiba's (except for the plasticky A35) that had multichannel analog outs were $500+, too. (Heresy on audioholics!) This isn't necessary for most people. Hell, most people I know listen to movies via their TV speakers. (Note to self: get savvier friends.) Of course, Denon saw the need for a player with only a HDMI port out. They even kept costs down by not making the player profile 2.0 compatible saving pennies on an Ethernet port. Too bad the thing lists at $1k.

 

[Johnd]

Good morning John,

Yes I agree with you, software price is the key to survival. But this is a step in the right direction in the road to mass consumer adoption. Given the choice of spending $50.00 on a DVD or a Blu-ray player the answer is obvious, but as long as the software is affordable and competitive with standard def DVD.

Yes, it is a step in that direction. At the risk of appearing infinitely and incorrigibly pugnacious : that's precisely what HD did. They've had $150 players "forever." And their title prices were invariably (and substantially)cheaper than BD title prices. Only now are the software prices below $15...how long, if ever, will it take BD to get to that magical number for their titles? In the meantime, I'm deliberately selecting HD titles on my high preference list for under $12 per...and I'm not average Joe (in the high def dept.).

All I'm saying is that BD better wake up and smell the coffee. Their current life support is not sustainable for very long. Christmas? Hmmmmm...time for some more caffeine.

 

[stratman]

Given a slowing economy, BD does not have the luxury of time on it's side. If it doesn't react quickly to market patterns, there's only one option: failure, just like LD.

 

[davidtwotrees]

You guys are way off base. John Q. Public doesn't buy dvds. What do they care what the price is to buy a blu ray disc? Of all the people I know, and all the residences I work in for my job, I'm gonna say 1% of them have a library of movies. It is rare to see, and I notice things like that. Percentage of these people with Blockbuster/Netflix accounts? I would go with 40%. This is just my personal experience, but I do work in a LOT of homes during the course of the year. (painting/remodelling contractor) I would say half of these people have even heard of bluray. The only way HD content discs will become mainstream is if they replace DVD. Show me how that scenario will take place with what I have sketched above, and I will believe it when I see it. I just don't see it happening unless you force it on the public, otherwise they don't care.

 

[Johnd]

Prices will drop when the newer models come up to replace the older models. We saw this with HD DVD and Blu-Ray. However, prices are remaining steady well into the summer from the looks of it. Some have even started to trek upward!

http://www.tomshardware.com/2008/03/03/pricewatch_hd_dvd_in_free_fall_blu_ray_continues_upward_trend_/

Part of the problem with the Blu-Ray standalones as opposed to the cheaper Toshiba HD DVD standalones is that they all contain multichannel analog outs. The Toshiba's (except for the plasticky A35) that had multichannel analog outs were $500+, too. (Heresy on audioholics!) This isn't necessary for most people. Hell, most people I know listen to movies via their TV speakers. (Note to self: get savvier friends.) Of course, Denon saw the need for a player with only a HDMI port out. They even kept costs down by not making the player profile 2.0 compatible saving pennies on an Ethernet port. Too bad the thing lists at $1k.

Yeah, allargon, but in this day and age there is not such an animal as "one player for all" or the "infinitely universal BD player that will connect to anything." Were we still living in the tube days, that premise may hold true.

$500 for the A35? I know it msrp'ed for $599 or $699...but it was regularly selling for $300 (maybe $350) just about as soon as it came out (Oct '07) on the internet. And is that remotely a fair comparison (the A35 to some budget model)? The A35 is Toshiba's Flagship player. HD kept their player costs reasonable with the A2...always sold for about $150...with 7 movies (generally)! I love my multichannel outs on my A35. I have three sets of 7.1 multichannels on my aging 5803...and they are now put to good use:
one set for sacd via 2900 and another set for DD+ and True via the A35 (and other fomats). I get DTS ES via optical. Ohhh, the cabling...all the cabling.

 

[Audioholics]

But will they be 2.0 profile?

Very doubtful... and you can bet they will be partially crippled in some other way. HDMI out is making the new players out to be essentially transports - which begs the question: How is a $2000 player supposed to be better than a $200 player if the signals are all digital?

If you aren't using analogue outputs and have HDMI 1.3a-capable audio receivers... this becomes a very strange market indeed.

 

[Johnd]

You guys are way off base. John Q. Public doesn't buy dvds.

He doesn't? So it was only guys like us that spent the 25 billion in 2006 in buying (and renting) movies? Well I think you're wrong david.

I think John Q. Public absolutely DOES buy movies. Perhaps not to the extent we do. But he does, and it is largely cost driven (meaning, John Q. will generally reject the purchase of a $20, $25, $30, $35...and $40 movie. $10 or $15? scales skyrocket).

 

[Johnd]

Very doubtful... and you can bet they will be partially crippled in some other way.

That's the rub...isn't it Clint?

HDMI out is making the new players out to be essentially transports - which begs the question: How is a $2000 player supposed to be better than a $200 player if the signals are all digital?

I'm not so lucky to have HDMI on my receiver...I'm a dinosaur. Someday...someday. But good point. Digital connections will invariably lessen the price of the low and mid class players (and receivers).

If you aren't using analogue outputs and have HDMI 1.3a-capable audio receivers... this becomes a very strange market indeed.

Neither holds true for me (no HDMI...using analog). It seems I got caught between the crest and the trough on this latest technological wave. But I agree it is exciting and interesting to see how much we can get (sound and picture) for how little. That is, after all, what appeals to the mass market, and it is the bread and butter for the manufacturers. And for how simple the connection (one HDMI cable) is. It's both a wondrous time, and a trying time...you almost need an EE degree to have a rudimentary understanding of all this stuff.

 

[allargon]

I think John Q. Public absolutely DOES buy movies. Perhaps not to the extent we do. But he does, and it is largely cost driven (meaning, John Q. will generally reject the purchase of a $20, $25, $30, $35...and $40 movie. $10 or $15? scales skyrocket).

He does. Moreover, he buys those "foolscreen" movies so he won't have them there black bahs on his screen. When he finally upgrades to a widescreen TV he will use that stretch/format button in a way that would make TNT, TBS, A&E and the history channel proud.

You have a Denon 5803? Niice...

Back on topic... I give the Blu-Ray guys one month to start lowering prices. That was the time table they gave for Universal, Paramount, etc. to switch after Warner's defection. (No, I'm not bitter... )

 

[Johnd]

He does. Moreover, he buys those "foolscreen" movies so he won't have them there black bahs on his screen. When he finally upgrades to a widescreen TV he will use that stretch/format button in a way that would make TNT, TBS, A&E and the history channel proud

.

I never understood the uptightness factor over black bars...doesn't bother me a bit.

You have a Denon 5803? Niice...

Yeah...thanks. I'm really happy to experience DD+ and especially True with it. I was always hugely impressed w/ DD EX and DTS ES (on good tracks). True adds another dimension. I'm glad my A35 passes that signal to the 5803. It's given something of a rebirth to my 5803.

Back on topic... I give the Blu-Ray guys one month to start lowering prices. That was the time table they gave for Universal, Paramount, etc. to switch after Warner's defection. (No, I'm not bitter...

You think it will happen that quickly, huh? I'm a bit more skeptical allargon. I think they're going to milk those over inflated msrp's on the majority of titles for as long as they can...perhaps to their demise. We'll see. If and when they come down to $15 or $20 per title, I may consider getting an entry level BD player for those titles unvailable on HD. Otherwise, I'm perfectly content (ecstatic, actually, at times) with my HD titles, players, and their upscaling prowess.

 

[j_garcia]

If it doesn't start to take off and sell like they want, you can expect deals and price drops to follow quickly, especially in the face of a recession. I expect most won't really adopt until the holidays. Fence sitters will go for it, but the rest of the public will still wait until Black Friday.

 

[BMXTRIX]

Yes, it is a step in that direction. At the risk of appearing infinitely and incorrigibly pugnacious : that's precisely what HD did.

Sorry... What?

They've had $150 players "forever."

Toshiba most definitely did, and admitted to serious losses on every player sold. But, to the consumer it was a good deal and the reason why I picked up an A2.

And their title prices were invariably (and substantially)cheaper than BD title prices.

This is 100% false. In fact, HD DVD regularly had titles that were on the combo format and ran 5 bucks more than the Blu-ray counterpart. Going into the holdiay 2007 season, Blu-ray ramped up sales on discs which made Blu-ray even less expensive and movies available for under 15 bucks a pop. I have about 22 BD movies and paid, on average, less than $15 each. This was typically about $8 less than the corersponding HD DVD movie on Amazon at the exact same time.

There were some HD DVD specials that ran at times, and those were also good deals, but MSRP on the same movies tended to match one another from WB at the least, or be very similar according to Amazon disc pricing history. It was, one of HD DVDs greatest lies, and should not be perpetuated after the death of the format.

Only now are the software prices below $15...how long, if ever, will it take BD to get to that magical number for their titles? In the meantime, I'm deliberately selecting HD titles on my high preference list for under $12 per...and I'm not average Joe (in the high def dept.).

Clearance pricing is not really the same as sale pricing I would have to say.

All I'm saying is that BD better wake up and smell the coffee. Their current life support is not sustainable for very long. Christmas? Hmmmmm...time for some more caffeine.

Their current strategy led them to defeat HD DVD quite handily and continues to show 100%+ gains in hardware sales compared to the same time last year. Without a format war, it is possible for far greater consumer adoption of the format without fear of choosing the new Betamax - that's already been decided upon.

The BDA is far more aware of current market conditions, marketing trends, and what needs to occur than any of us are since they actually see the sales of players on a daily, weekly, and monthly basis with real numbers. So, I think they are very much awake, and steering a ship they have carefully designed.

Titanic? Perhaps - but the captain may not be saying full speed ahead this time.

 

[TLS Guy]

Well, before it was the "war", now it's lack of competition, those on the red camp accuse blu of taking advantage of red's demise and sticking it to average joe. Some decry the lack of offers and specials now that Toshiba left the building. Well, there is good news, apart from my stance that blu will have to adapt to consumer's purchasing pattern or be relegated to LD status pronto. This story touches on one aspect we all forgot, component manufacturers.

Players for $200 ‘Widely Expected’ by the Holiday Season

Posted in Milestones, Players on February 27th, 2008

In this report on semiconductors used in Blu-ray and HD DVD players, we read of an interesting expected trend for the player core silicon as well as retail pricing.

The article notes that chip makers like Zoran and Mediatek are intending to join Blu-ray veterans Broadcom and Sigma Designs in releasing chipsets for Blu-ray players.

Mediatek spokeswoman Sophia Liang said her company has “a project on schedule to launch chips” for Blu-ray players, though she declined to provide further details.

Zoran demonstrated multimedia processors for both Blu-ray and HD DVD at the Las Vegas Consumer Electronics Show in January. “While we have proceeded cautiously during the format wars, planning to go as the market and our customers direct, going forward we will fully support Blu-ray,” said Dave Pederson, vice president of corporate marketing.

An increase in the number of chip building for Blu-ray seems destined to speed up chip commoditization and price declines, and consumers will be the winners. Ken Lowe, vice president of strategic marketing at Sigma Designs, said it’s widely expected that new Blu-ray players from China and Taiwan will be in stores at prices near $200 in time for Christmas.

Damn it! You write like a good professional journalist.

 

[Johnd]

Sorry... What?

You don't get that?

Toshiba most definitely did, and admitted to serious losses on every player sold. But, to the consumer it was a good deal and the reason why I picked up an A2.

And undoubtedly at a serious bargain price...with free movies.

This is 100% false.

No it's not. It's not hard to establish that BD prices are higher than HD prices. This is a known fact to any shopping consumer. And a combo disc is not a fair analogy...that is two movies...not one. I'm not going to try to prove to you the price discrepancies between BD and HD in hardware and software...this is not a little known fact. And the discrepancies have grown to be quite substantial now. Nevermind that immediately upon Toshiba's announcement a couple of weeks ago, B&M stores (and most internet sites) have jacked most of their BD discs to msrp, and the discounts are minimal (as we speak).

 

[aberkowitz]

And a combo disc is not a fair analogy...that is two movies...not one.

But there were many HD DVDs that are only sold as combo discs (e.g. 300, American Gangster, Knocked Up, the Star Trek TV series) so in those cases an HD DVD consumer had no choice but to pay a premium to buy the combo disc if they wanted to have the High Def version.

 

[allargon]

Yes, it is a step in that direction. At the risk of appearing infinitely and incorrigibly pugnacious : that's precisely what HD did. They've had $150 players "forever." And their title prices were invariably (and substantially)cheaper than BD title prices. Only now are the software prices below $15...how long, if ever, will it take BD to get to that magical number for their titles?

HD DVD didn't have $150 players until November. $200 (usually $250) players appeared sporadically during the summertime after the initial Father's Day price drops. Blu-Ray actually had cheaper software prices than HD DVD for most new release titles. Universal and Warner bent HD DVD owner's over with combo discs that cost $3-10 more than the equivalent Blu-Ray. Paramount added a second "bonus" disc to justify their higher prices. Blu-Ray also had more BOGO free sales.

Water under the bridge... Seriously, the same bloggers that trumpeted Blu-Ray over HD DVD now need to lean hard on the Blu-Ray folks about the profile mess as well as player prices. Swanni already started.

http://www.tvpredictions.com/sonyblu030508.htm

http://www.tvpredictions.com/bludvd022908.htm

 

[BMXTRIX]

No it's not. It's not hard to establish that BD prices are higher than HD prices.

It's darn near impossible to establish since any studio releasing the same movie on both formats released it at the exact same price - unless it was a combo in which case the HD DVD was more expensive.

This is a known fact to any shopping consumer.

At High Def Digest is was one of the biggest complaints about HD DVD. That while players were cheap, the media was more expensive on average and had almost no sales on the movies at all. Blu-ray was a far better post player buy for consumers.

And a combo disc is not a fair analogy...that is two movies...not one.

As said, if you only want the HD DVD version, it was the only choice you had.

I'm not going to try to prove to you the price discrepancies between BD and HD in hardware and software...this is not a little known fact.

It is far from a known fact because it is far more accurate, looking at online pricing (Amazon) that average pricing for HD DVD always hovered around the exact same price per title - and HD DVD had a complete lack of sales throughout the 2007 holiday season.

Now, with end of life pricing, things are well out of line of typical HD DVD pricing on products.

...immediately upon Toshiba's announcement a couple of weeks ago, B&M stores (and most internet sites) have jacked most of their BD discs to msrp, and the discounts are minimal (as we speak).

I'm not sure of any B&M stores that didn't run both formats at or near MSRP unless sales were going on. Now it isn't a sale for HD DVD though - it's a clearing of inventory.

As a matter of courtesy, I think at the very least people should back up claims when they say things which are argued at least at some level, so here it is:

http://www.eproductwars.com/dvd/

The very top chart includes Amazon average pricing per disc dating back to September of last year and the 'daily' leaders in several categories, which included price. You will see that about 2/3 of the days of the past six months had Blu-ray at a lower price on average compared to HD DVD.

I'm not trying to irritate you, but I just don't know where you are getting your disc pricing from which leads you to believe that your arguement is correct since the actual numbers don't reflect it.