johnnymk

http://blogs.zdnet.com/storage/?p=365&tag=nl.e550
Posted by Robin Harris


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.”

attgig

heh. I definitely agree with what he's saying. DVD's upconverted to 720p looks fine on my 720 set.

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Jihforce

meh...i like my blue-ray. looks much better than standard dvd.
i just think the movies themselves are a bit pricey. 20-30 bucks a pop is a bit "outrageous" in these market conditions.

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Cubsfan

VHS -> DVD was a huge step. DVD->HD not quite so much.

I think that HD DVD would have actually been doing much better at this point had it won. Had a lot going for it (mostly price). Oh well, Sony's lost these wars before. I think the xbox/Netflix HD content might really start to shoot a big hole in BluRay's market share.

LPMiller

there is a lot of blather in this article, but not a lot of fact to support it.

Fact is, bluray sales are going up. Iron Man was the biggest selling bluray disc ever. 20 percent of all retail sales of Ironman were bluray, 50 percent of online sales were bluray.

Market share is growing, and while it has slowed, the price cuts and black Friday should boost that, and it's not shrinking at a rate inconsistent with what is happening in the overall electronics market in general. It's not dead or dying. It could certainly grow faster, though, and certainly I can see it not having the legs of DVD because of downloading (though it took me 12 fricken hours to download Speed Racer HD from Sony, so I still don't think video download is quite there yet from a mass market standpoint). So i think this guy is a being a little too negative without actually looking at the numbers.

And I'm sorry, but upconverted looks good, sure, but not HD good. Dolby HD sound is really noticeably better then 5.1. It's not the jump DVD was to VHS, but it's not exactly a tiny step either.

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GuruX

Here are the three things that have prevented me from getting Blu-Ray (in no particular order)

1) BD+/BD Live fiasco. If I were to have purchased a first-gen Blu-Ray player, I wouldn't be able to play the latest discs at all. Considering the high cost of BD players, this was a serious let-down. Even the first DVD players can generally still play a modern DVD.

2) Quality isn't worth it. While there is a difference between Blu-Ray and upconverted DVDs, the simple fact is that upconverted DVDs are good enough. This isn't like the switch from VHS to DVD here. Ditto goes for the audio quality (I don't have a high-end sound system either...... nor do I need it.

3) BD players are s-l-o-w. There is no reason why it should take nearly a minute to load a disc and start playing it -- none at all.

My opinion, Blu-Ray (and even HD-DVD) was doomed from the start. Yes, I like my HD, but it isn't worth the price/headaches of dealing with firmware issues. Downloaded HD content will eventually be the way I'll go -- until then, I'll stick with my upconverting DVD player.

Blu-Ray does fill a niche market -- as did Laserdiscs in the past... but it just isn't for me (and most of the public).

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gwilks98

IMO, their problem is simply a function of price compared to alternatives. The jump between the two isn't enough to justify the price difference to the vast majority of the market.

I just watched a DVD upconverted to 1080p, and a BR at 1080p. I have to say I don't notice much of a difference on a 52" tv. My AVR is only 8 months old, and I don't have a dolby HD decoder in it, so that advantage is a niche advantage. It's just too new of a format.

Figure in the possibility that a LOT of home movie buyers converted to Netflix/Blockbuster online, and you have a significant problem. For the price of 1 BR, you can get 2 months worth of rentals for movies you probably won't watch more than a 1 or 2 times.

Once you factor in the lack of disposable income right now, BR is doomed at the current business model.

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MrGreg

If I didn't have a PS3, I wouldn't have purchased a blu-ray player. I'd have an oppo upscaling player. And the only blu-rays I've purchased are Planet Earth. But I do get blu-rays from netflix, which is nice.

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Jah Rulez

Best thing about Blu-Ray is that at my local Blockbuster when the new releases are gone on regular DVD, it's most likely on the self in BR format so I get to watch it.

Only BR purchases I've made are Planet Earth and 300.

On a side note, does anyone besides me get asked each and every time you rent a BR from Blockbuster "Do you have a BR player or a PS3, because you need one to watch this".......

DarkFury

Oh well...

I'm still not sold enough on Blu-Ray to buy into it yet... Thank goodness for "On Demand" video that is already HD formatted straight to my TV.

I don't watch most of old disk collections anyways... so meh on this from my POV.

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zippyjuan

I think the biggest issue is perceived price/ quality. Most people are perfectly happy with their present DVD players. And they are very cheap- as are the movies you can play on them. BluRay players have still not come down that much- not enough to compete with standard format. Then there is the cost of the movies. Standard DVD movies have been flooding the market with titles for $5 to $10 while BluRay discs are over $20. If you want it to take off you need more $100- 150 players and $15 movies. The transition to digital TV does not necessarily mean that people are getting the big plasma or LCD tvs to watch- which is pretty much what you need to enjoy the benefits of BluRay or HD-DVD.

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attgig

Can Bluray players play dvd's and upconvert them well?

nate el bueno

Looks like a new contender is coming

http://www.maximumpc.com/article/new...supports_1920p

I frankly never liked bluray. Part of the reason I'm sure is that we've never been a tv family. I doubt bluray/hd would look any better on an old 19 inch CRT

DarkFury

Most of the Blu Ray players I've seen have this feature...

InfiniteNothing

You probably can't even play it on an old 19" crt monitor because of DRM

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nate el bueno

Yeah, I'm just keeping it around for the winter months

eSDee

I'm still loving the $49 HD-DVD player I bought after Blue-Ray won. I've picked up a bunch of super cheap HD-DVD's like 300, Planet Earth, Full Metal Jacket, etc. and I have paid a bargain price. $9.99 max for single discs and $25 for Planet Earth. Cheap, HD fun

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Daversinger

1920p? does this mean a horizontal res of 3413.3333333. hmmm that is an odd number for the standard 16x9 ratio. I would think more like 1080p at a higher data rate say 108Mbit/s Whatever the case is I think Blu-ray needs to step it up for these incoming RED cameras

what about 2009 trans to digital tv? if people have just bought HDTVs why not a HD player of some type? ODs are getting old. Apple has got their head in the right place with itunes... jump on the bandwagon or bubye netflix and blockbuster in 5 years. ha ha that is just a silly prediction. I am thinking along the lines of a "youtube" like network totally separate from the internet. Is this a reasonable idea?

Jeffbx

Only if someone has the cash for a new infrastructure separate from the internet. One exists now, called 'cable TV', but they still insist on charging us to use it...