Blu-ray set-top players out-selling HD DVD

[GaryPen]

What will constitute a win?
All studios publish in one and only one format?

If yes, I'm ready to take the other side of the bet.

Diogen.

No. Because even if HD-DVD were to take the clear lead, Sony will hang on for too long afterward, as they did with Beta, as they did with MD, and as they are still doing with Memory Stick. OTOH, if BD is clearly in the lead by then, I think HDDVD will fold.

In either case, there will be a clear leader by Xmas '08, with one format outselling the other in both HW and Titles. At this point, it's hard to say which. I am rooting for HD-DVD, as I recently purchased an A2. But, simply wishing one format success does not cloud my ability to weigh facts objectively.

Xmas '07 will be very important, and a gauge of things to come. Xmas '08 will be the final stand.

 

[GaryPen]

PS3
People don't want to admit it, but Sony's trojan horse did put more blu-ray players in homes than HD-DVD hopes to have in them.

PS3 has caused Sony's PlayStation division to lose money for the first time. They are having some serious problems over at the house that Akio built. Just an FYI.

 

[mike123abc]

BD seems to be buying a lot of placement. Now when I walk into Sam's Club end cap right as you walk in a Sony 46" LCD TV and BD display. Walk into the local Circuit City couch set up with LCD display playing Pirates OTC on BD, right up front. Best Buy running BD demo. HD-DVD players not to be seen on display.

 

[FreddyvsJasonvsAsh]

When it cost $800 to make a PS3 and they sell it for $500 they are losing $300 per PS3 sold...I think Sony put to much hope into the system. In the end Blu Ray will be joining the likes of records, 8-track, betamax and laserdisc by the summer of 2009!! Lionsgate will jump before WB over to HD DVD due to the fact BD are more expensive to make and they are just not financially big like WB. Then Starz/Anchor Bay then Warner/New Line.

 

[CochiseGuy]

PS3
People don't want to admit it, but Sony's trojan horse did put more blu-ray players in homes than HD-DVD hopes to have in them.

Beat me to it!

Yes, the PS3. I don't mind admitting it - yes, Sony's Trojan Horse did put a heck of a lot more BD players in home, as it was supposed to. But what it didn't do was put such an overwhelming number of BD players in the homes of BD movie buyers that it killed off HD DVD like it was supposed to me. (The BDA claiming at CES January 2007 the war was 'over' ring a bell?)

The last numbers I saw were around 1.8 million PS3's sold in the US vs. around 300,000 combined HD DVD players/Xbox add-ons. A 6 to 1 advantage in players, but only a 3 to 2 advantage in disc sales the past few weeks. That's why Studio Execs keep saying it is standalone players that will determine the outcome of this format war.

 

[navychop]

No. Because even if HD-DVD were to take the clear lead, Sony will hang on for too long afterward, as they did with Beta, as they did with MD, and as they are still doing with Memory Stick. OTOH, if BD is clearly in the lead by then, I think HDDVD will fold.

This brings up an interesting thought. HOW, exactly, will the end come, assuming it does for one of the formats? Would Toshiba announce they've given up, or just quietly stop production? Or would it go out because studios stopped producing HD DVD versions? Or would the end come with most retailers no longer buying HD DVDs?

And if it were the other way around- would Sony quietly fold? Not likely, since the PS3 games are on Blu-ray discs. And of course, Sony Entertainment could always make a point of publishing BDs.


Separate issue- It is not unusual for one division to take a loss to benefit other divisions of the company, or to take a loss for years in order to garner market share. In fact, you might say the Japanese have made this into an art form.

BTW, I doubt Sony loses $300 per player now. That's outdated. The laser diode assembly has come way down in price ($100?) as well as other economies due to smaller die sizes, fewer chips and dropping the emotion engine. I doubt they're making any money on them, but maybe breaking even sometime in the 4th quarter. I've read they've ordered millions of PS3s from China (10M?) for Q1 08. They must have big expectations for next year. A few superb games, cheaper prices all around, including for HDTVs, may all combine to increase sales. But that's a heck of an increase!

 

[GaryPen]

I think it will be apparent which format prevails by the number of players and movies sold, as well as how many hw manufacturers and studios choose one over the other. (Currently, in the above categories, it seems about even.)

You are correct in that Sony will still continue to release tiitles on BD, even if it becomes clear they have lost the war. They will have a lot of PS3's out there, and have invested a lot in the format. They are also quite stubborn, as evidenced by their continued use of Memory Stick, even though everybody else uses some flavor of SD. Last time I was in Japan, I noticed they hadn't given up on MD either. They also have their own stupid names for other industry standards, like iLink instead of FireWire.

OTOH, if Toshiba feels all is lost, they will probably just close up the HD DVD shop, and move on. Although, with MS backing the format, they may keep up the fight.

Yes. Japanese companies may have a history of losing money on a product, with long term profit in mind. But, the PS division has always been a huge money-maker for Sony. Now, it loses money hand over fist. Sony has other problems. Their battery division is screwed because of laptop batteries that burst into flame. Their consumer electronics are no longer the best. In fact, some of it is downright crap, due to cost-cutting. They've got some serious problems over there.

 

[mike123abc]

This brings up an interesting thought. HOW, exactly, will the end come, assuming it does for one of the formats? Would Toshiba announce they've given up, or just quietly stop production? Or would it go out because studios stopped producing HD DVD versions? Or would the end come with most retailers no longer buying HD DVDs?

Did Sony ever really give up on Beta? The loser of the battle will probably linger around for many years now, the installed bases are too large to be ignored now. Probably combo players will get cheap enough that people will no longer care.

 

[navychop]

Could be. But they've got to convince studios to keep releasing in their format, and retailers to carry them. If combo players became common, retailers might see that as an easy way to just carry one format.

 

[navychop]

GaryPen- Amen to that. And the most serious problems are at the top- where customer-hostile execs approved the root kit, and some decidedly substandard products. I know, I have a few. I just wish it was someone other than Sony that was the prime force behind BD. But I overcame my dislike of Sony to buy into what I view as the better format. I can understand others having such dislike of Sony that they hope for ill to visit upon Sony and all their products, including Blu-ray.

 

[charper1]

Did Sony ever really give up on Beta? The loser of the battle will probably linger around for many years now, the installed bases are too large to be ignored now. Probably combo players will get cheap enough that people will no longer care.

No, in fact it lingered in the public/end user arena for a long while and in the private/pro/news arena for even longer if not until just recently; maybe still in use in some smaller orgs. Beta-cams and beta commercial players were/are the standard (those that have not switch to some digital based systems); some places I knew prefer using Digital Hi-8 (I prefer this format for tape too)

 

[Derwin0]

PS3 has caused Sony's PlayStation division to lose money for the first time. They are having some serious problems over at the house that Akio built. Just an FYI.

Not a big deal, as Microsoft has never made a profit on the Xbox division. The key is to make up the revenues in other areas.

 

[meStevo]

That's true, but gaming is a much bigger part of the bottom line for Sony than it is for Microsoft. From an investor perspective their massive losses are hard to ignore.

 

[JoeSp]

That's true, but gaming is a much bigger part of the bottom line for Sony than it is for Microsoft. From an investor perspective their massive losses are hard to ignore.

Not really, Sony makes alot of differant products and every divison makes money. The PS2 is still on its way to selling 3 million this year while the PS3 is chugging along behind in sales but on target to meet the sales results of the XBOX360's first year talley. And Sony makes a killing at the boxoffice -- hence their pull on the HD movie market. It wasn't until the advent of the PS2 that Sony's gaming market became so big and so profitable. Maybe they thought they could sell at $599 and folks would buy the PS3 just like they did the PS2. Bad decision!

 

[GaryPen]

Regardless of Sony's problems or lack of problems, I think we will need to wait until January '08, when the dust settles on the '07 shopping season to get a better gauge of where things are going in this war.

Unless there are other major announcements before then of studio or hw manufacturers' realignment, or a $200 BD player, that is when the next big indicator will be.

 

[GaryPen]

Not really, Sony makes alot of differant products and every divison makes money.

Every division does not make money, even if the parent company does, as a whole.

 

[jayn_j]

I'm not sure that even a clear leader will cause this war to end, nor that the format that is leading will eventually be the winner.

I still remember vividly that as a laserdisc fan, I watched the RCA CED system sign up multiple manufacturers and get exclusives from several major studios, including Disney. They had pretty much driven laser off the shelves when, out of the blue, RCA pulled the plug.

I agree that Sony is stubborn, but Toshiba has a lot of history as well. I suspect some behind the scenes backing from Phillips too.

 

[navychop]

But their system was clearly inferior. It was an absolute piece of (fill in the blank). It's only redeeming feature was it was supposed to be cheap. Imagine, trying to foist off a video disc that would wear out thru use like an old LP record! The capacitance system was limited in many ways. I wonder if it's only purpose was to kill off the laserdisc?

How many people actually bought a player, anyway?

 

[1080iBeVuMin]

I'm not sure that even a clear leader will cause this war to end, nor that the format that is leading will eventually be the winner.

Agreed. I am the only person I know who has any kind of high def player or any interest in it. A good friend of mine answered "No" when I asked if he ever heard of Blu-Ray. Our best (and busiest) local video shop has no high def rentals and they have no idea when (or if) they will get either format. The owner acted like he never considered the question when I asked about high def.

The format war is not on anybody's radar. So I definitely agree that the format war is far from over. The format war has probably barely begun.

Meanwhile, there are plenty of players and titles for those of us who are interested. I will enjoy my Blu-Ray rentals from blockbuster online.

 

[jayn_j]

How many people actually bought a player, anyway?

Or how many will admit it? They actually sold pretty well for the first year or so. They were outselling laserdisk 8:1 and the top 10 disc sales were all CED during that period.

I once bought a new Chevy Vega. How many will admit to that either?

The point is that differences in small volume sales arer not a good indicator. You are right about CED being garbage, but that just reinforces the point. For all the heat generated here, the two formats are both pretty equal and the differences are not going to be what kills either one or both. This is one giant game of chicken. Both camps have gotten into their cars and are speeding right at each other. Who is going to flinch first?