Blu-ray Awaits Its Spoils
Saturday, May 24, 2008
Blu-ray may have won the format war, but it hasn't won over many consumers.
Now was supposed to be the boom time for the young video technology, pitched as a high-definition replacement for the DVD. In January, consumer electronics company Toshiba dropped support of rival format HD DVD, ending a competition over which technology would take root in living rooms.
Both technologies were designed to take advantage of the picture resolutions offered by new, high-definition TV sets with a level of image quality that the standard DVD is not capable of producing. The new players for both technologies can also play DVDs, and each format uses media that looks like the same silver discs movie fans have been popping into their DVD players for years. But both require users to upgrade their movie collections and buy the more expensive new discs if they want to enjoy the benefits.
Though neither Blu-ray nor HD DVD thrived last year, analysts pinned the low sales on consumers who were reluctant to spend money on a new technology that might turn out to be the loser in the competition.
But even without competition, Blu-ray is still struggling, according to some recent sales figures. According to research firm NPD Group, sales of Blu-ray players dropped 40 percent from January to February. The next month, sales rose 2 percent.
Blu-ray Disc Association spokesman Andy Parsons said the NPD numbers are misleading because they demonstrate a weakness in player availability, not in consumer interest. No manufacturer or retailer anticipated a quick, decisive end to the format war, so none had a deep supply of the players on hand when it became clear that Blu-ray had won, he said.
"There was a sudden increase in demand when there was a sudden decrease in supply," he said.
Brian Lucas, a spokesman for Best Buy, agreed. "When the format war ended, we didn't do as much promotion around [Blu-ray] as we would've liked," Lucas said. "We didn't want to send people into stores where there wouldn't be players." Lucas said that player supply has been improving.
Other research doesn't make the coming months look much more promising for the young format. A recent Harris Poll found that only 9 percent of consumers who don't own a Blu-ray player have an interest in buying one during the next year.
"I think people are price sensitive," said Joan Barten Kline, vice president of the interactive media and entertainment division at Harris, who said she thinks the number of buyers will be below that 9 percent figure. In any case, she is among those buyers. She recently went shopping for a movie player and found Blu-rays selling at about $400 and DVD players selling at under $100. She opted for the DVD.
Michael Gartenberg, a consumer electronics industry analyst with research firm Jupiter, said that the new format should be selling faster by now but "Blu-ray has not come up with a compelling message for the mainstream consumer."
"During the course of the battle, consumers lost interest in both formats," he said