Is Blu-ray a Winner, Or a Stumbling, Bumbling Survivor?
Written by Video Savant
Friday, 25 April 2008
There have been a number of recent research studies examining the current state of Sony's Blu-ray next-generation packaged media format, including one from Strategy Analytics a few weeks ago that was dissected here shortly after its release -- Is 29 Million Blu-ray Players by End-2008 Good News?
The key disconnect I found in the SA study is its forecast that 80% of all Blu-ray hardware sales this year are expected to be in the form of either PS3s or BD drives installed in desktop and laptop computers. Therefore, it was difficult to understand the basis for its conclusion that standalone Blu-ray players would suddenly become the leading contributor to BD sales beginning in 2009. This is sort of like a car that goes from 0 to 60 miles per hour in just 10 seconds, suddenly improving to 0-60 mph in less than 5 seconds, with the turning of calendar pages the only explanation offered for a massive change in performance.
Now, a new study by ABI Research suggests that PlayStation 3 will continue to be the main force for Blu-ray sales for another 5 years. As reported by Engadget HD:
Blu-ray still has a lot of convincing to do before ABI believes it's the future, mostly because of upconverting DVD players. According to the analyst's figures, while 35% of DVD players sold today (that low?) upconvert, 60% will by 2013 (again, that low?). The state of Blu-ray hardware going forward isn't to their liking either, with principal analyst Steve Wilson stating "studios better hope that people are playing movies on their PlayStations. Otherwise there's very little installed base." With PS3s accounting for 85% of Blu-ray players in 2008, ABI doesn't see things evening out until 2013, with high prices for dedicated players keeping sales volume lower than studios would like.
I'll concede that these sorts of research reports, in general, are notorious for getting things wrong, usually as a result of focusing on the predetermined needs and desires of the company underwriting or promoting the study, or by the researcher themselves, who are highly motivated to produce the sort of findings that generate widespread business and general news coverage. It's certainly possible that both Strategy Analytics and ABI Research have got it wrong, and that standalone Blu-ray sales are quietly gaining momentum and share against both PS3 consoles and upconverting, standard-definition DVD players.
But that's now how I'd bet things are actually going. And I think the key problem here is that after beating back the HD DVD challenge, Sony has taken a complacent "now we just build it, and they will come" approach to Blu-ray marketing. Maybe I'm missing the forest for all the trees, but about the only time I hear any mass market promotion of Blu-ray is the "...and now available in Blu-ray Disc" tagline added to TV advertisements for the weekly batch of new DVD releases.
And this seems especially strange to me, considering that Blu-ray promotion represents one of those made-in-heaven marketing opportunities, where promotion of one product (Blu-ray) provides positive and complementary promotion for a whole slew of other products, including Sony HDTVs, Sony A/V receivers, Tri-Star and Columbia Picture properties, and PlayStation hardware and software, among others.
But then, the lack of effort by Sony to grow consumer awareness and demand for Blu-ray is pretty consistent with how the entire rollout of both Blu-ray and HD DVD was conducted. There was then -- and remains now -- very little focus on consumers. The format battle was ultimately fought and won almost entirely behind the scenes, with corporate politicking and financial enticements to studios being the blunt weapons of choice. Consumer reaction to HD DVD and Blu-ray was little more than a sideshow.
While there's no question that this strategy worked admirably well for Sony in eliminating the HD DVD challenge, it will not translate to a victory in the consumer marketplace. It's hard to understand how Sony could be dropping the ball so badly.
It seems that something has gone terribly wrong in the HDNA.