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More Retailers Bow Sub-$100 Blu-ray Players

11 Oct, 2009 By: Erik Gruenwedel

Southern California consumer electronics retailers aren’t waiting until Black Friday to cut Blu-ray Disc player prices, including some below $100.

Ken Cranes Oct. 11 announced it would slash up to 50% off the retail price of in-store brand name Blu-ray players, including some models priced at $97.

Industry analysts have suggested Blu-ray player prices would fall to around the century mark next month on the annual day-after Thanksgiving sales when retailers attempt to jumpstart the winter holiday shopping season with special pricing and offers.

CE retailers this year have been including free or reduced priced Blu-ray players with purchases of big screen high definition televisions or home theater systems.

Ken Cranes and Paul’s TV also are selling select Internet-connected Panasonic BD players from $148.

Indeed, Wal-Mart has been selling Profile 1.1 (no Internet connection) Magnavox players at $98, and Fry's Electronics is selling refurbished Samsung Profile 1.1 BD players for $119.

Richard Doherty, director of The Envisioneering Group, a Seaford, N.Y.-based technology consulting firm, said the CE industry is cautiously optimistic the $100 Blu-ray players expected between Black Friday and Christmas will be profitable versus a loss-leader designed to entice shoppers.

Doherty said the good news regarding the discounted players currently on store shelves is their high functionality, including Internet connectivity and BD Live.

“We’re not sure the sub-$100 players that may debut at $88 or $97 from Wal-Mart and others are going to be a full-featured,” Doherty said.

He added that the cuts have resulted in the reality that BD players previously priced from $350 are now below $150, often bundled with select movies for special weekend promotions.

“There’s expected to be quite a price roller-coaster vacillation between now and Christmas,” Doherty said.

He said the recent price cut to $299 for the Sony PlayStation 3 video game system (which Doherty called the “world’s best Blu-ray player”) forever changed the market for the $300 BD player.

“It’s really a great buyer’s market,” the analyst said.

That said, Doherty added that many consumers are still unsure regarding whether a Blu-ray player will play standard DVD — a scenario the analyst attributed to lingering fallout from the format war with HD DVD.

“About 30% of consumers don’t understand that a DVD not only plays in a Blu-ray player, but looks great,” he said. “And many of those that do know it plays DVDs, don’t know that it up-scales to HD picture quality.”

Doherty said educating consumers about Blu-ray needed to continue.

“One-third of consumers is too many,” he said.

Separately, Blu-ray hardware price erosion has also resulted significant cuts to new release BD movie prices.

Blu-ray titles are retailing from 35% and 50% more than standard DVD versions — down from price premiums between 100% and 150% a year ago, according to Futuresource Consulting. Catalog Blu-ray prices are about 150% higher than standard DVD, which is 50% less than they were a year ago.

Futuresource analyst Jim Bottoms, in a note, described the price reductions as “very, very important in driving the [BD] market forward.”

Bottoms said the Blu-ray software price cuts would help ease consumers’ so-called “value judgment” regarding which version of a title they would consider purchasing during the recession.

“That dynamic is starting to shift a little bit,” Bottoms said.



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