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CD Life Cycle Offers Insights for DVD

8 Nov, 2002 By: Thomas K. Arnold

I just read an interesting article on the 20th anniversary of the compact disc. The launch of the five-inch music disc in 1982 sounds a lot like the DVD launch 15 years later — in the beginning, no one could quite figure out what to do with it. Early goals were not met. But then all of a sudden things gathered steam and before long consumers were replacing their music libraries and the vinyl LP was history.

This quarter, consumers are making an incredible vote of confidence in DVD. Video sales are through the roof, with new records being broken almost as soon as they are set and bonus materials — far from the frills many initially saw them as — are proving an irresistible selling point.

But while everyone is all cheery and optimistic, we should never forget that the CD story wasn't exactly one of everyone living happily ever after. After a few boom years the music industry went into a slump, and only after hundreds of record stores were shuttered did we begin to see a recovery — a recovery cut short by the advent of digital downloading and the record companies' pathetic attempts to address digital downloading by 1) ignoring it in the hope it would go away, 2) filing suit to stop it before looking at ways to join in the party; and 3) keeping CD prices way too high despite study after study that showed $19.98 list was far too high a price to pay for any artist, much less a new and untried artist.

DVD sales won't continue to escalate, at least not at the rate they have been growing these last two years. Then there's the red-laser/blue-laser controversy, with the quest for a new standard still unsettled. Just look at what's happening over on the audio side — there's a brutal format war going on between the Super CD and true DVD-Audio and neither side is making much headway. Even if both sides do hack out a compromise (or if one throws up its hands in defeat and goes away), there's still no assurance of success, since the record companies face the formidable task of selling the public on superior sound at a time when the CD still sounds just fine to most mainstream ears.

Will the next-generation DVD visionaries and strategists have an easier time at it? Only time will tell.



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