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Best Buy Sells Blu-ray Player Below $200

20 Oct, 2008 By: Erik Gruenwedel

Best Buy Co. is selling its proprietary Insignia brand Blu-ray Disc player for $199 (after a $30 in-store discount) — more than 40% off the suggested retail price.

Industry observers have long considered a sub-$200 price point key to bridging the demarcation line separating early adopters from mainstream consumers.

The Profile 1.1 (NS-BRDVD) player, which includes $100 in discount coupons on select Blu-ray movies, has been viewed as a “conversation starter” designed to spark consumer interest in high-definition packaged media, according to a spokesperson for Minneapolis-based Best Buy.

In addition, the price drop, less than six weeks before Black Friday, when retailers traditionally slash prices on select consumer products heading into the holiday shopping season, follows a move by Target Corp., which last week bowed an Olevia-brand Profile 1.1 player for $229.

James McQuivey, principal analyst with Forrester Research, said he is surprised by the price cut since Blu-ray manufacturers he spoke with in 2007 said it was not economically advantageous to go below $299, much less $200.

“That's what happens when an economy goes south and people are staring at the prospect of leftover inventory,” McQuivey said. “Like any other market-driven panic, this one will lead to copycats. I don't expect the $199 to be common, but every retailer will want at least one model at that level, if only to seduce people into that section of the store.”

The analyst said that should fourth-quarter retail sales freefall, he would expect to see multiple $199 units with $20 rebates and free discs thrown in.

“In other words, this could get [uglier] before it gets pretty again,” McQuivey said.

Independent analyst Bruce Leichtman doubts the price cut signifies a Blu-ray player price war. Rather, he said, the move is designed to spur wider consumer interest.

“The magic price point has always been perceived to be $200,” Leichtman said. “And it will go lower.”

He said the reduction was more a reflection of pricing and volume than a price war. Leichtman said Blu-ray player sales would be adversely affected by the current economy to some degree, but that they remain a strong holiday consumer electronics item.

“Will holiday spending be axed entirely?” Leichtman said. “I don’t think so.”

Separately, Circuit City is offering Samsung’s Profile 2.0 (BD-Live) player for $399.99, which includes the promotional Road to the Super Bowl Blu-ray Disc from NFL Films.

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