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Retail Singing About Blu-ray

27 Oct, 2005 By: Erik Gruenwedel

The tide appears to be turning blue — as in Blu-ray Disc — now that Warner Home Video has become the fifth major studio to join the Blu-ray Disc Association.

And retailers — who have been vocal in the past about needing a single high-def format — are cautiously optimistic now that there seems to be a clear frontrunner.

“My assumption [with Blu-ray] is that the studios have done the due diligence to make sure they are coming to market with the best possible product for the next-generation DVD,” said Gary Arnold, SVP Entertainment at Best Buy. “What appears to be happening is a unification of sorts between the two formats instead of just causing turmoil with the consumer.”

Kevin Cassidy, EVP of retail stores at Tower Records and Video, said he's glad a dominant player has emerged.

“The HD [DVD] camp is defensive, and the Blu-ray camp is confident,” he said. “They, at least, feel confident to address issues from tech, retail and the studios.”

Todd Zaganiacz, owner of Video Zone in South Deerfield, Mass., and head of the National Entertainment Buying Group, a consortium of 100 independent retailers, agreed Blu-ray is looking strong.

“Blu-ray is coming out of the gate with more support than HD [DVD] has at this point,” he noted. “I wouldn't say that HD is dead yet, but it is certainly looking like HD might be a passenger on the Titanic.”

Enhanced interactivity is one of the driving forces behind the Blu-ray format, and some retailers worry Blu-ray would allow studios to directly market product through links and hidden Easter eggs to consumers without retail involvement.

“One of my concerns is that studios be able to develop relationships with the consumer without elbowing out the retailer,” Cassidy said.

He appreciated Blu-ray requesting retail input regarding that issue and others during sessions at the Video Software Dealers Association's summer confab in Las Vegas.

“I think Blu-ray recognizes our concerns,” Cassidy said. “Or at least it feels like they do a lot better than HD DVD.”

Retailers have other concerns as well. Many say backward compatibility with DVD is important.

“It's all about dual format,” said George Lewis, president of Hollywood Express in Cambridge, Mass. “The existing DVD has to be somewhere on the new format. It doesn't matter who does it, but it's a must-have feature.”

Cassidy said it is imperative the new format be marketed to consumers as a premium — not commodity — product.

“It is important that there not be a race to the bottom regarding pricing as occurred with DVD,” he said. “We need a format the consumer can recognize as a value-add.”

Value-add or not, some retailers think high-def discs will be much harder to sell than was DVD when that format debuted.

Tom Hannah, owner of Video Quest in Joliet, Ill., noted new high-def discs will not have DVD's price advantage over rental-priced VHS, he noted.

“Seeing how the DVD Audio discs failed to catch on might be a better indication of how the market will respond [to high-def discs],” Hannah warned.

Zaganiacz agreed high-def adoption will not be easy.

“The average consumer, happy with DVD, will not run right out and buy a high-def setup because someone says it's better,”Zaganiacz said. “It's not going to be as easy getting a DVD owner into high def as opposed to a VHS owner into DVD.”

Brian Hill, owner of independent Friendly Video, in Pace, Fla., said he doesn't care which format prevails as long as it jumpstarts consumer excitement.

“I just wish something would regenerate some interest,” he said.

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