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Sony Prices Blu-ray, Plans Bundling

7 Feb, 2006 By: Thomas K. Arnold

Sony Pictures Home Entertainment today became the first major studio to put a price tag on Blu-ray Discs when they become available in U.S. stores later this year.

At the same time, the studio unveiled what many observers believe will be a key component of the next-generation, high-definition optical disc's marketing strategy — bundling various formats together to give consumers more flexibility and mobility.

Catalog Blu-ray Disc titles will wholesale for $17.95, about the same as DVDs when that format came on the market in 1997. New-release Blu-ray Discs will wholesale for $23.45, a premium of about 15% to 20% over what suppliers were charging for new theatrical DVDs.

Sony Pictures Home Entertainment president Benjamin Feingold said the higher pricing structure for new releases is meant to accommodate both the sellthrough and the rental markets.

He added that Sony will not attach any suggested list prices to its Blu-ray Discs, at least not at this time.

“From the retail perspective, this is going to be a hot product, and retailers will no doubt determine their own margin structure,” he said. “We believe in a free market.”

Blu-ray Discs will likely start showing up in stores by early summer, sources say. In advance of that, Sony is bowing a bundling concept to DVD and the Universal Media Disc (UMD) that it may migrate to Blu-ray.

Starting March 28, consumers can buy DVD-UMD combo packs of The Grudge, Resident Evil, Underworld, Crouching Tiger, Hidden Dragon and MGM's The Terminator for just pennies more than Sony typically charges for a new DVD.

A second batch of DVD-UMD combos — Ghostbusters, Mad Max, The Fifth Element and Snatch — arrives April 25, with a third wave slated to come on the market in May.

Each combo is priced at $28.95. Sony typically charges $24.96 to $26.96 for new DVD releases, while titles new to UMD generally list for $19.95.

Additionally, the Fun With Dick and Jane remake bows on DVD and UMD April 11, with the formats available individually for $28.95 each or bundled together for $39.95.

Feingold said that's a taste of what consumers can expect when Blu-ray Discs appear in stores.

“With the launch of Blu-ray, we're going to try to introduce the managed-copy concept, where if you buy Blu-ray you'll be able to get additional versions [of the same title] to use in your home,” Feingold said. “Ultimately, we might even get to the point where we'll offer consumers the ability to have different versions of the same movie on different devices in the home — that's something we're working on.”

For now, Feingold said, “we're experimenting with UMD,” the tiny optical-disc format playable only on Sony's handheld PlayStation Portable (PSP).

“A lot of people have DVD players and also have PSPs, and this way for one price they can get one movie and play it back on both formats,” Feingold said.

Feingold would not specify whether future Blu-ray bundling would be electronic or physical, as is the case with the DVD/UMD combo packs.

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