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Studio Reps Say Industry United Behind Blu-ray

17 Jun, 2008 By: Chris Tribbey

CENTURY CITY, Calif. — With the high-def format war over, the studios are still united behind one purpose: the advancement of Blu-ray Disc. Retailers are beefing up Blu-ray displays, studios are experimenting more with BD Live-enabled discs, and the industry is aiming for a giant fourth quarter for high-def.

A sticker advertising the PlayStation 3 on a Warner Home Video product tells you all you need to know.

“It is a unique time,” confirmed Mike Takac, SVP of domestic field sales for Warner Home Video, at the Entertainment Supply Chain Academy June 17.

If success means advertising another company's hardware, so be it. At least for now.

“The studios, because the war is over, will start going it alone a little bit more,” said Marshall Forster, senior EVP of North America for Sony Pictures Home Entertainment.

The studios and Blu-ray have plenty of competition already — satisfaction with DVD, for one.

“We don't want to cannibalize our standard-definition space,” Takac said of the retail space. “It is a dual focus. We have to recognize that the DVD market is huge.”

While DVD is still the studios' No. 1 source of revenue, Forster predicted that Blu-ray would make up half of the sell-through market, “due to the sheer amount of players out there.”

For now, though, the standalone players remain expensive, and cheap upconverting DVD players are being pitched to consumers instead.

“We wish they would go away,” Forster said.

Russ Crupnick, VP and senior industry analyst for The NPD Group, added, “They still don't know the format war is over, so they went with the upconverter with the lower price.”

Blu-ray players without BD Live are also still being sold, possibly adding to consumer confusion. Wal-Mart has introduced the first sub-$300 standalone Blu-ray player. However, it's not BD Live-enabled. Takac said that doesn't matter.

“The public doesn't know the difference,” he said. “And I don't think it's really hurt sales (the lack of a cheaper profile 2.0 players).”

Education apparently is still a problem, one that's solved over time, panelists agreed.

“I think the whole idea of word of mouth, once consumers get it, they're hooked,” Crupnick said. “You've got a huge base of evangelists out there. … Now how do you use that on-the-street evangelism to get people into stores?”

Takac said education in the stores is the place to start.

As for the cost of Blu-ray Discs, he added that consumers would eventually see DVD prices, once the household penetration hits a certain point.

“When DVD hit a penetration rate of 25% for hardware, that's when software got below $20,” Takac said.

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