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A Forecast for the Industry in 2013

19 Dec, 2012 By: Thomas K. Arnold

With the year rapidly coming to a close, my annual year-end analysis, which will appear on this site shortly, offers all sorts of interesting observations, discussions and dialog from industry leaders on the state of the home entertainment business and how we got here. The story ends with a look ahead, with projections on what 2013 may bring.

In this edition of T.K.’s Take, I’m going to add my voice to the chorus and share some of my own personal thoughts on where our business is heading — along with a handful of obstacles I think we need to fix or at least address, post haste.

I believe the bump in overall consumer spending we saw in 2012 will either lead to another slight uptick in 2013 or level out — but in any case, I don’t see any declines, at least not for a while.

On the physical side, disc prices are low enough that consumers are going to step up buying discs, particularly those who want the best-possible quality of both picture and sound and don’t want to mess with the logistics of downloading or streaming. I know, I know, digital is so easy that watching a movie is just a click away — but for a large percentage of the population, that’s one click too many.

And on the electronic side, the more options consumers have of watching movies, the more likely they will take advantage of those options. That’s why universal support of UltraViolet — the best value-proposition I think I’ve ever heard of — is critical at this juncture. So is studio support of Netflix and Redbox, both of which have proven themselves mighty fine little innovators capable of thinking beyond the physical disc. Stop fighting and make it work — and in the end, we’re all going to benefit.

I also see a return of young eyeballs to the movies. At this point everyone younger than 21 is still enthralled with YouTube and goofy clips and Web series. But inevitably the novelty’s going to wear off and I believe we’re going to see an uptick at the box office — provided, of course, that Hollywood continues to make good movies, as it’s done this fall with titles such as Argo, Skyfall, Flight and Lincoln.

So, yes, I’m feeling quite bullish right now — and yet, there are several areas of concern that could prove flies in the proverbial ointment:

• Pricing. The days of commanding a premium for Blu-ray Discs is over. Consumers need to be able to buy BDs for the same prices as DVDs, even new releases. The message two-tiered pricing sends is that DVDs are inferior and BDs are elite, so too often consumers end up buying neither. In the early days of the format it made sense, but no longer.

• 3D. It’s still too cumbersome and confusing. I have a Panasonic 3D TV, and a 3D Blu-ray player. I tried buying glasses for the TV but the guys at Best Buy gave me the wrong pair; when I went to return them and told them the model of my TV they said they don’t carry those glasses any longer. To top it off, I slipped Pirates of the Caribbean into the BD player and the screen said the player doesn’t recognize it as being 3D. I give up.

• Combo units: Our side of the business has done a great job with combo backs, allowing consumers to get a DVD and a BD in the same pack. Pity the CE industry hasn’t followed suit. I have yet to see a TV with a built-in BD player at Best Buy or Walmart, and am still waiting for a Blu-ray Disc player for my car.

• United we stand. When DVD was launched, not everyone was on board. When BD was launched, we found ourselves in a bitter and divisive format war. Now we’ve got UltraViolet. Can we all get in the same sandbox, for once?

That said, here’s wishing you a merry Christmas, and a happy new year, on behalf of the entire staff of Home Media Magazine.



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