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Blu-ray Replication Shortfall in Q4?

19 Mar, 2011 By: Chris Tribbey

Some Say BD Replication Could Hit Capacity By Year’s End

Every fourth quarter brings a mad scramble for studio home entertainment divisions and their partner replicators, as top titles and big boxed sets are pushed to retail in time for the holidays.

However, Jim Bottoms, director and co-founder of Futuresource Consulting, says he truly believes the industry is facing a problem for the fourth quarter of 2011: The North American Blu-ray Disc replication infrastructure likely will hit capacity, and studios may have to delay some releases if the industry doesn’t make a significant investment now.

“There were major capacity shortages in Q4 of 2010,” he said, pointing to data showing a 60% year-over-year increase in Blu-ray production in 2010. “People are talking about new investment, but nothing has been approved yet. It needs to happen soon for it to help Q4.”

Bottoms said studio plans for large Blu-ray boxed sets, more Blu-ray combo packs, the hand-packaging requirements for many titles, the demand for PlayStation 3 games, and the year-over-year increase in single-disc Blu-ray releases will combine to strain replication later this year.

“Better efficiency won’t be enough,” he said. “It’s going to take investment by the big three (Sony DADC, Technicolor and Cinram). There are a few replicators here and there they can turn to for overspill, but this is mostly in their hands.”

Sony DADC and Technicolor declined to comment on Bottoms’ concerns, but Cinram CEO Steve Brown said his company agrees with the report.

“Consumer adoption of Blu-ray has been fabulous domestically and internationally,” he said. “In 2010 Cinram had a substantial increase in capacity — a 25% jump from the previous year. We’re fully committed to the format and increasing our capacity in 2011.”

DEG: The Digital Entertainment Group declined to comment on the Futuresource data, as did Warner Home Video, the leader in domestic Blu-ray releases as of March 11, according to The DVD Release Report (419 releases, with Sony Pictures Home Entertainment second at 368).

Andy Parsons, SVP of corporate communications and new product planning for Pioneer and chair of the Blu-ray Disc Association, said he couldn’t agree or disagree with Bottoms’ findings.

“However, I remember very similar concerns being raised about three years ago once it became clear we would have a single high-def format in the market,” he noted. “If these latest concerns pan out, I expect that the industry would rise to the challenge just as it did then.”

Paula Tait, EVP of sales and marketing for replication and packaging company Precise/Full Service Media, agreed that current Blu-ray capacity concerns sound similar to the early days of DVD.

“I will say that I haven’t heard any rumors during the past 12 months where content owners couldn’t get their Blu-ray titles manufactured in a timely manner,” she said. “We have not experienced such a demand for Blu-ray that we weren’t able to meet commitments for delivery.”

About the Author: Chris Tribbey

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