Blu-ray Wallops HD DVD In Disc Sales

Despite the introduction of low-cost HD DVD players, Blu-ray disc sales walloped rival HD DVD during Thanksgiving week. That's according to an article by Home Media Magazine.

The publication reports that Blu-ray accounted for 72.6 percent of all high-def discs sold during Thanksgiving week, compared to 27.4 for HD DVD. (The figures are based on data from Nielsen VideoScan.)  Blu-ray, which is led by Sony, has enjoyed a 2-1 sales advantage over HD DVD for months. However, retailers recently began selling Toshiba HD DVD players for under $200 -- roughly $200 less than the lowest-priced Blu-ray player.

In pre-Black Friday sales (weekend of Nov. 16-18), some stores were even selling the Toshiba HD-A2 for just $98. The introduction of the low-cost HD DVD player has led some analysts to speculate that the Toshiba-backed format would finally overcome Blu-ray's advantage. However, during Thanksgiving week, Blu-ray's sales lead actually expanded to roughly 2.5-1.

Of course, HD DVD supporters are likely to say that disc sales will pick up in the next few weeks after people have had a chance to install their new players. Blu-ray and HD DVD are rival formats competing for the new high-def disc audience.

In related news, Home Media reports that consumers spent $176 million on DVD rentals (standard-def and high-def) during Thanksgiving week, which is a 7.6 percent increase from the previous week.

SONY CEO Speaks out on Blu-ray

Sony CEO Howard Stringer affirmed the company's support for and belief in Blu-ray Disc, saying in an exclusive e-mail interview Monday that the Sony-developed next-generation disc format has "the momentum and the scale" to ultimately triumph over rival HD DVD.

A week ago, an Associated Press story quoted the outspoken Sony chief as saying Blu-ray was in a "stalemate" with HD DVD, which is backed by Toshiba and Microsoft. His comments caused a stir in the blogosphere, where they were construed that Sony's resolve to win the next-gen format war might be weakening.

Stringer said that Blu-ray has the exclusive support of Disney and Fox, "who have consistently produced the highest level of boxoffice in recent years," as well as MGM, Lionsgate and Sony. HD DVD is exclusively supported by Universal and Paramount, with Warner Bros. releasing titles in both formats.

"I think Blu-ray is just a better format," Stringer said. "Our partners are with Blu-ray Disc because, first of all, we have greater security, which Fox is particularly good at. Disney thinks it's a better picture. And the sheer amount of bandwidth on the disc gives directors and beyond all kinds of future opportunity, including director's cuts and who knows what 3-D capabilities will be down the road.

"I think that's why Steven Spielberg held out his own product from going to HD DVD," he added. "Ultimately, if you're passionate about movies, which these DVD collectors are, Blu-ray is the best answer. I think that is true, and we see that in the blogging environment.

"It isn't the cheaper format, but it is the better format," Stringer said.

He added that while HD DVD might have made inroads with price cuts on both hardware and software, Blu-ray hardware prices probably won't sink much below $400.

"We haven't announced any price cuts yet, but obviously the PS3 at $399 was a price cut, and that's also a Blu-ray player," he said. "We're comfortable with the situation at the moment."

Stringer also elaborated on the boom in PlayStation 3 sales after Sony cut the price of its 80GB model by $100 and launched a 40GB model. Sony said last week that in the two weeks endingNov. 11, more than 100,000 game consoles were sold; Stringer said he ultimately could see the PS3 becoming as big as the PlayStation 2, the most successful video game machine ever.

"The momentum shift and the energy behind PS3 in time for Christmas is extremely fortuitous," he said. "It was planned by the PlayStation group, but I think this momentum now -- particularly the number of games coming out, including our own as well as third-party -- is the same as it was with PlayStation 2."

Noting that "it takes time to build a new format," Stringer insisted that PS3 is "not behind the curve compared to PlayStation 2 in terms of momentum. The amount of bandwidth and the processing power of Cell give game manufacturers a lot more work to do to use this system to its full benefit -- and it's taken awhile to do it. The same was true of PlayStation 2."

He said Sony was waiting for the $399 price tag "to see if, indeed, the loyal PlayStation customers -- and there are 200 million of them who have PS2 -- (would) kick in, and clearly the value proposition has sent the message."

Blu-ray Camp Claims HD DVD Group Misrepresented Data

The weekly back-and-forth saga between Blu-ray and HD DVD continues! Let’s get you up to speed: Earlier this month, Blu-ray claimed victory citing a K-Mart deal. Last week the HD DVD camp claimed victory with sub-$100 players. Soon after, Sony’s CEO called the battle a stalemate. This week, the Blu-ray camp lashed out at the HD DVD Group claiming a "gross misrepresentation of data." Tune in next week when one of the two camps declares absolute victory…again. roll eyes (sarcastic)

Simonis goes on to claim that the HD DVD Group "manipulated" the data, adding that, "you can see this because they did not even supply access to the original source of their numbers." As if that wasn't enough, he then further slams the HD DVD folks by saying, "Honest to God, the Blu-ray Disc Association would never do this. We've seen so much rubbish come from the HD DVD Group it's unbelievable."

Warner Stays the Course on HD DVD/Blu-ray Disc Support

Reports of Warner picking Blu-ray Disc premature, for now.

Right now, the high-definition optical storage war is waged on the grounds of studio exclusivity. If you want to watch Transformers in high-definition, you’ll need an HD DVD player. If you want to watch Spider-Man 3, you’ll need a Blu-ray Disc player. Due to no fault of either format, but rather the companies backing them, consumers require both machines in order to view the latest home releases in full 1080p glory – unless of course if a given release is available on both formats.

After Paramount and DreamWorks jumped over to exclusively support HD DVD, the last major studio with its feet on both sides of the field is Warner. Releasing major hits such as 300 on HD DVD and Blu-ray Disc, Warner benefits from both early adopter markets. Reports from last month’s Blu-ray Disc media event pegged the possible end to Warner neutrality, citing comments from Dan Silverberg, VP of high-definition media for Warner Home Video.

“One thing that may be changing is our strategy,” Silverberg said. “When both formats launched and hardware prices were high, we made a decision to support both formats and let the consumer decide. But now that hardware pricing is affordable for both Blu-ray and HD DVD, it appears consumers no longer want to decide — so the notion of staying in two formats for the duration is something we are re-evaluating now that we are in the fourth quarter.”

Given that Silverberg’s comments took place a Blu-ray Disc event, those within an earshot of the VP would likely have been ecstatic when he said, “We can definitely talk Blu-ray... We are committed to the format.”

Internet forums dedicated to the debate over the two high-definition formats went into a frenzy following Silverberg’s hint that Warner may be leaning towards exclusive Blu-ray Disc support. After days of silence, however, Warner Home Video told High-Def Digest that the comments recorded by Home Media Magazine are “misquoted and misconstrued.”

“I can tell you that Warner's position has not changed, and I know that Dan did not intend to suggest that wasn't the case,” said Jim Noonan, SVP of Strategic Promotion and Communication for Warner Home Entertainment Group. “We support both formats and we have made no decision to alter that policy, nor are there any such announcements coming, or being planned.”

From a business standpoint, Warner right now is enjoying the upside of being able to sell its high-definition movies to both crowds, leaving little incentive to go exclusive. Noonan continued, “Like any major company, we are always reviewing our strategies in every aspect of our business, it is what smart companies do. I can't say what may happen five, ten years down the line. But right now, Warner Bros. has made no decision to change course. We are still onboard with both formats, and will continue [with a strong line-up of new releases and catalog titles], just as we have in the past in supporting HD DVD and Blu-ray.”

Kmart Chooses HD DVD Over Blu-ray Disc

Kmart picks HD DVD over Blu-ray Disc, citing price as the main reason

While the Blu-ray Disc Association is wining and dining members of the media, HD DVD is going after the retailers. It was uncovered last week that Wal-Mart had plans to stock Toshiba’s 1080i-capable HD-A2 HD DVD player in its stores for $198. The move represented a major break-through for the high-definition format into the daily path of mainstream consumers.

Wal-Mart wasn’t the only retailer with the idea of stocking an affordable entry-level high-definition movie player. Just days after Wal-Mart’s reveal, big box electronics retailer Circuit City priced the HD-A2 on its website for $197.99. Amazon.com quickly followed suit, also listing the unit at just below $198.

Having the most-affordable HD player on the market is certainly a powerful edge when it comes to consumer preferences, but the HD DVD camp is trying to go a step further by being the only name in the game. Exclusive movie studios, such as Paramount and DreamWorks, are essential in swaying the consumer, but so is retailer exclusivity. Jodi Sally, VP of marketing at Toshiba America Consumer Products, told Home Media Magazine that Kmart would exclusively stock Toshiba HD DVD players in retail stores due to their lower price. Reports from the consumer level confirm the news, with the only high-definition standalone movie players for sale in the electronics department being those from Toshiba.

The Blu-ray Disc camp still had one foot in the door of Kmart, however, as the retailer stocks and sells the PlayStation 3. Kmart also sells the HD DVD add-on for the Xbox 360. Toshiba denies having much to do with the recent price avalanche of entry-level HD DVD player, instead saying that the price drops on HD DVD hardware came from the retailers’ side.

“There was no official move on our MSRP, but I’m happy to see the strong sales momentum on our players,” Sally said. “We experienced a great lift in player sales when Transformers (Paramount) was released, and the strong momentum continues.”

Nevertheless, Toshiba is fully aware of the impact that price has on consumer buying habits. When the HD-A2 dropped to $299 during summer, Sally said, “We know that price is a powerful driver for consumers to adopt new technology.”