DVD sales eroding thanks to HD DVD / Blu-ray emergence
By Darren Murph 
posted Jun 24th 2007 4:48AM
posted Jun 24th 2007 4:48AM
You could probably see this one coming a mile or two away, but analysts are now suggesting that 2007 DVD sales will be "flat compared to the year prior, at best," and it's (mostly) due to HD DVD and Blu-ray. It was also noted that the less than spectacular DVD sales could also be attributed to the saturation of DVD hardware in American homes, insinuating that far fewer families are dashing out to snap up new titles for their shiny new players. More interesting, however, was the realization that consumers are jumping ship from vanilla DVDs to high-definition films far slower than the VHS-to-DVD transition, but it's not like having two similar formats to choose from is really helping the general public to decide. Still, it's not surprising to see DVD sales begin to slide as it reaches maturity in the market, but only time will tell if HD flicks will pick up the slack.
Cool :) But it should be DVD and its sidekick HD_DVD sales are eroding thanks to Blu-ray :)
Go Blu!
They are.. Blu-ray just sold 5:1 over HD-DVD! This was during the month Toshiba and the other cut prices on HD-DVD hardware too! Go Blu!
Yes Sony has saved Blu-Ray while simultaneously destroying the PS3.
Jon, please explain.
I'm going on the Logic that the inclusion of Blu-Ray into the PS3 has allowed for Blu-Ray to have way more units in the wild than HD-DVD...big plus for the Blu-Ray format.
On the flipside...Blu-Ray has made an otherwise "sure bet" gaming system, unafordable for most people. $600 is just too much money to spend on a gaming console. This has caused many to stay clear and look elsewhere. When consumers look elswhere...so do game publishers who are choosing the Xbox 360 as a platform more often than not and Sony is loosing more and more exclusives to the 360. Sales in Japan are absolutely abismal while sales in the US have been slow as well.
I for one have started buying fewer DVDs, especially new releases, choosing instead to hold off and get the HD version instead. Of course, I'm holding off on buying an HD version because I don't want to pick sides just yet, which means the format war is causing studios to not get any of my money.
Oh, and by the way, why would anyone root for Blu-ray in the format war? The lack of region encoding in the HD-DVD format means HD-DVD is better for consumers. HD-DVD also has a better catalog. Just my $.02.
Oh, the region coding? And what about all the other cool things Blu-ray have while hd-dvd does not like double the space for higher bitrate resulting in better image and sound quality and faster access speed. Compare the specs. Blu-ray is better than hd dvd in every way, in the tech support and the available movies (maybe because all except one studios release for BD while there is only one exclusive for hd dvd)
Many Blu-ray discs are not region coded.
I don't think we'll ever get to the point when HD-DVD/Bluray sales exceed DVD. I think the increase of downloadable/streaming content via hardware like Apple TV will prevent that from happening. Essentially, we will become a removable medialess market before the high def discs can get the chance to surpass dvd's, which was 10 years for the VHS-DVD conversion.
Dave as you sit on your couch in your cheerleader outfit (nice skirt!) come back to reality - BluRay discs don't look better than HD DVD, and many of them don't sound as good (oops the Blu Ray release didn't get TrueHD). Neither format has a distinct advantage over the other for movies, just differences in content and features. Both formats have movies poorly mastered. Well there is that BD+ thing I guess...
@ Dave
"Blu-ray is better than hd dvd in every way"
And the failure to make Dolby Digital Plus, True HD, or any of the most advanced HD audio codecs mandatory for every Blu-ray player makes that better than HD DVD how?
Are you happy with the fact that Blu-ray is releasing titles that include a run-of-the-mill Dolby Digital 5.1 (Standard for DVD) audio track on your "Next-Gen" release?
Personally I'm not and that's why I've chosen HD DVD over the "superior" format.
So no, you're horribly wrong when you blindly tout the superiority of your inferior format.
HD DVD has maintained the standards that were implemented in every player since their inception. This stability and security that is guaranteed when you pick up an HD DVD player is reason enough to ditch your Blu-ray player as soon as you can before your beloved Blu-ray developers drop BD-Live on you (Blu-ray's answer to HD DVD's HDi and interactive features) and render your current players obsolete. No firmware will be able to save you from the absent hardware that is required to enjoy the features BD-Live promises. What is it that you're missing? An ethernet port, and there has yet to be any word whether or not the PS3 will support BD-Live, so Blu-ray's trojan horse might be crippled indefinitely.
I think Bryan is correct, especially when you consider how overpriced the discs from the two HD formats are! Not only overpriced, but MOST offer LESS EXTRAS than the standard special-edition DVDs (are you listening Blu-ray?)
Until the discs get down to a real price of $10 to $15 [and no more!], I'm primarly a renter of both HD DVD (Toshiba) and Blu-ray (PS3). And with recent reports like "Is Blu-ray disc coating starting to 'ROT'?", I'm definitely not buying any more Blu-ray for the present time.
As for the studios, not just Universal exclusively supports HD DVD. Another exclusive HD DVD supporter is GENIUS Products [The Weinstein Company distributed titles], and next month brings the first HD DVD exclusive release from FIRST LOOK STUDIOS. Also, RHINO HOME VIDEO for now is only releasing in HD-DVD ["Cream - Live at the Royal Albert Hall"].
And, for fishing fans, it was announced in Video Business recently that a new "Fishing" high-definition video [about fly-fishing etc] is forthcoming, and the company is only releasing it in HD DVD.
And many North American Blu-ray "exclusive" titles are available thru import from overseas thru UK, Japan, German and French releases [see the various Amazon foreign websites, or buy from USA dealer xploitedcinema.com]
So take than Blu-ray! :-)
I think its funny to hear anyone say that downloadable content will take over before BD takes over.
Do realize that there are 90m homes with T.V.s in them just in the U.S.? There are 138 million Cable/Sat subscribers in N/A.. Take into account that a Chepo brand like Funai has 52% of all DVD player/recorder sales in N/A and you have the reason why Downloads will be at least another DECADE before they take over packaged movie media. Non tech/internet people want a $50-$150 player with $5-$10-$20 movies. NOT a $700+ Cpu to decode HD media, then $5-$10-$20 to buy downloads. Then more HDD space to BUY when you want to BUY more movies.
When an HDHTPC(a good one) that will hook up to your T.V. with HDMI, that will store over 500 HD movies on it, with interactive content, with a price tage of around $200, will you start to see the end of packaged movie media. CD's still count for around 65% of music sales and look how long good quality music downloads have been around. Plus music doesn’t have the interactive media to fall back on like movies do. Pirates 1 and 2 have almost 200gigs of Data between them. That is a TON of space; if you didn't already know that.
The 'rot' story is overblown. It happened to CDs, DVDs and LaserDiscs. Didn't stop anyone from buying them, did it? Because the problems are not systemic and dealt with quickly.
"As for the studios, not just Universal exclusively supports HD DVD. Another exclusive HD DVD supporter is GENIUS Products [The Weinstein Company distributed titles]"
The PS3 game Stranglehold is also being bundled with John Woo's Hard Boiled for Blu-ray, courtesy of Weinstein/Genius. (Weinstein never pledged exclusivity either)
Ok, I'll see your FIRST LOOK/RHINO exclusives and raise you STARZ (ANCHOR BAY) - which is now Blu-ray exclusive. (Masters of Horror, Halloween, the Evil Dead trilogy, Hellraiser, Bad Taste, The Hills Have Eyes, Phantasm, Day of the Dead, Dawn of the Dead, and so on and so on)
"And many North American Blu-ray 'exclusive' titles are available thru import from overseas thru UK, Japan, German and French releases [see the various Amazon foreign websites, or buy from USA dealer xploitedcinema.com]"
That's a two way street, for example, Cinderella Man, a Universal title, is available on Blu-ray in Japan.
"So take than Blu-ray! :-)"
It's taking it well :-)
it doesnt have to take over.... but it will take a portion of the market and thats what people are saying. when dvd came about there was nothing else to get movies on. thats not the case anymore and for anybody to think its not going to affect dvd sales some is in for a rude awakening.
and i think we are only scratching the surface of the downloadable market. just look at what itunes is doing in the music dept. it has a 10% of the TOTAL music marketshare (walmart is tops with 15%). and i expect itv to eventually make the move to HD movies downloaded to the itv which is a tv device. And thats not even counting we already have a real service out there with the live video marketplace. its an excellent service and since you have a 360 at your tv already (those that have a 360) there is no need for a computer and the quality really is very good.
But I think more than anything this shows that people arent going to buy movies as much the next gen. I really see the rent model taking more and more of the pie esp with the services like netflix and blockbuster online gaining more and more traction.
Why do people think downloadable will EVER take over?
I just bought a movie on disc. I enjoyed it and gave it to my brother to enjoy. I own the disc.
What... Praytell will I do with a downloadable? Burn a disc of it and then give it out?
Have you tried Vongo? My brother and I both have.. so Instead of giving him a DVD (which he will most likely think he bought himself 2 months down the road when I ask for it back). I just say.. Check out [insert movie] on Vongo.. it was really good.
We may be early adopters.. but, I really think download will start taking hold.
@MadRat - I have to agree with you. I read the remarks on d/l'ing films and think "it's just not that simple, nor practical." I was looking at it on XBOX Live and I think I would have 24 hrs to watch the movie. That's no different than Comcast on-Demand, but a lot slower. So, I don't think, at this point, downloading films is an issue.
Sony's financials are a different story ($1 Billion loss last year, down about $900 million this year, stock price issues). Also, I think the region coding is very salient. As a military member, I didn't buy DVDs in Kuwait because many weren't for our region.
I do have HD-DVD. It works very well. I realize Blu-Ray has a larger storage capacity, but the java issues and potential disk-rot are a little disconcerting. Plus Toshia, HP and Microsoft have plenty of money to keep the format going. I just wish Microsoft would jump in and land a deathblow to Blu-Ray to end the argument. Than we could talk about iPhone (just kidding).
I like owning the media. Also... Its not natural for me to tell my brother "Go get Vonga I'm not letting you borrow my disc".
** The whole point is that I want to share something "positive" that I own with my brother.
If I just wanted him to watch it I'd tell him to go rent it himself at Netflix.
I used to buy everything. I have a collection of over 200 dvds (and about 100 VHS). Then comes Blu-ray/HD-DVD... Not only is there no end to this war (I don't care what the article says.. HD-DVD still has a chance to win even if it is a long shot), but there is no reason to watch a movie over and over again.
So, to show off my new system in the VHS days I bought Twister and Independence Day (and 100's more). Then off to DVD's (Had to have the expensive Star Wars collection) and many more movies I just never watch more than once.
Now HD-DVD's came along.. and I have been ignorantly buying those.
Enough is enough... I don't watch and will not watch this expensive crap. Netflix/Peerflix is about the only end to this (Except you get more crap with crap on Peerflix).
Not to mention, every time I loan a DVD out.. I have to become a debt collector to get it back.
So, in summary... don't waste your money on this crap. Use Netflix, Peerflix, or Vongo. That way you don't have to worry about who wins the format war.
i agree moff... when i loan flicks out i am lucky to get them back inside of 3 weeks. i tell my friends to go rent it themselves and the download services can be even better that this because (using xbox live marketplace as an example) but i could send my friend a message to go rent X movie and he goes and gets it.
Okay so on one hand Blockbuster going BD only in a lot of their stores is nothing, but you are saying that you would rather rent movies. See the hypocrisy. Blockbuster still made $5.2 billion dollars to Netflix’s $938mill last year. So they are certainly doing alright. This also means that about 4x as many people get their movies from a rental store as from Netflix.
I'm not saying that Downloads won't play a part in the Future of Movie Distribution, I never said that. However, to think that Downloads will replace movies anytime soon is crazy. Especially, when we are just getting into the HD era and new movies do come out. It still takes most people 10h+ to download 30gigs. So what about a 45 gig movie? It will take this long for at least 3 or 4 more years too. There is no way that will beat a $10 movie from a $100 player. On a $399 LCD from Wal-Mart. Especially when they can just grab that $5-$10 movie when they go on their usual shopping trip to Wal-Mart. Or stop buy the local Blockbuster, ect.. with their date and grab a movie to go home with on a cold winter night. Quick and easy and cheap that’s what people want. Next year players will be $100 and movies will be $10. That’s what you have got to remember. Like I said before CD's still make up 65%+ of the TOTAL music sales, and good quality Mp3's have been around for almost 10 years now. HD movies are the studios answer to Digital Downloads. Just wait till 1440p and so on start hitting, and BD 100 start being used…. However all SD content will be replaced with digital downloads some day, and I do agree this has a big part to do with DVD sales.
1st remember that in order to even need to get one of the next gen formats hdtv is pretty much a requirement. the difference when dvd was around is you still got many of the benefits w/o needing a new tv. thats not the case anymore and will greatly reduce the adoption rates.
and those getting cheap lcd tv's wont care if the content isnt the highest possible. i dont think you will see downloads go above 720p anytime soon and they really dont need to. take the live marketplace in that they have all 720p content with lower bitrates and the general consumer will say it looks a hell of a lot better than dvd (which it does) and really compares much better with hd-dvd/bluray than it should.
I still say you will see sub 10 gig movies for download and they will look very good. And that is easily downloadable. For example I have a 4mbit cable line (not great but pretty good). And I was able to download blood diamond off the live marketplace in 4hrs (7 gig file). And it was ready to play before that but to get 100% of the file downloaded took right at 4 hrs. thats not bad at all imo.
And I will say it now... players will not be under 100 and discs under 10 next year.... its atleast 3 or 4 yrs off.
You also have to remember that blockbuster has stores all across the country which costs a lot more on their end than Netflix's business model.
I'm too lazy to look at total operating costs to do the math though.
I disagree that HD DVD and Blu-Ray are the primary reason why less DVDs are being sold. I think the public is tired of buying movies all the time. For what purpose? To rival Blockbuster? Part of the problem was releasing the same movie over and over again in different editions. UGH! I stopped buying DVDs months ago, and now exclusively rent from Netflix or watch movies via cable.
I still don't know anyone who has bought a Blu-Ray or HD DVD movie.
I'm done purchasing movies outright, no matter what the format.
Arron- It took you 4 hours to download a 7 gig file. That is pretty good for that much data. If everyone was trying to download that much data you local isp's backbone would be having issues.
I can drive to a blockbuster in the next city from mine, pick up the disk, drive back and be done with it before you watch your movie AND I can watch 2 movies in the same evening.
It's great if you live in a remote place but it doesn't hold a candle to going to a store.
n2-
Quite frankly blueray and HD-dvd disks are approaching having all of the information in a theatrical film print. They look so much better than vhs,LD and DVD, that there is value in seeing close to what you could have seen in the theatre. The difference in greater than vhs to dvd.
joe, and i dont think they are eyeing the store rental model. its more about blockbuster online & netflix. and it can be faster than those services where you have to wait 2-3 days to get a movie back from them.
but the other thing that will help the service when they start going netflix model is since you can have 2-3 movies at a time you could theoretically always have 2 movies on your device largely negating the store speed advantage. And this would be done by some sort of queue system where when you watch one movie and delete it your online device automatically starts downloading the next movie.
The Blu-Ray/HD DVD war is effectively all over bar the shouting. Many had predicted that the death knell would come on the run up to Christmas 2007 when the PS3 will significantly ramp up sales in North America, Europe and the other western economies. A lot of people have invested in flat screens and are continuing to do so and will be easily persuaded to go with a disk player with HD capabilities (Blu-Ray). Much as we would all like it to be otherwise the contemporary DSL etc connections to homes throughout the US and Europe are incapable of supporting massive simultaneous downloads of large HD movie files. Blu-Ray will gain an initial hold quite quickly of the primary television in the home to be followed a number of years later by the secondary televisions. It is debatable whether or not these televisions will be HD or not but the proliferation of content could mean that a lot of these secondary players will be used to downscale to SD as many people use older televisions in children’s bedrooms, kitchens etc. DVD took some time to make it to secondary televisions and has only quite recently displaced VHS. Unless there is a major disruptive intervention this war has been all but won no matter what fantasies and spin appear in these forums. If it hasn’t already happened by then Christmas 2007 will bring about the end game once and for all.
I read somewhere that Warner and Paramount see more than 40% higher sales as a result of being format neutral. I wonder how long it will be before other studios realize what they're missing. The war will be won on price. The average consumer needs something to showcase his/her shiny new HDTVs; a $299 HD DVD player with offerings from three huge studios is more than sufficient, especially considering older DVDs will be given new life via the wonders of upscaling.
Once people realize that, say, 1080i source material is enough for their 1080p set, or that they're more interested in the vast selection of classic films from Universal (the largest studio with some of the best non-CGI films ever made), Warner and Paramount (and don't forget HBO), in addition to HD DVD-only shows like "Heroes" (I dare anyone to tell me that the target demographic for this show is not your PS3/Spider-Man/Pirates contingent and that they're not interested), we'll hear more stories of "DVD sales eroding."
Should I even mention that the mere presence of two next-gen formats has driven prices way down from a year ago? Last time I checked, competition was a good thing for consumers and the market in general, but you smart folks already knew that. :)
Am I the only one to notice that VHS to DVD was a MUCH larger picture and sound quality jump than DVD to Hddvd/blu?
Everyone had a 27" tv, and the jump was TREMENDOUS. Now, a very small market segment has a TV in the 42" range, and the difference is noticeable, but not jaw dropping like VHS to DVD. I have a 50", and it's still not the same.
I challenge you to try it sometime. Play a VHS of some movie, then play the DVD, then the HD/blu disc. Then consider that 90% of the population is doing this on a 27" tv, and you'll see why the adoption is much slower.
If you can't see a jaw dropping difference on a 50" set, don't blame the HD format. If you are saying that most people have low-end HDTVs, you might have a point -- there's a lot of junk out there.
But you could also say that folks with a junky NTSC set didn't see much difference going from VHS to DVD. And in fact they rather disliked all the letterboxing. What did they do? They either stuck with VHS or got a better television.
If one is comparing, say, DirecTV HBO with DVD, the differnece isn't the same as with true HD DVD. Heck, even DirecTV HDNet is better than HBO. Some of the stuff they've been showing IS jaw dropping. Check out "Charade", now playing.
lol some of you hd-dvd fanboys are clueless. I haven't taken a side yet but the writing is on the wall .. From movie houses to hardware manufacturers the support is there for Blu-ray. HD-DVD lowers the hardware prices ridiculous amounts yet Blu-ray outsells 5:1.
As for the PS3 comments, give it time it'll surpass the 360 and all it's xbots. The PS3 is selling very well in comparison to the 360 per quarter since it's launch. All this while the 360 was first out of the gate AND considering the PS3s negatively marketed price point. I say negatively marketed because the PS3 is actually a BETTER deal dollar for dollar then the 360.
The ONLY reason Fox & MGM are blu-exclusive is because they are copy-protection fanatics. So much so that they've stopped publishing ANYTHING until BD makes their copy protection stronger.
So, supporting blu-ray = supporting fanatical DRM and region coding.
HD DVD has no region codes and minimal copy protection. If you are pro-consumer, it's the only choice.
Once Walmart backs HD-DVD (and it will be very soon), Blu-Ray will be over.
Actually, the only thing keeping Blu-Ray alive is the VASTLY underperforming PS3.
Kevin Murphy- It's become my personal crusade to point out the stupidity of commenst like yours.
Both HD-DVD and Blueray support copy protection. They both do NOT trust you and restrict your ability to use disks. By using any DRM they have legal tools to sue people who make dvd rippers into life long jail terms and eternal poverty.
The additional copy protection on blueray may take a few more months to get cracked, and that is only if hackers don't try very hard.
Your argument is stupid. It's like saying that your one of your neighbors doesn't mind you going into his house because you can jimmy his door lock with a credit card. Then you cop an attitude with the neighbor who uses a slightly better door lock. Let me clue you in neither group wants you to have access, they put locks on the doors and didn't give you a key.
If the ps3 can't outsell the gamecube, how is it going to catch the 360?
Woops, misread the chart. its the GBA not gamecube.
"The PS3 is selling very well in comparison to the 360 per quarter since it's launch."
The PS3 is selling rather poorly everywhere, and is outsold on the montly basis by the 360, Wii, and even it's older sibling, the PS2. Three months after release, it went from low hundred of thousands of units sold a month to tens of thousands of units sold a month (as of April 2007). If you look at the first six months it was offered in the US, it has the least amount of sales compared to the first six months the Xbox, 360, Wii, DS, Gamecube, PS2, and PSP were offered.
The PS3's biggest claim is that it's the most popular Blu-Ray player sold today, with approximately 3.5 million units worldwide. The Wii and 360 have outsold it worldwide by a margin of 3 to 4 times that number.
I accept Andy's point that there isn’t quite the same jump in quality from SD DVD to either of the two HD DVD formats than there was from VHS to DVD. However there are an awful lot of HD flat TVs out there and many more to come and this in itself will be a big driver for take up. Also as HD broadcasts proliferate people will seek matching and better quality from their home players. Furthermore as studios learn how to optimise the encoding and the players improve the apparent differences will be more enhanced.
The cheap HD DVD player in Walmart soon story has been scotched long ago by both Walmart and the supposed supplier. There is a cheap player on the way this Autumn and it is a Blu-Ray player from Funai. This format war is all over bar the shouting unless there is a major disruptive event no matter how many fantasies are discussed here.
The format war won't be over until Universal supports Bluray (or the other BD exclusive studios support HDDVD). If you think it's going to happen in 2007, you also still think that 80k/month sales for 3 months of the ps3 outsold the ps2 or xbox or xbox 360 over the same period during their launches (clue- those consoles sold far better).
Do you think that Funai player will outsell the ps3? Why would someone buy it instead of a ps3, especially if the ps3 drops in price by $100?
h0mi-
Well as far as I know the GBA was one of the best selling game devices ever. I think that they sell for around $50-60 new and have the extremelly popular pokemon software on them.
I guess you can say, how the XBOX360 be a success when it can't even beat the dreamcast.
Even better you can say how can the combined sales of the xbox360,Wii and PS3 succeed when they all together haven't sold more units than the PSP has.
I'm pretty damn sure the ps3 is the best selling BD player right now. The blockbuster announcement helped some people decide on a HD -format. A $100-200 funai player will help BD out.
The longer universal hold out the less relevant they become. It will behoove them to switch before it's a forgone conclusion that the format war is over. Investors don't like a lack of forethought.
"Well as far as I know the GBA was one of the best selling game devices ever. I think that they sell for around $50-60 new and have the extremelly popular pokemon software on them."
I wasn't referring to lifetime sales but last month's sales. The GBA outsold the ps3 last month. That's not a good sign.
Well, part of the PS3 VS XBOX360 equation is that Mircosoft Doesn't support it's last player, the XBOX, whereas Sony still supports its last player.
There are no new titles coming out for Xbox anytime soon, I think 3 were planned for this year by 3rd parties, and that's all ever.
Sony and others still make PS2 games and one could argue that slows the sales of PS3 units.
MS doesn't have that problem, they stopped major releases on the Xbox last year, Upgrade to the 360 or get no new content, a Very MS approach.
PS2 has like 12+ games coming out by the end of August alone.
XBOX customer "Damn I need to buy a 360"
PS2 customer "What game will I buy this month?"
Bluray & HD-DVD are out of date. Neither will get to critical mass as the market is becoming very very fragmented.
(1) Streaming
The reality is people are downloading more & more and large media and Telecommunications companies are developing attractive streaming services. I would say this delivery mechanism is already begger than either formats and is growing much faster.
(2) DVD upscaled
A good proportion of the market isnt buying any new technology. The reality is that most movies look fine on DVD and people have a big library that they already own and share with their freinds. Upscale technology is extending the quality to the point most people dont care about HD for the magority of films.
(3) SD-Memory
The growth now is not so much in high def but in access to low def films & video clips. IE: movies being played on portable devices and everyone is saving to hard drives and using cheap, fast, reliable SD Memory. I have about 50 movies for my GP2X hand held stored on Imation 2GB & 4GB SD cards. My portable pocket drive is 120GB and I have a mix of music, movies and games on it for my trips away.
(4) Hard Drives
Whilst my portable drives are low capacity my home media center has more than 2 Terrabytes of capacity. In a few months Seagate are releasing a cheap 1TB hard drive, so I'll buy two of these and loadup another 500 - 1000 DVD movies and if I need some high def then I'll just save a few of those too!
Whats left?
There will be some consumer spending crumbs maybe for both players - personally, I'd take the HD-DVD because its region free, has more reliable media, and better performing players at the $299 price point. If there is anything that I still need after all of that, I guess I could look at a Bluray but the crumbs will be pretty small by then...