HD DVD Rallies Consumer Audience in 2007 Driving Nearly One Million Dedicated Player Sales in North America

Started by Shane Jan 7, 2008 134 posts
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#1
At the 2008 Consumer Electronics Show in Las Vegas, the companies of the HD DVD Promotional Group recapped a breakthrough year for the high definition format, reaching nearly one million dedicated HD DVD players sold in North America and delivering on the promise of affordability, quality and a consistent experience on every machine. With a leading install base of dedicated players, there are now more than 400 titles available in the US and more than 1,000 titles available worldwide. During the key five week holiday selling period, HD DVD software sales grew at nearly twice the rate of Blu-ray, which was consistent with increased player growth.

As the industry looks for a format that can break into the mainstream consumer market, HD DVD continues...

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#2
Enough with the rhetoric already! It is unlawful for the studios to refuse to license or sell to any disc producer, especially for Warner's admitted purpose of putting HD-DVD out of business. Toshiba: if you don't understand the phrase "Sue the bastards," contact me at [email protected], and I'll be happy to explain it to you.
#3
Please understand that I'm no lawyer. I'm just asking for a little clarification on your comment.

I would assume that Warner has the right to distribute its own product in any way it chooses. If I understand you correctly, you're saying that Warner does not have the right to refuse a third party buying the product and then releasing it in a different format. Do I have that right so far? I would also assume that Warner would not only have to be paid for the intellectual rights to begin with, they'd also be entitled to a percentage of the sales. If this is true, are you saying that Warner has refused to license their product to a third party that intends to sell their product in the HD DVD format?

Henry
#4
You forgot to mention that the HD Consumer Group canceled its news conference there, but perhaps that's not as important as some would make it out to be. Toshiba certainly denies this is the death knell for HD DVD. It would seem to me that the most positive number is the number of titles sold. In February it was 98.71 to every 100 Blu-ray titles sold, much too close to call a winner. And of course the 5 to 1 ratio of Blu-ray to HD DVD players sold is distorted by the popularity of the PS3. And even my own opinion is suspect. I bought a Betamax instead of a VHS machine. Is this payback for seeing an inferior standard adopted in the past? Am I tired of hype succeeding over technical standards? :cry:

Absolutely.

Henry
#5
Henry,

The antitrust laws prevent Warner, or any other producer, from refusing to deal for anti-competitive purposes (which, in effect, Warner has admitted). You are correct that Warner would have to be paid by an HD-DVD producer the functionally same amount it is paid by a BR producer. My invitation was purely rhetorical, I presume that Toshiba has already been extensively briefed on this by its lawyers. There are many reasons why it would hesitate to do battle with the movie studios. I for one would like to encourage them as much as possible; breaking the studios current monopoly powers would ultimately reduce disc prices for everyone.

Phil
#6
On the face of it, reducing the price of a disc is a worthy goal, especially if it resulted in more sales and income for the artists that created the material on the disc. But I wonder if this goal is offset by the cost to the consumer of having to purchase different machines for different products? Perhaps this wouldn't be a problem if it was like buying music on records, cassettes, CDs or DVDs. The difference between this example and video would seem to be only cost. But until the cost comes down, it would seem there is an economic advantage to the consumer in having one machine that can handle videos, games and any other high volume content.

I have no doubt that the march of technology will eventually make this question moot, but until then it would seem to me there is a definite advantage to the consumer in having one standard and one machine for all applications.

Henry
#7
I posted the following in another forum and got 'laughed off the board' but it seems that many here had the same basic idea..
--------------------------------------------------------------------------------

As we know the home video rights for movies are many times sold by the studios to a third party for home video release.

What would prevent such a third party such as "Criterion Collection" or even a new company from purchasing movie rights for release on HD-DVD in the future?

Toshiba use to have a movie releasing division, what would prevent them from recreating this division and purchasing the rights to press HD-DVD's from Warner Bro's or other studios, for retail through like Amazon?

This would leave the studio as backing their "HD" and allow HD-DVD owners to have copies of movies.

--David
#8
The history of competing formats, for example Betamax versus VHS tape, would suggest that content providers don't like multiple formats and tend to only support what they view as the format most acceptable to the public. The recent announcement by Warner to only support Blu-ray seems to confirm that a majority of content providers have made up their mind in this case. Although I wouldn't say what you suggest is impossible, I think it would be extremely unlikely at this point in time. In the case of Betamax versus VHS, for example, the decision was based on perceived public acceptance and not the quality of the recording. Personally, I think the content providers are making the right decision this time because Blu-ray better supports a larger range of applications and is therefore more future proof, a factor I suspect was part of the reasoning that led to their decision.
#9
David,
You are right on the money; but without a lawsuit first, the studios won't permit it.
Henry--there are so many reasons why the beta/vhs analogy is inapplicable. The only thing now preventing HD-DVD from continuing to undercut and outsell BR is a lawsuit.
#10
If you mean this is really all about money, you're right. The studios don't want to support two formats, especially in a possible impending recession. They view the continuing existence of two formats as confusing to the public and having a negative impact on total sales of high definition players. For whatever reason there seems to be the attitude of let's cut to the chase and decide for the public. Toshiba is not happy about this decision because in hardware sales they're doing pretty good right now. Consumers who have already bought HD DVD players are not happy. Microsoft is not happy because of the X-box. The reality here is that there's no solution that can satisfy everyone and, like it or not, ultimately content is king.

Henry
#11
It depends on where you sit. If you are among the 2 million+ who have invested in one side or the other, then the best thing for those consumers is for all studios to distribute In both formats. The only consumers wanting a single format are those who have not yet invested. Sure, there are more consumers that have not invested than those who have ... But you are still alienating a large group of consumers by going to a single format this late in the game.

Bottom line, the solution that makes everyone (the consumers) happy is for all studios to release in both formats.

My opinion.

- Shane
#12
No argument there. I'm just pointing out that the studios are taking a longer view. My guess is they are giving flexibility of the type of content as well as content length a heavy weight in their decision. I don't blame consumers for being angry at the possibility of having the rug pulled out from under them after a substantial financial investment, but they can at least console themselves that the studios are going to save them money in the long run by creating one standard for multiple, and in my view exciting, future-pointing applications.

Henry
#13 (edited Jan 10, 2008)
I am thinking of writing the 'Silent Giant' in the marketing world 'Wal-Mart' about their support of the HD-DVD market or ask about an extended refund policy for the drives sold/purchased in November/December 2007.
If Wal-Mart had to make refunds on the reported 97,000+ drives ($97,000,000.00).... I think that might wake somebody up.... As we all know Wal-Mart has many 'special' DVD packages and I am sure they could do the same thing for HD-DVD.
Just think if somebody like Wal-Mart walked into Warner Bro's and said they would no longer sell their disc's due to no longer supporting HD-DVD?

--David
#14
I don't think anybody's talking about dropping support for existing HD DVD drives for the time being. But I would expect, over the next few years, HD DVD titles would be harder to find as studios gradually put their support behind Blu-ray as the dominant format. I don't think studios would cut off a revenue nose to spite the format face of a HD drive.

Henry
#15
In a posting else where here at HDTVMagz the company "2007 New Medium Enterprises, Inc." 'HD VMD Players' is releaseing a "RED" laser HD-Player and it seems that they have the rights to movies from almost every studio in their movie listing.
So if this company can get the rights to press disc's for their format from Paramount, Warner, and even Sony then why can't a third party do the same with HD-DVD?
#16
The final say to all of this is probably going to be the retailers. It won't matter who's manufacturing HD DVDs if retailers won't devote shelf space to the format. If that happens, it will be increasingly unlikely that the discs will be manufactured. With Universal's commitment to HD DVD exclusivity gone and New Line and HBO switching to to Blu-ray, it's not looking good for HD DVD.

Henry
#17
David,
That sounds very interesting; but where did you see that the major studios were licensing current releases to them?
Phil
#18
Studios already had been releasing titles on two incompatible formats for 20 years! VHS and laserdisc.

And I certainly don't se BR as a "future-proof" format. So far, it still hasn't equalled what HD-DVD offered a year ago. (And won't until Profile 2.0 players are released.) To take advantage, those who already bought BR players will now have to buy another machine! BR is certainly no more future-proof than HD-DVD...it's just is more expensive. I was going to dive in to the HDM club next month. Now...I'll pass.
#19
Blu-ray is more expensive but holds more data. The "future proof" aspect is connected to the amount of data required for applications beyond just movies. This conceivably avoids the expense of buying multiple machines for multiple applications. The idea is that the public is going to want more sophisticated applications that require more memory and the HD DVD memory standard will prove not to be adequate. Right now, this is only true for some PS3 games, but if history serves, the appetite for more memory will only increase in the future.

Henry
#20
Henry,
Unless HD-DVD sues and breaks the studios attempts to create a Blue Ray monopoly-- there will be no future for HD disc media. Blue Ray will always be too expensive for the mass market (think SACD & DVD-A); especially in view of the soon to be competition with Internet high definition downloads. The production costs of a HD-DVD disc is half that of Blue Ray; and the last few months have shown that the public is willing to buy a high definition disc player for $200. If there is to be a future for a high definition disc media, it will only be if the studios are required to license production to all competitors.
#21
Blu-ray is more expensive but holds more data. The "future proof" aspect is connected to the amount of data required for applications beyond just movies. This conceivably avoids the expense of buying multiple machines for multiple applications. The idea is that the public is going to want more sophisticated applications that require more memory and the HD DVD memory standard will prove not to be adequate. Right now, this is only true for some PS3 games, but if history serves, the appetite for more memory will only increase in the future.

Henry

Yes, but HD-DVD also had pending the 51 GB disc (supposedly backward compatible), so that really doesn't apply. If that memory appetite does increase in the future, both formats would be ready. Right now, BD can't even handle the menus (very clunky compared to HD-DVD), IMEs, or even scene bookmarking, that are found on HD-DVD. As an example, compare THE WILD BUNCH on both formats. You'll see what I mean. To me, the BR advantage of "pay more, get less" is not one I subscribe to. If BR ever catches up to what HD-DVD could provide, maybe then I'll reconsider. Till then, there's still plenty of HD movies available (more than are found on both formats combined) through other sources.
#22
There is currently a popular and successful Blu-ray player. It's called a PS3. It sells in quantities five times that of HD DVD players. I doubt if hi-def internet content will be very popular in the near future because most people don't have internet connections to make it practical. But I agree it will be great when that day comes. I don't agree that content providers should be forced to provide their content on a specific platform. That would violate the very spirit of free enterprise in which commerce is regulated by competition, not government controls.

Henry
#23
Henry,

You sound like some politicians. The anti-trust laws were enacted to protect competition from restraints of trade such as refusals to deal for anti-competitive purposes. Free enterprise can only thrive when the anti-trust laws are vigorously enforced. Warner's stated intent to put HD-DVD out of business, is pretty clearly unlawful; and hopefully will be the beginning of the end the studios attempts to restrain competition.

Phil
#24
David,
That sounds very interesting; but where did you see that the major studios were licensing current releases to them?
Phil

I just depends on what you want to call "Current".... I have purchased many 'older' movies due to them being new to the format.. would you call "Casablanca" or "Robin Hood" a current release when it was released on HD-DVD??

From a number of press releases from this new HD Format and looking at their web site, it seems that Mel Gibson's "Icon" productions have signed a 'worldwide' deal for all their movies to be released on this new format.

Now If "Icon" can do that for the new 'VM-HD-Disc' why can't "Toshiba" or a third party do the same with HD-DVD?

Also it seems that 'Radio Shack' will be selling this new format as early as 02/01/08

--David

[So it seems that while "Blu" was beating up "HD-DVD" somebody else might of taken another route in this race, side note: I don't go to the 'Blu' forums and tell the owners of their machines they made a mistake.. but it seems that many 'Blu' owners go to HD-DVD forums and try to tell HD-DVD owner that they did.]
#25
I would like to add a perspective to the wonderful BluRay capacity. Capacity of a disc is not Memory. Not in common parlance. HD DVD in fact had specified and has more memory (RAM in the player) than BluRay. And thus performs feats BluRay dreams of.

Capacity of the disc...well it's probably pointless to point out HD DVD would have soon been equivalent, but having a bigger bag, doesn't mean more was put in it. And I have never been convinced that BR did any better, in any way with 50g over HDDVD's 30g.

And, neither have they with their bit rate. I think some people claim that BR is a better picture, but I have only HD DVD right now, and can not test that. I would hope BR would make use of it at some time.

But, this is all rhetorical. I think downloads will fairly quickly take what is still a niche market and put it in the corner with SACD/DVD-A (which I love to death - but don't have a single friend to share it with!). I will probably also go BR - I actually occasionally watch some of the extras and like the possession aspect of my movies. But I expect to get over that as my next child goes to college.
#26
. I think some people claim that BR is a better picture, but I have only HD DVD right now, and can not test that. I would hope BR would make use of it at some time..

I've compared both for PQ (using stand-alone players) and I have NEVER seen a BR disc with a better picture than HD-DVD. In fact, it's usually been the opposite,with HD-DVD providing the better, sharper, more detailed PQ. (HARRY POTTER being the most recent example.) And anyone who has stood next to me during the side-by-sides has noted the same. Yes, I know it is said that since they use the same encodes, there should be no difference...but there is, no matter what anyone says. In fact, I've seen cable HD broadcasts (such as CASINO ROYALE and EVIL DEAD II) which had better PQ than the respective BR discs. So personally, I see no sense in spending hundreds on a format that is still a "work-in-progress" (at best) and offers less. If BR is the only option, I may just sidestep the entire HDM format. BR has never truly delivered, right from when it was first introduced. Although it has improved since then, it didn't beat HD-DVD performance-wise and the improvements eren't nearly enough to justify the price-tag.
#27
I've compared both for PQ (using stand-alone players) and I have NEVER seen a BR disc with a better picture than HD-DVD. In fact, it's usually been the opposite,with HD-DVD providing the better, sharper, more detailed PQ.


What players did you compare at what scan rate, with what display and what titles?
#28
Richard, you are asking for a lot of qualification - a tough assignment - even if valid. But, in aggreement with you...my understanding is that BR for the most part uses the same encoders as HD DVD, and I am going to assume you are leading into that given apple and apples, BR will look equally as good as HD DVD given any pair of same sourced (assuming both mastered with the same encodiing) content. And I have read that, and I believe it - qualified by the concept that the players do equally good jobs of processing the data through their hardware and getting it to the HDMI port. I have no reason to believe the vendors of BR are not equally as ernest about delivering the same quality. In the end, there are just so many variables, I find it all overhwhelming to try and be absolute.

What I am saying in my previous posts, is that I don't know that BR has taken advantage of their capacity. I am not sure that their data capacity and data rates have practically been used to make for an improved picture and audio, though I absolutely believe it could.
#29
Both are supposed to be able to provide native bit streams directly off the disc without being touched in any way via HDMI provided the player has been designed for those features. That requires a 1080p24 capable display that allows 1:1 pixel mapping and an HD audio bit stream capable receiver. You covered the other gotya's... source, codecs, ect..

They are capable of delivering the same final product from the same data.
#30
A decision to support one of the two competing formats is required if retailers are to serious take note of the genre and support it on the showroom floor with unhesitating enthusiasm.

Here is what I have learned from the retails. First, a confused customer (leave early adopters out of this) will not spend when still confused. Consumers wait for the confusion to end and until then make do with an existing standard--in this case standard DVD. Those who are anticipating a resolution to the confusion may even forestall adding new titles to their old standard library. The studios blamed the 3.5% decline in total DVD sales in 2007 on this troubling format confusion. There is no stopping enthusiast, of course, from seeking and buying the latest state-of-the-art gadget regardless of its market support, its technical basis, or the prevailing market trends. Early adopters (that's us, isn't it?) will (did) buy one or both of the high def DVD formats well before a market choice was made and did so at our own risk. The early adopter markets are absolutely essential for establishing a product category but such a limited market is not the one in which the motion picture, manufacturing and retail industries most covet. They take early adopters for granted (because we always do the same thing no mstter how we are treated) and seek all avenues to the enormous commodity/consumer markets which show up at retail after all early-market troubles have been resolved. To some degree we saw this same thing occurring with the early ATSC decoders, which had high prices and questionable performance at the start. Those things slowed the growth of the HDTV market so much so that HD was charged in the press as being "stalled". Now, after commoditizing of these tuners and building up a good-enough technical reputation they are included (even mandated) in the least costly receivers.

Second, a retail salesman will not knowingly lead a customer to an unresolved industry-wide confusion when no response they can legitimately make to a customer's question can resolve that confusion. A regular customer, we have all learned over the years, will not voluntarily buy something while remaining confused over the main choices. If no clear direction is made by the marketplace (I include government, manufacturers, retailers, content providers and consumers as components of the marketplace) the bulk of the sought after market will wait on the sidelines. The confusion can also spill over to infect the sale of other things, such as what kind of display to buy.

Manufacturing is the sector that benefits most from having one standard or format dominating. No one should be left doubting that economies of scale play a crucial role in the final outcome of any product. If that product has vast appeal, then the cost for each physical component in the category is subject to very critical review/analysis by many competing mass production engineering specialist. New techniques for making things come as often as not from an eagerness of these huge manufacturing facilities to successfully serve the emerging commodity markets. All of us benefit from this fact. I have heard (and even made the criticism myself) that by selecting one standard or format some potential innovation is stiffled for the entire category. The reality is that many years of competing ideas finally gel into well-delineated standards and a standard is the best thing we can hope to have in consumer electronics, if, that is, low price has anything to do with our desires. You cannot economically manage if thousands of little standards are forever spinning out of the present state-of-the-art development and begging for attention in the markets. (software evolution can be an near-exception) A constant evolution forward is, of course, theoretically possible since the "state-of-the-art" never stops evolving towards perfection. But you have to come to a point as a public servant when good enough is just that--good enough. The then president of the David Sarnoff Research Center, Dr. James Carnes, clarified this fact-of life to my readers several years ago when he said about the ATSC standards work, "There comes a time when you have to shoot the engineers and take what they have done to market as it is."

What has occurred in this highly visible contest of wills is that "well informed" early adopters (defined by making an early appearance in the marketplace) shot the dice, and many shot it twice by buying both formats. I would like to see a survey of all high definition DVD owners to know what percentage of them own both formats? When I hear numbers like "2 million" will be left orphaned by a decision they made for one or the other I have to ask myself if that represents a clear matrix of the market? I certainly don't know how all people came to buy the format or formats that they did, but I do see from overwhelming evidence that there was ample warnings from the press (often sensationalized) about the format war well in advance of the time when one could buy anything. Who with an interest in HDTV could not have known at the time of their purchase that this contest between competing formats was far from being a settled deal and the wrong choice could be made just as easily as the right one? So, just how much sympathy should be shown or acted upon because someone pulled the handle of a slot machine and it didn't pay off with the jackpot for which they had gambled? I never had a casino operator run over and apologize for offering me a risk that didn't have any guarantee attached to it.

So, I will not give up on having one prevailing format just because many of us chose to shoot the dice ahead of the main event and came up with craps. I realize we were wooed into our ownerships and we might find satisfaction from blaming our seducers, but who hasn't lost a few hundred to the seducers of this world? It's part of life's education and what is then left to do but to go on to a better informed future? If we dwell on regrets, what do we get? Let's grow up, stop crying over spilt milk and get behind the idea of one format succeeding in the open marketplace. If history is any teacher we won't be sorry for making that choice. _Dale