UPDATED -- Has HD DVD demise helped Blu-ray?
The NPD Group released a report today showing that post-holiday sales of Blu-ray didn't exactly skyrocket after Toshiba folded the HD DVD tent in February. After dropping 40 percent from January to February, sales of set-top Blu-ray players (i.e., those not built into a PlayStation 3) crept up 2% in March, NPD said. HD DVD sales, meanwhile, fell off a cliff that month.
You could hypothesize that high-def disc players are suffering the same business-cycle doldrums as other consumer goods. More plausible is that conventional DVDs look so good on most high-definition sets (i.e., 42" and smaller), consumers don't see the need to invest in a pricey upgrade. Here's NPD's Ross Rubin's take, from the NPD release:
That standalone Blu-ray players haven’t picked up significantly from HD DVD’s loss shows that few consumers were dissuaded primarily by the ‘format war.' When we surveyed consumers late last year, an overwhelming number of them said they weren’t investing in a new next-generation player because their old DVD player worked well and next-generation players were too expensive. It’s clear from retail sales that those consumer sentiments are still holding true.
Notably, sales of relatively inexpensive "upconverting" disc players that produce simulated high-def pictures from conventional DVDs were 5% higher in Q1 2008 than in Q1 2007, NPD said.
Studios can try to goose Blu-ray sales by loading discs with features that aren't available on DVD. Beyond their advantages in capacity and audio-visual quality, the high-def discs offer far superior navigation and interactivity, including the ability to draw content from the Web. But the biggest factor may be out of Hollywood's control, and that's the price of the hardware. Back when VCRs were still king, sales of DVD players didn't really take off until prices dropped below $200 in 1999, and they weren't a mass-market item until they were available for less than $100. Most Blu-ray players are still priced well north of $300.
UPDATE -- Andy Parsons of Pioneer said his company, which makes premium-priced Blu-ray players, saw "a distinct increase in demand" after HD DVD hit the skids in early January. The implication is that sales would have grown faster if manufacturers hadn't scaled back production in anticipation of the usual post-holiday slow-down. Retailers are "screaming for Blu-ray players, they can't get enough of them," Parsons said. "If you don't have product to ship, obviously the numbers are going to be low."
Parsons also wondered whether consumers bought PS3's to satisfy their demand for Blu-ray players when they couldn't find a set-top version. It's hard to tell what motivated people to buy a PS3, though, so NPD's decision not to include those sales in its Blu-ray statistics is understandable.
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Maybe Andy Parsons from Pioneer can explain why all the local retailers here have stacks of dusty Blu-ray players. Lack of inventory is clearly not an issue.
Posted by: HTPC Guy | April 30, 2008 at 09:01 PM
Your stats are horrible: month to month declines often reflect seasonal variation--that Feb and March are than Jan and Feb is not conclusive. If you demonstrated that March '08 sales were relatively flat compared to March '07 sales, that would indicate a real lack of growth. Oddly, you do use the more standard year to year comparison when discussing upconverting players. If only the methodology were consistent throughout the article.
Also, given the increase in the number of players offering upconversion and the increase in the percentage of such players on the market, it is likely that they reflect a shift in purchases of standard DVD players and not necessarily an indication that users are choosing them instead of Blu-Ray (or that the buyer considered any HD format).
Posted by: J Staggie | May 01, 2008 at 12:51 AM
More evidence that it's convenience, rather than quality, that really drives sales (DVDs and CDs were revolutions in convenience - Blu-Ray is primarily just a bump-up in quality). And it's also true, as you pointed out, that the quality DVDs deliver on sets in the 40ish and under range is pretty terrific.
Posted by: David Colker | May 01, 2008 at 07:52 AM
That depends on where "here" is for HTPC Guy, and which models are collecting dust there. I am not claiming that BD players cannot be found anywhere. But we are hearing from retailers that they have not been able to get nearly enough of the most popular models until just recently. A remnant of this is the very popular Panasonic DMP-BD30 player, SRP of $499, that is currently shown on Amazon.com at $749 from a third party retailer.
-- Andy Parsons, BDA
Posted by: Andy Parsons | May 01, 2008 at 01:16 PM
Year over year, BD disc sales are up over 300%.
PS3 also happens to be one of the best BD player on the market.
300% over last year. Why don't you look at disc sales, which are the actual determination of what will be a successful format?
Posted by: Hoosier Daddy | May 02, 2008 at 12:32 AM
The reason Blu-Ray sales are not taking off are fourfold:
First of all, high quality upconversion dvd players look almost as good on hi-def sets, and they only cost around $100 or less!
Secondly, the blu-ray machines are still very expensive. They range from $400 to $1000, and all but the PS3 are not even at full spec yet!
Furthermore, the blu-ray discs cost between $25 and $40, while their dvd counterparts are usually less than $20.
Lastly, the "Tanya Harding" -style tactics the Blu-Ray Association used to knock out the far superior HD-DVD format by getting Warner Home Video to discontinue the format, was appalling to many consumers. They didn't like losing their freedom of choice.
Posted by: Arnold Darrow | May 27, 2008 at 09:59 AM