Blu-ray/HD-DVD format war discussion thread.......

[Mizzou B-ball fan]

Originally Posted by cartman

Well considering the Wal-Mart sold the $99 players, and that the VideoScan numbers don't include Wal-Mart title sales, it is not surprising that those figures didn't show a bump.

That's a widely spread comment, but it actually has little basis in fact. Both the Nielson and VideoScan numbers use distributor numbers as a component of the total number of units being pushed through the retail system in addition to sales numbers from various retailers. Although you're technically correct that Wal-Mart does not divulge their sales numbers to Nielson or Videoscan, they are easily able to identify the Wal-Mart sales numbers through information that they get from the distributors who sell to Wal-Mart.

[gstelmack]

An interesting facet of this war, as I just came back from 2 long car trips: my minivan has a DVD player. Not HD-DVD, not Blu-Ray, and neither was an option at the time. If you think I'm buying Blu-Ray versions of Pixar movies just so I can buy DVD versions as well to take along in the car to keep the kids happy on these long drives, you're nuts.

[Mizzou B-ball fan]

Originally Posted by gstelmack

An interesting facet of this war, as I just came back from 2 long car trips: my minivan has a DVD player. Not HD-DVD, not Blu-Ray, and neither was an option at the time. If you think I'm buying Blu-Ray versions of Pixar movies just so I can buy DVD versions as well to take along in the car to keep the kids happy on these long drives, you're nuts.

To be honest, a HD-quality movie isn't going to offer any better image quality on a smaller screen in a vehicle due to the low resolution. The HD media options are going to be something that's used mostly in the home where you have screens that are large enough to actually use the image quality at a resolution where you can see the difference.

[Fidatelo]

I think his point is that if he buys the HD version, he can't even play it in his car, so he'd have to buy the same movie again in normal DVD format. Since that's not realistic for most consumers, he'll just stick with normal DVD and watch the same disc in both places.

[Travis]

Yes, but it's also fairly standard (I believe) that the HD players will upscale the regular DVD's, so while you can use them in the vehicle systems, they'll still look that much better when watching them on a HDTV. So if you're essentially buying a part of your collection as road entertainment, you'd still have the ability to pick/choose which movies you'd want in true HD for home viewing.

[Atocep]

Originally Posted by Mizzou B-ball fan

Certainly some interesting news on this front, as it appears that my statement that the sale of $99 HD-DVD players in November wouldn't result in more HD-DVD sales is ringing true. Since the sale of over 90,000 HD-DVD players through Wal-Mart in mid-November, the movie sales margin has increased from a 70/30 margin to a 75/25 movie sales margin in favor of Blu-ray. Even more interesting is that HD-DVD was the only format with an exclusive title released during that time (Shrek the Third), yet Blu-ray expanded its lead during that same period. Also, Paramount was criticized by industry writers when it was found that they overinflated the opening week sales numbers of the HD-DVD version of 'Transformers: The Movie' by nearly 70,000 units.

Most industry editorials believe that the influx of the PS3 as a Blu-ray player may have far more of an effect on the movie sales market than Toshiba is letting on. Toshiba has to be concerned at this point that they sold quite a few players on what basically amounted to a fire sale, yet the Blu-ray movie sales numbers continue to outpace the HD-DVD movie sales by an expanding margin.

The gap is much smaller than videoscan shows. Several of the top "selling" blu-ray movies through the black friday week were movies that were given away as part of blu-ray promotions. Also, Videoscan does not include walmart sales and they do not include any numbers from distributers.

Directly from the videoscan website:

Sell-through POS (consumer purchase) sales data are collected weekly from traditional channels of video distribution including mass merchants, audio/video and video specialty retailers, electronics outlets, grocery stores, drug stores, and some Internet sites. Nielsen VideoScan maintains this weekly POS data in one of the largest databases of VHS and DVD products in the country. Data is collected on more than 40,000 VHS items and 12,000 DVD items. Virtually every UPC code in sell-through release since 1993 can be found in our extensive database. Complete sales data in all retail channels are available as far back as January 1999 (however Wal*Mart data is included only through 7/28/01). Prior to January 1999, limited information is available in most channels going back to 1993.

Their numbers are straight from retailers and walmart makes up 40% of HD-DVD movie sales.

[Mizzou B-ball fan]

Originally Posted by Atocep

Also, Videoscan does not include walmart sales and they do not include any numbers from distributers.

Their numbers are straight from retailers and walmart makes up 40% of HD-DVD movie sales.

It may just be the NPD numbers that include the Wal-Mart distributor numbers. I may be incorrect on that. Do you have a link to an article or press release detailing the exact numbers that make up that 40%? Thanks in advance.

Best Buy is the largest percentage retailer of HD media (pretty sure they run around 30-35% of the total HD media sold). Your percentage of 40% may be right, but if so, it shows just how little the HD-DVD movies are selling if Wal-Mart makes up that much of the HD-DVD sales. Percentages are the bane of this format war's existence. When they start citing actual numbers, a totally different picture emerges.

[TroyF]

Originally Posted by Mizzou B-ball fan

It may just be the NPD numbers that include the Wal-Mart distributor numbers. I may be incorrect on that. Do you have a link to an article or press release detailing the exact numbers that make up that 40%? Thanks in advance.

Best Buy is the largest percentage retailer of HD media (pretty sure they run around 30-35% of the total HD media sold). Your percentage of 40% may be right, but if so, it shows just how little the HD-DVD movies are selling if Wal-Mart makes up that much of the HD-DVD sales. Percentages are the bane of this format war's existence. When they start citing actual numbers, a totally different picture emerges.

1) You cannot be serious with this quote, can you? "If Wal-Mart makes up that much of the HD-DVD sales" one? Wal-Mart is freakin huge. Pretending that chain can't make a difference is either stupid or well. . . OK, it's just stupid.

2) If Wal-Mart isn't being included, the actual numbers are useless. Forget about percentages. I just quoted the numbers above that said 4 million HD-DVD and Blu-Ray sales combined trhough September. Wal-Mart could skew those scores in favor of the HD-DVD discs by themselves. Again, you have to understand how big Wal-Mart is.

3) Still, I go back up to my previous post here. the "numbers" show that nobody gives a rats ass about HD DVD or BluRay. 3.8 million Transformers sales the first week of regular DVD, 190k for HD-DVD. Hmmmm. . . That's what, 20 to 1? And that's a high end feature that most HD owners will want. What is the ratio of DVD's to next gen DVD's? Probably around 50 to 1, correct? Adding up the numbers just shows how ridiculous this thing is. I understand you start slow and move up, but at this rate it'll be 2010 before any of this is relevant at all. (and the "new" technology that'll be out by then, most likely high speed downloads and on demand) will have arrived.

[cartman]

I've heard an apt description comparing HD-DVD and Blu-Ray to the 20MB 3.5 floppy vs. Zip drive battles. Both of them were trying to replace 1.44MB floppy drives. But by the time the Zip drive won that battle, consumers had already moved on to different solutions, giving up on those format entirely.

[Atocep]

Originally Posted by Mizzou B-ball fan

It may just be the NPD numbers that include the Wal-Mart distributor numbers. I may be incorrect on that. Do you have a link to an article or press release detailing the exact numbers that make up that 40%? Thanks in advance.

Best Buy is the largest percentage retailer of HD media (pretty sure they run around 30-35% of the total HD media sold). Your percentage of 40% may be right, but if so, it shows just how little the HD-DVD movies are selling if Wal-Mart makes up that much of the HD-DVD sales. Percentages are the bane of this format war's existence. When they start citing actual numbers, a totally different picture emerges.

40% is the number thrown out by High-def digest and just about every other online magazine that covers blu-ray and hd-dvd (A quick google showed 3 different websites that cover both formats using that number). Its cited in this article below, for example, and a few others that I've read.

Granted, I don't know how accurate it is and it could very well be just as accurate as the numbers Sony throws out. However, the HD-DVD/Blu-Ray sales numbers are much closer than videoscan shows.

For example, the week Transformers was released Blu-Ray pointed out that they had the next 7 top selling HD movies. However, out of those seven you had the first two PotC movies, Apocalypto, Deja Vu, and The Prestige. All of which were already on HBO/Starz, ect and were part of give-away promotions. The week of Black Friday the #2 "selling" Blu-Ray title was Open Season, another movie that had been out for quite some time that was a Blu-Ray give-away title.

The facts right now are that PS3 is making a big impact in Blu-Ray sales and the PS3 is starting to sell well. HD-DVD players have reached an install base of around 750,000 and are moving quickly. Its impossible to know how well either side is doing because of promotional give-aways and because videoscan doesn't include Wal-Mart numbers.

http://hddvd.highdefdigest.com/news/show/Wal-Mart/Toshiba/Wal-Mart_Stocks_Sub-$200_HD_DVD_Player/1110

$50 Wal-Mart HD DVD Player: Fact or Fiction? (UPDATED)
Fri Apr 20, 2007 at 07:03 PM ET
Tags: Hardware, Wal-Mart, High-Def Retailing (all tags)

EDITOR'S NOTE: Scroll to the bottom of this article for updated information on this story.

News that Wal-Mart was planning to sell a high-def disc player at the discounted price of anywhere from $50-$299 spread across the web like wildfire Friday, but at the end of the day, the unconfirmed report raises more questions than it answers.

The news first surfaced Thursday morning in a post on AVS Forum which cited a Chinese news agency as reporting that Wal-Mart has signed a deal to produce two million HD DVD players to be sold at a discounted price of $299 a pop.

But as other online news outlets began to pick up the story on Friday (including perhaps most notably, Engadget), questions began to arise over which high-def formats (if any) the original Chinese report was referring to, as translations of the article show that it uses the phrase "Blu-ray HD DVD" or "Blue Light HD DVD" to describe the supported format of the reported disc player.

While the general consensus still seems to be that the rumored Wal-Mart player would play HD DVD discs (and not Blu-ray), without any official word from the retail giant itself, the story remains unconfirmed.

So why all the fuss? If Wal-Mart did choose to support one of the next-gen formats with a low-priced player (and did plan to produce them at these numbers) it could have a profound effect on consumer adoption and on the format wars in general. Wal-Mart is currently responsible for 40% of standard-def DVD sales, and has enormous sway with the studios as a result, so if the company were to exclusively back one of the two next-gen disc formats, it's not out of the realm of possibility that some studios might reconsider their format allegiances.

As of today though, Wal-Mart stocks both formats in limited quantities. And while recent reports have suggested that the retailer has begun favoring Blu-ray with more shelf space than HD DVD, Wal-Mart has made no public statements to suggest that it plans to be anything other than format-agnostic.

I'd guess that number is from Toshiba since them and Wal-Mart are the only two that would know their numbers, so there's a good chance that its an inflated number. However, it stands to reason that Wal-Mart would make up a significant number of HD-DVD sales.

[Mizzou B-ball fan]

Originally Posted by Atocep

I'd guess that number is from Toshiba since them and Wal-Mart are the only two that would know their numbers, so there's a good chance that its an inflated number. However, it stands to reason that Wal-Mart would make up a significant number of HD-DVD sales.

That article states that Wal-Mart makes up 40% of standard DVD sales, not HD-DVD sales as you had previously stated. I'll believe every word you said as long as you're talking about standard DVD sales. Wal-Mart discounts the standard DVD's heavily and makes up a significant portion of those sales. But that article said nothing about the percentage of HD-DVD sales. As I mentioned before, I believe Best Buy is the leader in regard to HD media movie sales at around 30-some percent of the total market.

As far as Toshiba and Wal-Mart keeping the numbers to themselves, that has created more suspicion that their numbers aren't up to snuff more than anything else. If they were smart, they'd release the numbers and show just how well the product line was selling. With them not doing that, it draws further suspicion that they may not be selling as well as they'd like it to be.

[Atocep]

Originally Posted by Mizzou B-ball fan

That article states that Wal-Mart makes up 40% of standard DVD sales, not HD-DVD sales as you had previously stated. I'll believe every word you said as long as you're talking about standard DVD sales. Wal-Mart discounts the standard DVD's heavily and makes up a significant portion of those sales. But that article said nothing about the percentage of HD-DVD sales. As I mentioned before, I believe Best Buy is the leader in regard to HD media movie sales at around 30-some percent of the total market.

As far as Toshiba and Wal-Mart keeping the numbers to themselves, that has created more suspicion that their numbers aren't up to snuff more than anything else. If they were smart, they'd release the numbers and show just how well the product line was selling. With them not doing that, it draws further suspicion that they may not be selling as well as they'd like it to be.

I did read an article that used that number for HD movie sales (thats why I had that number in my mind in the first place), but I'd assume they used that number (standard def sales) to twist the argument in HD-DVD's favor.

[Atocep]

Originally Posted by TroyF

3) Still, I go back up to my previous post here. the "numbers" show that nobody gives a rats ass about HD DVD or BluRay. 3.8 million Transformers sales the first week of regular DVD, 190k for HD-DVD. Hmmmm. . . That's what, 20 to 1? And that's a high end feature that most HD owners will want. What is the ratio of DVD's to next gen DVD's? Probably around 50 to 1, correct? Adding up the numbers just shows how ridiculous this thing is. I understand you start slow and move up, but at this rate it'll be 2010 before any of this is relevant at all. (and the "new" technology that'll be out by then, most likely high speed downloads and on demand) will have arrived.

I generally agree. Neither side is winning and the confusion is really hurting a market that isn't very big to begin with. Before I would completely write of both Blu-Ray and HD-DVD I'd wait to see the holiday sales and how they shape up. I know the $99 HD-DVD player is selling about as fast as Toshiba can make them right now and PS3 sales are picking up.

I don't see either side winning at this point, though. They're cannibalizing themselves over bragging rights and its keeping people from commiting to one or the other.

[Mizzou B-ball fan]

Originally Posted by Atocep

I know the $99 HD-DVD player is selling about as fast as Toshiba can make them right now and PS3 sales are picking up.

Let's be clear. The $99 HD-DVD player was an old model that needed to be cleared out to make room for the new $199 and $299 improved models. They aren't manufacturing the models that are selling for $99 and under in recent sales. They're just clearing stock at this point. Toshiba is actually causing a bit of a problem for itself as the sales for the newer models are suffering right now. Consumers are now EXPECTING a HD-DVD player at $99. As a result, they aren't buying the $199-299 models at any rate near to what they were selling before, which wasn't that big to begin with.

[Daimyo]

This "war" will be over quickly if Wal-Mart choses HD-DVD. That was rumored several months back, but now its actually starting to look possible...

[Mizzou B-ball fan]

Originally Posted by Daimyo

This "war" will be over quickly if Wal-Mart choses HD-DVD. That was rumored several months back, but now its actually starting to look possible...

Do you have a link for that information? Thus far, Wal-Mart has gone out of their way to note that they don't plan on limiting themselves to either format anytime in the near future.

[Daimyo]

A link to the "rumors" or to me thinking its starting to look possible? The first is well... rumors... the second is synthesis.

[rjolley]

In WalMart last night, they were playing the BluRay marketing disc on all of their tvs. Saw that and thought of this thread.

BTW, I didn't know BluRay disks were supposed to be extremely resistant to scratching. Are HD-DVD disks the same way?

[Mizzou B-ball fan]

Originally Posted by rjolley

In WalMart last night, they were playing the BluRay marketing disc on all of their tvs. Saw that and thought of this thread.

BTW, I didn't know BluRay disks were supposed to be extremely resistant to scratching. Are HD-DVD disks the same way?

Sony paid quite a bit of money to get prime display space for their BR demo discs in most retail stores. Wal-Mart, Target, Best Buy and Circuit City were just a few of the retailers that had that demo running non-stop.

I don't believe that the HD-DVD disks are quite as durable as BR disks from a scratch perspective, but certainly are no less durable than the standard DVD's.

BR disks are ridiculously durable. There's several videos on the internet where people rubbed BR disks with steel wool, scratching them all to hell. Amazingly, they stuck in the disks and they played just fine. Certainly an extreme example, but impressive nonetheless.

[Fidatelo]

Originally Posted by Mizzou B-ball fan

There's several videos on the internet where people rubbed BR disks with steel wool, scratching them all to hell. Amazingly, they stuck in the disks and they played just fine. Certainly an extreme example, but impressive nonetheless.

Extreme? How else do you clean your discs?

[Mizzou B-ball fan]

Originally Posted by Fidatelo

Extreme? How else do you clean your discs?

Spit and a lot of rubbing. Wait, what is the topic of this thread?????

[Fidatelo]

Akon?

[Pumpy Tudors]

did somebody page me to this thread

[SackAttack]

Originally Posted by Mizzou B-ball fan

Sony paid quite a bit of money to get prime display space for their BR demo discs in most retail stores. Wal-Mart, Target, Best Buy and Circuit City were just a few of the retailers that had that demo running non-stop.

And freezing and stuttering non-stop!

Although that's not really a Blu-ray thing, that's a "non-stop" thing.

[Mizzou B-ball fan]

Originally Posted by SackAttack

And freezing and stuttering non-stop!

Although that's not really a Blu-ray thing, that's a "non-stop" thing.

You would think that companies would figure out better display models to avoid overheating issues with their consoles and media players, wouldn't you?

A couple of weeks ago, I saw a Xbox 360 and a Blu-ray player on display at Wal-Mart. The Blu-ray player was 'going blocky' on the display on occasion and the 360 was sitting there with the RROD on display for the public to enjoy. Any chance they can get these machines some place with a little more air circulation? Unbelievable.

[Mizzou B-ball fan]

Paramount needs to find a way to shut up its directors. First, Spielberg refuses to allow any of his movies to go HD-DVD exclusive as part of the Paramount deal. Now, Michael Bay is sounding off yet again. I'm not sure that the information in his comments is all that new as most have known for sometime that Microsoft is playing hardball behind the scenes while allowing Toshiba to take the brunt of the criticism. However, Paramount's two major directors appear to be undermining the HD-DVD arrangement in any way possible. Paramount has some major PR issues that need to be addressed.

Outspoken director Michael Bay has once again posted a note on his website in regards to the format war, this time calling out Microsoft. He pointed out, similar to what many insiders have been saying for a while, that Microsoft was only trying to destroy both formats in order to usher in digital downloads. Mr. Bay called Blu-ray the "superior" format and hinted that Microsoft was behind the now infamous Paramount payoff.

Below is the full post:

[Vinatieri for Prez]

Why is that a dirty little secret? I would welcome digital downloads over either format. So I cheer Microsoft on. And as I have said all along. Microsoft need not worry. The two formats will die a slow death all on their own.

[Mizzou B-ball fan]

Originally Posted by Vinatieri for Prez

Why is that a dirty little secret? I would welcome digital downloads over either format. So I cheer Microsoft on. And as I have said all along. Microsoft need not worry. The two formats will die a slow death all on their own.

The problem right now is that you're in the minority as most people don't prefer downloads for movies. It's certainly easy to access, but general consumer consensus favors the disc option. You're able to take ownership of the disc and can sell it or give it to someone else without any problems. Digital downloads allow a further amount of control for the music and movie industries that most people do not want to deal with.

As for 'cheering them on', there's very few people (including federal and state governments) who like the idea of Microsoft trying to monopolize any industry to their advantage. We've already been down that road with MS several times over.

[Vinatieri for Prez]

Originally Posted by Mizzou B-ball fan

The problem right now is that you're in the minority as most people don't prefer downloads for movies. It's certainly easy to access, but general consumer consensus favors the disc option. You're able to take ownership of the disc and can sell it or give it to someone else without any problems. Digital downloads allow a further amount of control for the music and movie industries that most people do not want to deal with.

As for 'cheering them on', there's very few people (including federal and state governments) who like the idea of Microsoft trying to monopolize any industry to their advantage. We've already been down that road with MS several times over.

If we can assume the download is cheaper because of no production costs of disc, box, shipping, etc., then I would think you would get a lot of converts. However, I do agree anti-piracy efforts may hamper its attractiveness. But, for instance if you could double your movie collection for the same price, I would think this would be very attractive to a lot of people.

I'm cheering Microsoft on for "innovation" not monopoly. Once they set up the technology and business plan and get it going where it is streamlined and profitable, others will follow. There most definitely will not be a monopoly on selling digital downloads of movies, just as there isn't one now with songs.

[Mizzou B-ball fan]

Originally Posted by Vinatieri for Prez

I'm cheering Microsoft on for "innovation" not monopoly. Once they set up the technology and business plan and get it going where it is streamlined and profitable, others will follow. There most definitely will not be a monopoly on selling digital downloads of movies, just as there isn't one now with songs.

Microsoft isn't generally known for innovation. They're known for taking or buying a technology from someone else who created it and then incorporating that technology into the Windows OS in a way that maximizes the barriers to entry for their competitors, thereby creating a quazi-monopoly and raking in the cash. That's exactly what they'd love to do with movie downloads. That shouldn't come as a surprise to anyone.

[gstelmack]

I'd use the 360 download HD movies feature right now if I had more than 24 hours to watch. With kids I'm likely to get partway through tonight and want to finish tomorrow, but 24 hour window does not work for that.

I'm intrigued by the Netflix "buy so many hours of watching each month" approach. I think it's fantastic and may actually look into it instead of continuing to buy DVDs at all. Of course, it has to have HD movies for me to be willing to do this. I think that model has a lot going for it.

[Mizzou B-ball fan]

Originally Posted by gstelmack

I'd use the 360 download HD movies feature right now if I had more than 24 hours to watch. With kids I'm likely to get partway through tonight and want to finish tomorrow, but 24 hour window does not work for that.

I'm intrigued by the Netflix "buy so many hours of watching each month" approach. I think it's fantastic and may actually look into it instead of continuing to buy DVDs at all. Of course, it has to have HD movies for me to be willing to do this. I think that model has a lot going for it.

I should state that my thoughts on digital download vary greatly based on whether it's a subscription/rental versus a purchase. I'm specifically railing on the system that MS would like to use where you actually purchase the movie and download it to use indefinitely. I have a problem with that system as there's no real level of ownership and there's obviously going to be some major anti-piracy software that could cause major issues for a person who purchases that movie.

In regards to digital download for a rental, I think it's a wonderful idea. I know that the 360 already has the short-term rental download that gstelmack mentioned and that Sony will be launching a similar model in Japan this month for the PS3 with it going worldwide early next year. Those kinds of systems are great with the only complain being the short timeframe that gstelmack mentioned. 2-3 days would be much better. I've tried out a few movie downloads on the 360 and been very happy with the product.

[sterlingice]

Originally Posted by Mizzou B-ball fan

Microsoft isn't generally known for innovation. They're known for taking or buying a technology from someone else who created it and then incorporating that technology into the Windows OS in a way that maximizes the barriers to entry for their competitors, thereby creating a quazi-monopoly and raking in the cash. That's exactly what they'd love to do with movie downloads. That shouldn't come as a surprise to anyone.

Definitely

SI

[TroyF]

Originally Posted by Mizzou B-ball fan

Microsoft isn't generally known for innovation. They're known for taking or buying a technology from someone else who created it and then incorporating that technology into the Windows OS in a way that maximizes the barriers to entry for their competitors, thereby creating a quazi-monopoly and raking in the cash. That's exactly what they'd love to do with movie downloads. That shouldn't come as a surprise to anyone.

I don't think they are that stupid.

Would they like to get their foot in the door and be the company everyone thinks about with movie downloads like the IStore for MP3's? Sure. Do they think they can be the sole provider of the service and lock people out? Please. . .

[Mizzou B-ball fan]

Originally Posted by TroyF

I don't think they are that stupid.

Would they like to get their foot in the door and be the company everyone thinks about with movie downloads like the IStore for MP3's? Sure. Do they think they can be the sole provider of the service and lock people out? Please. . .

Oh, they won't be able to lock people out (hence the reason I said quazi-monopoly), but they'll make it a bitch to get in. MS ends up in a massive lawsuit every couple of years for this very reason. They eventually pay a fine and still end up pocketing the profits. This has been their MO for years.

[BrianD]

Originally Posted by Mizzou B-ball fan

In regards to digital download for a rental, I think it's a wonderful idea. I know that the 360 already has the short-term rental download that gstelmack mentioned and that Sony will be launching a similar model in Japan this month for the PS3 with it going worldwide early next year. Those kinds of systems are great with the only complain being the short timeframe that gstelmack mentioned. 2-3 days would be much better. I've tried out a few movie downloads on the 360 and been very happy with the product.

This was the model that Circuit City tried to push with their DIVX plan as an early competitor to DVD. "Buy" a DVD for $3.00 and have a 72-hour window to watch the movie which starts when you first press play. After that time the disc would be worthless and you could toss it in the trash. Digital download rental is just the online version of this plan.

DIVX died a quick death because people want to own their media and watch it when they want. They don't want to pay for each viewing. A rental plan may work, but they have to give the ability for permanent ownership (with portability) as well.

[Mizzou B-ball fan]

Originally Posted by BrianD

This was the model that Circuit City tried to push with their DIVX plan as an early competitor to DVD. "Buy" a DVD for $3.00 and have a 72-hour window to watch the movie which starts when you first press play. After that time the disc would be worthless and you could toss it in the trash. Digital download rental is just the online version of this plan.

DIVX died a quick death because people want to own their media and watch it when they want. They don't want to pay for each viewing. A rental plan may work, but they have to give the ability for permanent ownership (with portability) as well.

I never liked that setup because of the 'throw away' plan. Seems kind of useless to increase the amount of waste for no really good reason.

[gstelmack]

DIVX also had the problem of requiring special players. Nobody wanted to pay extra ($50 - $100) for a player to play these special discs.

It's different when you are talking about broadband internet download to a computer / console you already own and a consumer market that is used to watching downloaded movies (YouTube, iPhone, etc).

The biggest issue standing in the way of digital downloads is transportability. Download to your computer, start watching, move it to your laptop to finish watching on the plane. That is the other big hurdle aside from the very limited viewing windows they are giving now. But again, one that I think the Netflix model works around.

[BrianD]

Originally Posted by Mizzou B-ball fan

I never liked that setup because of the 'throw away' plan. Seems kind of useless to increase the amount of waste for no really good reason.

I agree, but I don't think that is why the format failed so quickly. There is a place for rentals, but they won't ever replace ownership for all movies. This biggest example for this is any Disney or Pixar movie in a house with young kids. They will watch the movies hundreds of times, so an ownership plan is necessary. In addition to ownership, you also need portability. DIVX tied their movies to a single machine, which you can't do with a kids movie. If the same downloaded format can handle a rental model and a permanent ownership model with portability, it will have a chance to succeed. All of those components are necessary.

[Mizzou B-ball fan]

Wow, some big news here. Sounds like Warner Studios has been in discussions with both HD formats concerning an exclusive deal since mid-year 2007. It is believed that whoever can sell more movie units this holiday season will get an exclusive commitment from Warner Studios in January.

http://www.highdefdigest.com/news/sh...ormat_War/1245

Report: Warner Takes Centerstage in High-Def Format War
Fri Dec 07, 2007 at 01:56 PM ET
Tags: Warner (all tags)

A new BusinessWeek article focuses on the efforts of major players on both sides of the format war to woo dual-format supporting studio Warner Bros to their side exclusively.

According to the article, Warner has stepped up discussions with backers of both formats since late summer, with Sony CEO Howard Stringer reportedly making personal appeals to Richard Parsons and Jeffrey Bewkes, the two top executives at Warner parent Time Warner.

If Warner were to move to one side of the aisle, it could drastically change the shape of the format war. A Warner move to Blu-ray exclusivity would give that format an exclusive 70% share of the DVD market, while a move to HD DVD would give both formats more or less equal shares.

For its part, Warner itself isn't talking, although widely reported comments made by Warner VP Dan Silverberg in late October appeared to back up reports that the studio is indeed considering dropping its format agnostic stance.

"When both formats launched and hardware prices were high, we made a decision to support both formats and let the consumer decide," said Silverberg. "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."

Athough insiders give Blu-ray the advantage, according to unnamed studio sources quoted by BusinessWeek, Warner is waiting to see which format sells more this holiday before making its decision. "Warner wants one of the two sides to make a commitment to getting this format into as many hands as possible," said the source.

[Mizzou B-ball fan]

Here is the Business Week article concerning the possible Warner deal.........

http://www.businessweek.com/magazine...3028294846.htm

December 6, 2007, 5:00PM EST

Next-Gen DVDs: Advantage, Sony
Sony-led backers of Blu-ray seem to have pulled ahead of rivals in the race for a single high-def DVD standard
by Ronald Grover and Cliff Edwards

It's a fight with more plot twists and intrigue than a Hollywood thriller. For two years now, rival camps have been battling over which new DVD format will prevail: Blu-ray, which is backed by Sony (SNE) and a consortium of 170 other companies, or HD DVD, which is being championed by Toshiba (TOSBF), Microsoft (MSFT), and others. Both technologies promise crisper video that looks better on the new generation of flat-panel, high-definition TVs. And the winner stands to control a lucrative new market worth billions. Each side has been competing to win the backing of the major movie studios. Only Warner Bros. (TWX), which currently uses both formats, is still playing hard to get.

Now, with the Jan. 7 International Consumer Electronics Show fast approaching, Sony and Toshiba are keen to announce they have won over Hollywood's last holdout. In the meantime, they are falling over themselves to woo Warner. While either side could prevail, the Sony group has suddenly emerged as the front-runner.

Why? Because despite a setback this summer when the HD DVD companies signed up Paramount Pictures (VIA) and DreamWorks Animation (DWA), the Blu-ray forces have still lined up more studios than the HD DVD side. Plus this year, the Sony team has sold more than twice as many discs. "The rumor is that Warner is coming aboard soon," says Michael Burns, vice-chairman of studio Lionsgate (LGF), which makes its movies available on the Sony-backed format. "That will make it awfully tough for HD DVD to stay in this game." (Sony declined to comment, and Toshiba only would say it is "in regular contact with the studios.")

From the beginning, the two camps' overarching strategy has been the same: getting access to as many movies as possible. It isn't hard to see why. Consumers will buy the new technology only if they believe most of the films they want will be available.

Right now the Blu-ray team has enough studios on board—among them Disney (DIS), Fox (NWS), and, of course, Sony—to account for about 49% of current DVD market share. Warner is a prolific film factory, releasing as many as 30 pictures a year, including those produced by sister studio New Line Cinema. Persuading it to sign an exclusive deal would give the Sony crowd about 70% of DVD market share. That could prompt the other studios to abandon HD DVD.

On the other hand, if Toshiba were to win Warner's hand, the two forces would divide the market between them. That could create mass consumer confusion and potentially strangle a new technology that the studios hope will give a lift to flagging DVD sales. That's exactly why Warner has long pushed for a single format.

WOOING WARNER
The battle has heated up since HD DVD got Paramount and DreamWorks Animation. Both sides have been beating a path to Warner's Burbank (Calif.) doorstep. Yoshihide Fujii, the head of Toshiba's HD DVD business in Japan, has made three trips to the U.S. since the summer, say those with knowledge of the situation. And while Andrew House, Sony's chief marketing officer, has been pressing the Blu-ray case, the stakes are sufficiently high that Sony CEO Howard Stringer has been making personal appeals to Richard Parsons and Jeffrey Bewkes, the two top executives at Warner parent Time Warner (TWX).

Toshiba is pressing the case that because its technology is cheaper, it will more quickly become a mass-market product. According to the DVD Release Report, an industry newsletter, the suggested retail price of an HD DVD is $31.74, nearly $2 less than Blu-ray's suggested price. (Retailers traditionally cut the price to less than $29.) Toshiba also has been cutting the price of its players, slashing its entry-level machine to $299 earlier this year.

It was price that prompted DreamWorks Animation and Paramount to throw in their lot with HD DVD earlier this summer. (Like Warner, Paramount had previously backed both formats.) "The game-changer for us was the hardware costs dramatically coming down to where it could succeed broadly for the consumer," says DreamWorks Animation CEO Jeffrey Katzenberg. "In addition, the software manufacturing costs in the future would be significantly lower than Blu-ray." Of course, it didn't hurt that Toshiba agreed to pay Paramount and DreamWorks Animation a combined $150 million in incentives, including money to license DreamWorks' Shrek character for marketing purposes.

The Blu-ray faction insists there is no burning reason for it to match HD DVD's prices. "We think Warner will respond to the fact that our greater number of titles gives us a greater likelihood of being the single standard," says Andy Parsons, who leads the Blu-ray lobbying effort. But another executive backing Blu-ray, who didn't want to be identified, expects the imminent arrival of a sub-$300 Blu-ray machine.

What's more, Hollywood insiders say the $150 million that the Toshiba group showered on Paramount and DreamWorks Animation radically changed the game. These people suggest the Blu-ray team is so determined to win that it will throw hundreds of millions of dollars of marketing support behind Blu-ray equipment if Warner gets on board.

Warner isn't talking, but people close to the situation say the studio is waiting to see which group sells more of the new-fangled DVD players this holiday season. "Warner wants one of the two sides to make a commitment to getting this format into as many hands as possible," says a studio executive with knowledge of its thinking.

So far Toshiba has eked out a lead. According to industry tracker Adams Media Research, by the end of this year as many as 578,000 U.S. households will own HD DVD players, compared with 370,000 that have Blu-ray players. Adams also estimates there are 300,000 more HD DVD players in circulation inside Microsoft Xbox game consoles. But that still pales in comparison to the estimated 4 million Blu-ray-equipped Sony PlayStation 3 consoles sold in the U.S.

The Blu-ray side has another advantage. Disney caters to families, who buy lots of older films for their kids. That could help the format build critical mass. "The Blu-ray customer is more likely to build a new library," says market researcher Richard Doherty. "Studios live for [that]."

That leaves one question. If the Sony camp wins Warner, will the other studios ditch HD DVD? They're not saying. But Dreamworks Animation and Paramount only signed on with the Toshiba side for 18 months. So then they could take the money and run.

[gstelmack]

Originally Posted by Mizzou B-ball fan

Toshiba is pressing the case that because its technology is cheaper, it will more quickly become a mass-market product. According to the DVD Release Report, an industry newsletter, the suggested retail price of an HD DVD is $31.74, nearly $2 less than Blu-ray's suggested price. (Retailers traditionally cut the price to less than $29.) Toshiba also has been cutting the price of its players, slashing its entry-level machine to $299 earlier this year.

Players are one side of this equation, but until I can walk into Target (my preferred location), BJs (my second preferred location), or Wal-Mart (which I avoid if possible) and get new-release HD-DVDs or Blu-Rays for $20 or less, I don't think either side is going mass-market. $20 has always been my tipping point on DVDs, and the only things I've paid more than $20 for were the Lord of the Rings trilogy parts, which are like 3 movies in one anyway. They are deluding themselves if they think discs will start flying off the shelves while priced at $29.

[Daimyo]

I really like the Amazon Unbox model. You can buy or rent videos and download them to your computer or TiVo (and some portable devices too i think). You can have it on up to 2 devices at any time. if you buy a video you can always re-download it again in the future (as long as it never lives on more than 2 devices at once). The only problem is that it doesn't do HD yet... I've purchased some TV shows and rented a few movies. The TiVo integration is awesome.

[Mizzou B-ball fan]

Originally Posted by gstelmack

Players are one side of this equation, but until I can walk into Target (my preferred location), BJs (my second preferred location), or Wal-Mart (which I avoid if possible) and get new-release HD-DVDs or Blu-Rays for $20 or less, I don't think either side is going mass-market. $20 has always been my tipping point on DVDs, and the only things I've paid more than $20 for were the Lord of the Rings trilogy parts, which are like 3 movies in one anyway. They are deluding themselves if they think discs will start flying off the shelves while priced at $29.

Amazon has all kinds of deals on both BR and HD-DVD formats on what seems like a weekly basis. There's really no reason to pay any more than $20 as you said unless you just simply need it right then on the spot.

[dervack]

Originally Posted by Mizzou B-ball fan

Amazon has all kinds of deals on both BR and HD-DVD formats on what seems like a weekly basis. There's really no reason to pay any more than $20 as you said unless you just simply need it right then on the spot.

Wow, this Amazon sounds like a sweet store. Do they have a website where I can find a local store close to me?


You must have missed the part where he said walking in. I own a shitload of DVDs and they are mostly impulse buys. While Amazon might have deals on both BR and HD-DVD's, looking at site for movies isn't an impulse buy.

[Mizzou B-ball fan]

Originally Posted by dervack

Wow, this Amazon sounds like a sweet store. Do they have a website where I can find a local store close to me?

You must have missed the part where he said walking in. I own a shitload of DVDs and they are mostly impulse buys. While Amazon might have deals on both BR and HD-DVD's, looking at site for movies isn't an impulse buy.

Certainly, DVD's are a totally different situation. You can find just about anything you want. With HD movies, the selection can vary quite a bit based on the store. Right now, impulse buying isn't all that prevelant for HD movies. Online is the best alternative until the situation improves to where there's a larger selection at most stores.

[dervack]

You missed the point, but I'm not surprised.

[Travis]

Originally Posted by dervack

Wow, this Amazon sounds like a sweet store. Do they have a website where I can find a local store close to me?


You must have missed the part where he said walking in. I own a shitload of DVDs and they are mostly impulse buys. While Amazon might have deals on both BR and HD-DVD's, looking at site for movies isn't an impulse buy.

Maybe for you, but I've got more than a couple movies I bought on impulse after seeing them in the 2 for 1 sales online. I do a lot of my shopping online (especially since the Canadian dollar shot up) and have definitely bought more than I would have walking into any store, be it BR or regular DVD's.

[Vinatieri for Prez]

Originally Posted by Mizzou B-ball fan

Microsoft isn't generally known for innovation. They're known for taking or buying a technology from someone else who created it and then incorporating that technology into the Windows OS in a way that maximizes the barriers to entry for their competitors, thereby creating a quazi-monopoly and raking in the cash. That's exactly what they'd love to do with movie downloads. That shouldn't come as a surprise to anyone.

I won't disagree with your characterization of what MS's "perfect world" would be. But that simply won't work for digital download movies. They won't even have a quasi-monopoly (unless they just come up with a system that beats out the competition on better price/service/selection/delivery). What I am looking at is innovation in the sense of a business model/delivery system, which anybody can try to emulate and compete. I don't believe that technology (other than piracy issues) is the real stumbling block here.

With that said, you can't deny that MS is an innovative company. Some may not like "how" they implement that innovation, but whether it's created in-house or purchased, they have brought innovative products to the marketplace.

Regardless, the fact that a company like MS may be hot on the trail of moving the marketplace that much closer to digital downloads is a good thing in my opinion.

[Mizzou B-ball fan]

Originally Posted by BrianD

I agree, but I don't think that is why the format failed so quickly. There is a place for rentals, but they won't ever replace ownership for all movies. This biggest example for this is any Disney or Pixar movie in a house with young kids. They will watch the movies hundreds of times, so an ownership plan is necessary. In addition to ownership, you also need portability. DIVX tied their movies to a single machine, which you can't do with a kids movie. If the same downloaded format can handle a rental model and a permanent ownership model with portability, it will have a chance to succeed. All of those components are necessary.

I forgot to mention this, but Sony already has a version of this in the works. They plan to have a standard def version of the movie on every BR disc sold. The file on that BR disc can be put onto a memory card and played on the PSP or you can use remote play and just log into your PS3 from your PSP to watch the movie. It's supposed to be available on all BR discs starting sometime next year.