Blu-Ray sales not helped by HD DVD death

New reports from ABI Research and NPD Group state that the death of HD DVD and the end to the format war has not helped Blu-Ray player sales, and that Blu-Ray is looking at an uphill battle in its efforts to entrench itself in coonsumer’s living rooms.

It’s been a couple months since HD DVD bowed out of the battle to become the next-generation DVD technology, but Blu-Ray has not been able to capitalize on being the last man standing. From January to February, Blu-Ray hardware sales fell 40 percent, excluding the Playstation 3 console. Following the HD DVD announcement in February, sales only rose two percent from February to March, according to NPD Group.

Several factors could be leading to this, but two are likely the biggest culprits: price and apathy. Player prices are still in the “premium” range in consumers minds, not yet hitting that magic $200 mark. Also, Blu-Ray disc prices still outpace standard DVDs by a substantial margin, more than 2:1 in many cases.

Many consumers still profess they can’t tell the difference between a Blu-Ray image and a standard DVD image. While this may be hard to believe, it shows the amount of work needed to show consumers what they are missing. Also not helping the cause are the cheap prices on upconverting DVD players, as low as $70 now, and consumer confusion surrounding those players. Many people think an upconverting player IS an HD player, falling in line with statistics that show that around 50 perecent of people with HDTVs aren’t getting an HD signal and don’t even know it.

ABI’s research shows that the PS3 will make up 85 perecent of the Blu-Ray hardware market in 2008, and it will maintain its majority lead until 2013, yet again solidifying the argument that the PS3 is the best Blu-Ray player currently available.

With all that said, however, it’s not surprising the adoption has been slow since the dust settled. During the high tide of the format battle, each side was cutting prices, offering incentives and inciting rabid fan bases to make purchases to help their format win. That pressure no longer exists, and the amount of incentives on Blu-Ray players has slowed.

Perhaps the biggest roadblock to Blu-Ray adoption however, is the one that is being somewhat ignored: an incomplete standard emerged at the end of the format war. Blu-Ray is in the midst of what it calls its “profiles”, with profile 2.0 being the complete spec. Profile 2.0 players are just now slowly starting to make it to market, and they are well about the prices of other Blu-Ray players currently available. The PS3 recently was updated to Profile 2.0, which allows ineractivity via BDJ as well as picture in picture, both features that HD DVD featured from the beginning, but I digress.

At this point the high definition disc party is still full of early adopters and audiophiles and videophiles, the general consumer has not entered the market yet. So for those of us who went with HD DVD, or other high-def aficionados who waited on the sideline, we’re educated enough to know that this is not the time to be buying a Blu-Ray player. That means a large portion of Blu-Ray’s target consumer knows to wait until the end of the year at the earliest to buy a new player, when prices come down – at least slightly – and Profile 2.0 players and movies dot the landscape. Until then, I see similar numbers for Blu-Ray hardware sales, excluding Sony’s PS3 which is gaining momentum in the video game market.

Other factors loom large for the future of Blu-Ray as well, with Apple announcing today that it has agreements with most of the major studios to put movies on iTunes day-and-date with their release on DVD, some in HD. This is just another push toward the eventual evolution to a physical media-less entertainment society (see Netflix and Blockbuster’s set-top-boxes), one that Blu-Ray is dreading.

The next 12 months will be huge for Blu-Ray. This Christmas season must see Blu-Ray gain serious momentum if it’s going to gain enough traction before consumers make the leap to downloading their movies, otherwise Sony might still have a new Betamax on its hands.

The iPhone gets cheaper, somewhat

After seeing this post on Engadget about AT&T selling refurbished iPhones for $249, I was a bit miffed about spending $349 last week on the Apple Store for a refurbished iPhone. Not one to take these types of things lying down, I promptly called Apple.

After the mandated “we can’t match prices” and “I find it hard to believe it’s that cheap” with a helping of “I’m not really sure the quality of the ones AT&T are selling is as high as ours” from the phone rep, I did get him to throw me a small bone: a free case from the store.

Since I was already shopping for one, I figured this was better than nothing. I promptly choose the $50 one he recommended, should be here in a couple weeks. And now I get to keep the Best Buy Reward Zone certificates I had earmarked for the case. Woo hoo!

Touch no more, iPhone it is

My 30-day trial period has ended, a bit earlier than the 30 days even. After living with the iPod Touch for 16 days, I turned it in and went up to the iPhone. Several things led to my decision:

1. The more I used the Touch (a great product in it’s own right, mind you. The best iPod available), the more I realized I would ultimately miss the features the iPhone had that the Touch didn’t, namely the external speaker (making random YouTube watching much easier without having to always dig out headphones) and the camera. Honestly the phone aspect of it was very low on my priority list. It’s nice to have one device, but certainly not a the most important item. I think had the Touch sported the two options above, I might have kept it.
2. While surfing the Apple store online one day (because come on, who doesn’t surf the Apply Store?), I came across a refurbished iPhone for only $349. That made the switch a bit more palatable knowing I only had to cough up an extra 50 bucks.
3. And here’s the biggie, I stumbled on a out for my Verizon contract. Thanks to a little help from The Consumerist Web site, I discovered that there’s an out in the Verizon contract. Basically, there’s a part of the contract that states Verizon can make changes to the contracts or rates at any time, but that if those changes have a “material adverse affect” on you, you can cancel the contract without an early termination fee. Text message rates went from 10 to 15 cents last year, and from 15 to 20 cents this year. That change falls under the clause, so I called. For right now, they allowed me to get out of one line (my wife’s) with no fee since she had more text message usage than I did. However, once I get my final bill I’ll be calling again to get the other fee cancelled. Even if they ultimately deny it, once you figure that I got the iPhone for 50 bucks off, I will only have to pay $50 to get out of Verizon.

So there it is. Again, the Touch is a great product, wireless works well, everything you would expect (and on sale for $15 off at Best Buy.com right now). But for me, I knew I would want the iPhone when my Verizon contract was scheduled to come up in January, and I knew I wouldn’t be able to swing (nor need) and Touch and the iPhone, so when all the above things came together at once, my decision was made.

Unlike my buddy Rich, who found to his horror that service levels were very poor for him when he got his iPhone, I’ve had no troubles thus far. My friend Jesse (also an iPhone owner) said it best yesterday. While watching the Pistons dismantle the Hornets on ABC in glorious HD, an iPhone ad came on. We were in the midst of zooming past it on the DVR when he stopped, backed it up, and played the ad. After a second he said outloud “Doesn’t it feel different to watch these commercials now?” Indeed it does.

Random weekend thoughts

I’m one week into my iPod Touch trial. So far so good. I do enjoy the technology, no doubt. The question I have to answer for myself is do I want to keep it and forgo an iPhone in a year when my Verizon contract comes up, or take it back and hold out until Jan. 9, 2009. I’ve gone back and forth many times. I’m not up for buying an iPhone and jailbreaking it to use as an iPod so that’s not an option. Suggestions? Let me know.

Watched Pan’s Labyrinth on HD DVD yesterday while sick. Good movie, great HD DVD. Sound was amazing, especially in the scenes in the caverns and enclosed spaces. Great spatial representation. I’ll try to post a more extensive review over the weekend if my cold continues to regress. Also checked out Blade Runner but I was on several cold medications and pretty much dead-tired so I need to give that another viewing. Managed to pick up 300 and Bourne Identity for 10 bucks apiece at Hollywood video over the weekend, bringing my collection of soon-to-be-collectors item HD DVDs to eight.

My home theater PC is shaping up a little at a time. So far I’ve got it into my entertainment center, hooked up to my Samsung 50-inch DLP via VGA with a wireless keyboard/mouse combo. I ended up cancelling and restarting my Netflix under a different name to get full access to my four PCs again (I’ll be much more careful this time). We’ve enjoyed watching Heroes and 30 Rock from Netflix, video quality is suprisingly good, if a bit soft.

Still having trouble with HD content, be it from sites like KoldKast TV, Miro or via OTA broadcast. It’s the same issue with all content, very jumpy. I have a 512MB NVIDIA 7600 card so I don’t think it’s the graphics card. The only other thing I could think is I need more than the 1.5 MB RAM I have or that the 2.8 GHZ P4 I’m running is just too old to take it (the machine is probably 4 years old). Meanwhile my other PCs are torn apart while I “borrow” pieces to see if I can get this one running, since it’s the only machine with Windows Media Center in it. My next step is to take one of my bigger machines that have more RAM and put the TV tuner card in and just see if I can get HD content working in those. If so, I might just order a copy of Vista Home premium to get the Media Center feel.

If you’ve had experience with HD on PCs and have a suggestion, drop me a comment.

New source for HD video on the web and the iPod Touch

Couple quickies today:

First, I came across a piece recently about a new video service on the Web called Miro (it used to be the Democracy player). It’s an open source desktop application that works a little like iTunes. I haven’t had a ton of time to play with it yet, but I was able to download some HD content and it looked pretty good.

Basically there are channels that you can subscribe to, as well as being able to pull in video from YouTube, Google, etc. It looks very interesting, I’ll give a more full report in a little bit after I’ve had time to experiment more.

Second thing is I got an iPod Touch yesterday, the 8GB variety. I’m holding out hope that the rumors of a price drop on the 16GB and the removal of the 8GB will happen in the next 30 days so I can swap them out, but to be honest the extra 8GB is not essential to me.

So far I’m enjoying it quite a bit. I’m going to treat the 30 days as a trial period to make sure I’ll really take advantage of all it offers. So far I’m loving the instant access to the internet and email, and the video quality looks good but I haven’t watched anything yet of length.

Two things that popped out to me as things the iPhone has that the Touch doesn’t; a speaker (so no showing people YouTube vids without headphones) and a camera to easily add faces to the contacts. The Google Maps feature that allows you to pinpoint your location also doesn’t work, although Google Maps works just fine. That feature seems more of a cool to show people item than something really useful unless you travel a lot.

More on this as I get used to it. If you have a Touch (or an iPhone for that matter) let me know some of the cool apps you’ve downloaded and some tips on the best way to get video onto it.