Format Wars: Bold Claims

January 11, 2007

Blu-rayIn an increasingly all too common occurrence, comments from members of the BDA (Blu-ray Disc Association) have overshadowed the actual products themselves. Bear with me, this is a bit convoluted but in the end; we may shed some light on where the two competing formats really stand.

It all started back in October when the North American HD DVD Promotional Group announced HD DVD had “outsold all other high definition formats by a factor of nearly three”. Now obviously those were early figures and the PS3 hadn’t launched yet but the HD DVD Promotion Group cited real, credible, sales statistics in their report, specifically AC Nielsen’s VideoScan. VideoScan for those of you unfamiliar with the service tracks end-user point of purchase sales from a variety of retail and on-line merchants.

Flash forward to CES 2007 where the BDA “declared its victory as the premiere high definition DVD format of choice”. Ok then, that’s it I guess. We can toss out our HD DVD’s and players and thank our lucky stars the format war is over. Yeah right, if only declaring victory made it so. Apparently the BDA’s proclamation of victory heavily relies on a survey of 10k PS3 owners where “80 percent indicated they will buy Blu-ray movies and 75 percent said they use the PS3 as a primary device for viewing movies.”

Well that’s great news for the BDA and Blu-ray in general but you’ll have to forgive me for not packing up my HD DVD player just yet. I have to wonder how many of those PS3 owners will continue to purchase Blu-ray movies on a regular basis. Again I have zero doubt that PS3 owners will buy movies, heck I’m one of them and I’ve bought several myself. None of this however speaks to future plans out beyond the initial curiosity phase.

And then we enter the surrealistic world of 20th Century Fox’s (President Worldwide, Home Entertainment) Mike Dunn; who stated:

“We are looking forward to this pivotal year and the ultimate establishment of Blu-ray as the high-definition packaged media standard. In fact, Blu-ray sales performance surpassed HD-DVD for the first time the week of December 24 and did so by an impressive 20 per cent. What’s more, by the end of the first quarter our research shows the sales gap widening to Blu-ray outselling HD DVD by a 3.5-to-1 ratio”.

At face value those are impressive claims and undoubtedly good news for Blu-ray. Upon further inspection however the attached sales-chart raises some interesting questions of its own. Mr. Dunn indicates that the sales gap will widen to 3.5-to-1 by the first quarter. I do indeed see; that at least according to “Proprietary Fox Research incorporating industry data” the gap does increase to 3.5 but that occurs in 2011.

Is this oversight an obvious typographical error or intentional obfuscation? Hard to say but the graph itself is inherently flawed as HD DVD sales remain virtually flat throughout the entire time-line. I guess Fox would have us believe Blu-ray sales will skyrocket while HD DVD sales remain stagnant. I wonder what that same chart would look like from a format neutral studio?

During a recent CES press conference Warner Brothers indicated they sold two times as many HD DVD’s versus Blu-ray discs in 2006. Again you’ll have to forgive me for placing a little more weight with what a format neutral studio has to say on the subject versus an exclusive. Do I think Fox outright lied here? No but I wish we knew a bit more about this “Proprietary Fox Research incorporating industry data” and why direct VideoScan data wasn’t cited.

Ah but the hit parade carries on over at Fox. While the BDA has already declared victory, Fox’s Mike Dunn, in another recent quote expands his “3.5-to-1 by the first quarter” comment to “By the end of the first quarter, the format war is over”. Ok Mike, I’ll mark my calendar, but what if when that doesn’t happen?

Here is where I’m really going with all this, hardware manufacturers (Sony, Toshiba et-al) don’t decide when formats die, software manufacturers (read studios) do. As long as major studios are releasing HD DVD titles, the format remains viable. Don’t get caught up in the ‘one side has more studio support than the other’ rabbit-hole, because neither format can hold a candle to DVD sales at the moment.

So in essence the real question isn’t whether Blu-ray can knock HD DVD out of the picture but can either Blu-ray or HD DVD make inroads toward DVD numbers this decade. If studies like this one are any indication; then both sides are in for a long bumpy road ahead.



Posted by Bryan Greenway | | Filed Under Blu-ray


Comments

  • Xiang He

    A great read for me. Also I agree with everything you said. Personally I don’t like to see HD-DVD fade away and I hate to see Sony use PS3 as a trojan horse to force Blu-ray into households. I am more disgusted when I see biased studio spin numbers to their own favor. However, this format war looks more and more like the war between SACD and DVD-audio that almost no one even noticed.

  • Xiang He

    A great read for me. Also I agree with everything you said. Personally I don’t like to see HD-DVD fade away and I hate to see Sony use PS3 as a trojan horse to force Blu-ray into households. I am more disgusted when I see biased studio spin numbers to their own favor. However, this format war looks more and more like the war between SACD and DVD-audio that almost no one even noticed.