Why HD-DVD and Blu-ray are dead on arrival

There’s a certain amount of irony in the fact that one reason why the entertainment industry is pushing these new DVD formats is because of the DRM that more effectively frustrates counterfeiters but when you think about it the best way for the entertainment industry to eliminate piracy would be invest heavily in broadband deployments and on-demand delivery of content. Not only would they have a pricing model decoupled from the physical economics of producing and distributing a disc, but they would also be able to price counterfeiters out of the market and grow consumption at the same time.

Why HD-DVD and Blu-ray are dead on arrival. – By Sean Cooper – Slate Magazine:

The movie studios and electronics manufacturers think—wrongly—these new high-def formats will extend the market for home-entertainment media indefinitely. Both formats will fail, not because consumers are wary of a format war in which they could back the losing team, a la Betamax. Universal players that support both flavors of HD should appear early next year. No, the new formats are doomed because shiny little discs will soon be history.

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6 thoughts on Why HD-DVD and Blu-ray are dead on arrival

  1. That’s geek tunnel vision. Middle America doesn’t move that fast! It’s going to be a long time before the majority of homes can download HD quality video within hours as opposed to days. There isn’t going to be some revolutionary leapfrog event. As the cost of the HD-DVD and Blue-Ray players come down, they’re going to fill a market need for years until fiber to the home is a reality.

    As a proud owner of two new Blu-ray DVD players and a 3rd on the way (in the PS3), I will say that the quality jump is amazing and it’s the movie theaters that may be screwed!

  2. The movie theatres have really been the ones to suffer as home theatre took off. Why go to a movie when you can watch it at home without all the other people screwing it up for you (and $5 popcorn)?

    Byron, I think you might be suffering from a little geek tunnel vision yourself if you don’t consider that DVD sales have been declining as a result of on demand (Comcast alone has 20 million digitals subs). HD isn’t going to revive that when the investment in equipment (not just player but also display) is significant and the bulk of broadcast content still isn’t HD native. You and I are the fringe… I remember paying $700 for a DVD player just a year and a half ago that had up conversion (okay, it also has a 160gb hard drive and a burner) knowing full well that today it is 1/2 that and blu-ray is even better.

    The PS3 is an interesting development, I wonder how many people even realize that they can play movies using this device. I think Sony and Microsoft both made strategic errors in not marketing these devices as entertainment systems instead of game consoles. Also, I wonder how long it will be before we see mass market ipod video to display accessories achieve mass in the market and make Apple a market share player in movie distribution.

    My point in this post is that while it’s all well and good to invest in and promote HD DVD and Blu-ray, the entertainment industry has more to gain by investing in broadband technology and on-demand business models. Having said that, it’s not one to the exclusion of the other.

  3. According to an article in Revenue magazine on the adult affiliate business, VHS became the default because it was the format that the porn industry decided to use. So you might look to them for the direction these format wars are taking (although they presumably have less clout with everything online).

  4. The adult content business really isn’t driven by display quality and in terms of distribution they have pretty much figured out that online is far better than anything else for them, not just from economics but also in terms of business practices when their customers strongly prefer anonymity.

    BTW, the Dept of Justice just came out with their study on online porn (this is the one that Google fought them about). The results are that only 1% of websites feature porn and 6% of online searches are for adult content keywords. This was a surprise to me as I figured their content footprint was much higher.

  5. Pingback Digital downloads will be Blu-ray’s downfall | Venture Chronicles

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