HD DVD Player Sales Grind To a Halt

Lucas123 writes "While the news may fall under the 'Duh' category, it's still relatively shocking how quickly the death knell for HD DVD player sales came on after Warner Bros. announced they were dropping dual hi-def DVD format support in order to back only Blu-ray. According to a Computerworld story, the week after Warner's announcement, sales of HD DVD players dropped to 1,758, down from 14,558 players the week before. In contrast, consumers bought 21,770 Blu-ray Disc players, up from 15,257 the previous week."

Comments

"blue ray player" totals

[damn_registrars]

Previously, I had heard that the total sales for blue ray players included sales of PS3 consoles. Are they included in these numbers as well? I know that there are certainly people out there who bought PS3's with the intention of playing PS3 games, and didn't really care that they could play blue ray movies as well.

That said, of course the loss of another studio from HD DVD to Blue Ray likely didn't hurt sales of stand-alone blue ray players, either.

Re:"blue ray player" totals

[Moonpie Madness]

I hear this line a lot. Why does it matter?

If you count the PS3s, then you also increase the denominator when determining the ratio of players to media purchases, the attach rate.

I think the only honest way to report on blu-ray is to include PS3s and accept a lower attach rate (if there is one). Frankly, most blu-ray players are PS3s, and it's simply an obvious selection for those who aren't interested in video games, so excluding it is insane.

I know of several PS3 owners. Some of them only have the free blu-rays. Fair enough. None of them are unaware of the HD disc abilities, but some just don't watch movies. The statistics reflect this reality, so I see no reason to adjust things strangely.

Re:"blue ray player" totals

[Moonpie Madness]

Anyone know if the blu-ray folks were similarly inconsistent? Excluding the PS3 when discussing attach rate? Seems unlikely to me.

The HD-DVD campaign failed as soon as it became evident the PS3 was not going to flop, at least that's my view of the situation. When the PS3 looked doomed and 600$, it wasn't hard to believe that the HD0DVD camp would prevail.

But how do you compete with the PS3? It's not that expensive next to a great TV and movie collection, and it does all that media stuff + is a future proof blu-ray player. Almost unfair. I wonder why the 360 didn't come out with built in HD-DVD? I beleive it HD-DVD would have dominated had that been the case.

Re:"blue ray player" totals

[AvitarX]

PS3 has been more than doubling that number

So no, it does not include the PS3.

What I find most interesting though is the loss of about 7k sales overall. That would be the cost of a more expensive format.

I personally am happy blue ray wins (I want 50GB burnable disks, not 30GB). But I would have been pretty satisfied to see Sony lose to just because I like to see big companies fail when pushing things to hard (I guess Toshiba pushed pretty hard too, but they keep to quite for it to be as enjoyable).

Re:"blue ray player" totals

[samkass]

I think the only honest way to report on blu-ray is to include PS3s and accept a lower attach rate (if there is one).

I generally agree, but there might be more illuminating ways to break it down. There are PS3's that are sold packaged with movies. An 'attach rate' that counts those but not PS3s sold with game packages might be interesting. Also interesting might be the 'attach rate' counting sales of the PS3 Blu-Ray remote control, which while not required is probably a high-priority item for people who bought the PS3 largely to play media.

But in the end, I'm not sure the immediate attach rate matters much. A lower attach rate means higher opportunity, since I suspect most PS3 owners will buy at least one Blu-Ray movie just to see what all the fuss is about and the existing attach rate is less than 1.0.

And with Sony selling more PS3s per quarter than HD DVD players have ever been built (is that statistic still valid?) the sales of standalone players hardly matters anymore.

Re:"blue ray player" totals

[orclevegam]

I didn't mean to imply that MS made a mistake by opting not to bundle the HD-DVD player with the 360. It was just pointing out why it was that MS made that decision, but Sony didn't. Essentially Sony was using the PS3 to boost Blu-ray sales and help out some of their non-gaming divisions. To a certain extent it's obvious why MS didn't feel particularly motivated to push HD-DVD. Even though they would profit some, being one of the backing companies for the format, not being a hardware manufacturer (to any real extent) they actually have little profit motive, and they also know that the biggest money maker on their console outside the games themselves is the online content of Live. Bundling a HD-DVD player would have just jacked up the price and reduced console sales. They would very likely never see an adequate return on investment from that strategy even if it had lead HD-DVD to dominate. Sony on the other hand, had they not bundled Blu-ray with the PS3 might have seen better sales of the PS3, but would take a hit selling Blu-ray DVD players.

Re:"blue ray player" totals

[samkass]

Thus it's ironic that Blu-Ray is a much more open format than HD DVD. Blu-Ray interactive media is based on the Java language, which is going open-source (although BD-J-specific JVMs aren't yet), while HD DVD is based on the Microsoft-controlled iHD standard. Blu-Ray encourages the use of MP4/AAC instead of HD DVDs Microsoft-controled VC-1 (although both formats support both, the authoring tools for each push studios in specific directions). And the PS3, the most prolific Blu-Ray player on the market by far, has "install linux" as a menu item out of the box. Sony doesn't even hold the most patents on Blu-Ray, so the IP situation is more diversified.

Anyway, I never bought a memory stick or PSP-format game, but Blu-Ray seems to be closer to Sony "getting it".

Re:"blue ray player" totals

[Troed]

Correct me if I'm wrong

OK.

http://en.wikipedia.org/wiki/Blu-ray_Disc

Re:"blue ray player" totals

[MsGeek]

MS was BRILLIANT in not bundling HD-DVD with the XBox 360. They can now quietly put out a plug-in Blu-Ray player for the box and catch what's looking like a tsunami for Blu-Ray.

HD-DVD will be the RCA SelectaVision of the high definition DVD-like disk era. Remember those? Flimsy 12" disks encased in a plastic carrier and read by a stylus, they'd fall apart after a few plays. This allowed Pioneer to own the videodisc market with LaserDisc.

Heh, Sony has gotten its revenge for Betamax.

Re:"blue ray player" totals

[twistedsymphony]

...then they turn around and offer kits to install Linux on PS2s and even support Linux out of the box on a PS3

That's a different situation entirely... A group of console/linux hackers basically held Sony hostage saying that they cracked the console and if Sony didn't offer an official Linux distro they'd go public and open the door to pirates as well. Sony obliged and we got an official Linxu distro. The same group did the same thing to MS over the Xbox 1, MS denied and the console was cracked wide open to the point where it can be used as a fully functioning PC with little more than a screwdriver and a soldering iron.

Even still the PS3 does offer more open standard support than their competitors. You can use Generic hard drives, generic bluetooth devices, generic memory units, generic usb devices, etc. while it's mostly proprietary on the 360 and Wii.

Sony's Biggest folly IMO is their abhorrent lack of organization both blu-ray and the PS3 in their release configurations were running on un-finalized specs, blu-ray is just now finalizing it's spec and basically obsoleting most of the early players, and disc releases and the PS3 still feels incomplete and probably wont feel "finished" until the release of home/full integration of the x-media bar. At least the HD-DVD spec was finalized and all the players and media supported that spec on day 1.

Re:"blue ray player" totals

[orclevegam]

Eh, the gaming market is a very interesting animal. The short product life-cycles, combined with the limited competition, large costs, and proprietary nature of the products, plus the added confusion of customer and developer loyalties and tastes makes it very hard to make any accurate predictions.

Just as a quick example take a look at what's happened to Nintendo over the years, particularly the last two generations of consoles. Nintendo went from the top contender with the SNES, dropped to second with the N64, and then trailed a distant third with the Gamecube, only to make a surprise comeback with the Wii. Prior to it's launch no one was really certain how the Wii would do, and in fact many of the top analysts were predicting that it might be the system that finally killed Nintendo. Obviously looking at just the raw specs for the system it doesn't look like much of a contender when put up against the likes of the 360 and PS3. But there's more to it of course then raw specs, as the Wii's surprise success has shown.

As for the developer relations MS earned with the 360, I don't know. It definitely won't hurt them I think, but time will tell if the sacrifices they made rushing the 360 to market (most obvious seems to be the ridiculous 30% defect rate) was worth it or not. It may turn out that could have gotten the same result by simply bribing developers, but then again, maybe not. One things for certain, the choices that Sony made up till this point definitely don't seem to be working in their favor, but of course they still have plenty of time to turn it around and prove all the doubters wrong. It will be interesting to see if after the dust settles on this and Blu-Ray is declared the winner of the format war, sales of PS3s will pickup.

one week

[Anonymous Coward]

And as the article points out, the information from that week is useful to gauge sales for that one week only. Since Toshiba responded the following week with massive price cuts, the sales figures will be drastically different for the following weeks. Basically, these numbers will be all over the map for a while, and won't be useful for generating any sort of trend. That said, it is clear that HD DVD will be going away soon.

Re:one week

[Moonpie Madness]

Good point. If I was going to buy HD-DVD, I might wait fo rthe obvious price drops that are sure to come as HD-DVD liquidates away.

But the overall point, that this format war is over, stands. Toshiba has to get what they can, and will have sales and such, but it's over.

Poor Bastards

[LearnToSpell]

And that's why the rest of us wait for format wars to end.

Re:Poor Bastards

[MacarooMac]

or two true ways, for features running over 120 minutes ;)

Re:Poor Bastards

[pragma_x]

And that's why the rest of us wait for format wars to end.

Exactly.

I simply sit in the trench and wait until the cacohpany of cash registers and emptying bank accounts comes to a halt. I then peer out from my fox-hole and look to see the vast wasteland around me: HD-DVD players being thrown out by the dozens, consumers with smoking holes in their wallets, and the wreckage of packing waste and store displays strewn about as if by some hurricane.

Somewhere, distant as if on the wind, I can hear the quiet sobbing of some videophile, lamenting the death of his preferred format.

Format war is hell.

Re:Poor Bastards

[richardellisjr]

No the disc don't stop working, but when your HD DVD player does in 5 years they may as well not work.

Don't Count HD-DVD Out Yet

[ergo98]

During the week following Warner's announcement -- a period in which the HD-DVD group went into hiding while they regrouped -- FUD went absolutely rampant. Eclipsing the damage of Warner's announcement were rumors from so-called insiders that Paramount and Universal were also jumping ship, along with the standard claims that the adult industry was going blu. If you do a news search on HD-DVD right now you'll continue to find the same FUD, blown into a life of its own by blogger referencing blogger referencing blogger, repeating the same disproven claim.

In this vacuum of information, there's no surprise that HD-DVD sales collapsed, and it isn't because of the loss of Warner's catalog.

Since then the outcome is much less certain, however. Toshiba hasn't just conceded (and they shouldn't -- just prior to Warner's announcement it was 50/50), but instead they've come out swinging, dropping the price of their units by half (obviously it has to be cheap to compete with a format that largely was acquired for "free" as an added value of a game system). This price puts a very capable HD-DVD player with ethernet, HDMI, optical audio, and so on, as cost competitive with a decent upscaling DVD player -- and the Toshiba unit is a very good upscaling player. Add the 7 or more free HD-DVD movies that'll work forever even if HD-DVD dies, and a catalog of 1000 or so HD-DVD movies already on the market, it's a hell of a deal. If someone could hack this baby to be a media head unit it would absolutely own.

Reports are that sales have been absolutely massive, and Toshiba's campaign has been a success. Warner since has extended their HD-DVD support by almost a month, and other very positive rumors have circulated about HD-DVD.

Don't write HD-DVD off quite yet.

As an aside, one thing that really pisses me off about this war are claims that the end of the format war would be good for consumers. This is as logical as saying that Windows and IE should be universal -- good for consumers. Worse, Blu-ray has so many consumer-unfriendly facets (cost, no combo discs, a standard that's still in flux, early adopters getting screwed, the nebulous DRM of BD+) that it winning can never be perceived as a consumer win. Yeah, I'm biased because I didn't choose a format to win based upon a game unit I happened to buy.

Re:Don't Count HD-DVD Out Yet

[Anonymous Coward]

As an aside, one thing that really pisses me off about this war are claims that the end of the format war would be good for consumers. This is as logical as saying that Windows and IE should be universal -- good for consumers.

That's not even remotely the same thing. We're talking about formats here - interoperability is the important thing here. The analogous situation wouldn't be a universal Internet Explorer, it would be a universal HTML format. The competition between web browsers is reflected by the competition between player manufacturers.

Do you think the world would be better off with a version of HTML that only works in Internet Explorer and a version of HTML that only works in Firefox? Because that's the type of situation here.

Re:Don't Count HD-DVD Out Yet

[Kohath]

Add the 7 or more free HD-DVD movies that'll work forever even if HD-DVD dies...

Until your player stops working in a few years, as all electronics eventually do. And then you won't be able to get a replacement HD-DVD player.

...and a catalog of 1000 or so HD-DVD movies already on the market...

There are 378 HD-DVD movies on the market.

Re:Don't Count HD-DVD Out Yet

[sheldon]

Until your player stops working in a few years, as all electronics eventually do. And then you won't be able to get a replacement HD-DVD player.

Considering a search for 8-track player yields 371 results over at ebay right now, I'm not sure that is a huge problem.

Re:Don't Count HD-DVD Out Yet

[prisoner-of-enigma]

Imagine if every media company released every disc in DVD, Blu-ray and HD-DVD (the cost to them is marginal.

And you have access to pricing figures for the studios to back up this "cost to them is marginal" argument, I would assume? Of course you don't. Such data is not published. Your are speculating out your wazoo, and you are wrong.

HD-DVD's most-trumpeted advantage is its ability to make use of existing DVD production facilities with only minor refits. No need to scrap the entire production line, you just upgrade it a bit. Blu-ray is fundamentally different in disc construction and has no such advantage. This was a conscious choice on the part of Sony. They sacrificed backwards compatibility of production equipment to get a more advanced disc structure. In this they have succeeded, as Blu-ray has scaled to 200GB capacities on an eight-layer disc in the lab. HD-DVD has scaled to 51GB with triple-layer discs in the lab. There is no comparison.

Studios that produce in both formats have to pay production houses to stamp them. The production houses have a choice of going exclusive with one format or gearing up to produce both.

The former situation requires the studios to negotiate separately with two production facilities, but (and here is the key) they're effectively splitting the number of discs produced in half for each facility. This hurts the studio's buying power just like it would hurt anyone else: more quantity equals lower prices. For disc production this is particularly acute because there is a very high cost to create the line to produce even one disc. The more discs you can stamp on that line, the cheaper it gets on a per-disc basis.

The latter situation requires the production house to foot the bill for two very different (and mutually incompatible) production lines. This is no small cost, and that cost is passed on to the studios when they order a run of discs.

So, no matter how you play it, your statement that "it doesn't cost more to do both formats" is completely without merit. It does cost more, more to author (HD-DVD and Blu-ray authoring tools are both incompatible and very expensive), more to produce (as outlined above), more to distribute (remember, two different kinds of packaging), and more to stock (there's only so much shelf space in stores).

This kind of lets the air out of your whole its-a-corporate-conspiracy argument, doesn't it?

Odd numbers

[Aladrin]

So, HD DVD lost 13,000 sales and Bluray only gained half that? I think maybe there's something else going on as well other than just the Warner deal.

It's over

[$RANDOMLUSER]

I think this says it all.

DVDs Still Work Just Fine

[blueZhift]

I'm no crotchety old man pining away for the the good old days, but it seems to me that DVDs are still working just fine. The format wars are a sometimes interesting diversion, but until HD TVs are the norm and DVDs leave the market altogether, the format war is largely meaningless to most. My SD TV works just fine and until it stops working and/or HD comes down in price another $500USD or so, Blu-ray vs HD-DVD is a nonissue for many if not most. Oh, and that says nothing about digital delivery making physical disks totally irrelevant.

Re:DVDs Still Work Just Fine

[afabbro]

Not sure about digital delivery, but the fact is that consumers are not going to replace their home libraries they way they did when they went from VHS->DVD (or tape/LP->CD for that matter). End of story. Without that, a new format really doesn't mean much in terms of economic effect for companies.

When my DVD player burns out, I'll buy an HD player if it's the same price and plays my existing DVDs. After that, maybe I'd buy some HD discs. Otherwise, I'll just keep waiting. That's the attitude of 99.9% of consumers.

Take with a grain of salt or two...

[Wdomburg]

The folks at NPD have already said not to make too much of these numbers. Not only do they reflect a single week of data immediately following the Warner announcement and prior to Toshiba cutting prices in half, there were also free Blu-ray player promotions from Panasonic, Sharp and Sony. Easy to "sell" a lot of units when the price tag is $0.

Re:Take with a grain of salt or two...

[Wdomburg]

Oh, it's also worth noting that all three current Toshiba players (A3, A30, A35) have been in the top ten at Amazon since the price cut.

MS has said from the start that the 360 can switch

[tacroy]

One of the rationals of doing an external player was so that they could just make a blu-ray addon if HD-DVD didn't win. The main difference is that blu-ray and the PS3 are intimately intertwined. However, the 360 is just a video game machine that you can buy an add-on movie player too. Very few people (that I know of) bought the 360 as a movie player, compared at least, to the apparent many that bought the PS3 for its movie ability. So for all intent the HD-DVD addon, will suffer the same fate as a standalone player, and have little affect on the 360.

DVD still works fine for me

[mattgoldey]

I have a 46" 1080p Samsung LCD with a 1080p upconverting DVD player. DVDs look fantastic on this equipment. I see no value in upgrading to either high-def format - especially considering the price of the media. When I can get a brand new DVD for $15 or a gently used one for under $10 and the high-def format discs are still $25 or more, color me uninterested.

I don't think that's it's a foregone conclusion that either format is going to win out. Look at what happened to SACD and DVD-Audio.

Favorite Civil War Quote

[Chabil Ha']

It is well that war is so terrible - otherwise we would grow too fond of it. --Robert E. Lee

Re:I bought a PS3, and only for HD movies -nt

[Stamen]

I pretty much did the same thing, I bought the PS3 mainly for the Blu-Ray. Why is this having "a lot of cash to burn"?

I wanted a Blu-Ray player, and the PS3 was only $80 more than a pure player, and it got good ratings on the quality of movie playback. I figured the extra $80 was worth getting a game console and media center thrown in. Seems like good economic sense to me.

Re:I bought a PS3, and only for HD movies -nt

[aplusjimages]

Getting the PS3 for a Blu-Ray player is smart because not too many Blu-Ray players have ethernet connections to update the firmware, but the PS3 does.

I would have liked to see if these numbers were just for the US. What about worldwide where these exclusive deals don't matter?

Self fulfilling prophecy?

[Pr0xY]

I kinda feel like it wasn't the Warner Bros. announcement that did it, but more the reaction by the geek community to it. After the announcement, pretty much everyone in the geek community who cared immediately declared Bluray the winner. To me, this had way more impact than the loss of Warner Bros. Because it causes a chain reaction of "information" being spread all over the internet how HD-DVD is dead. So now, when consumers try to do some research on HD-DVD they find blogs and articles all saying Bluray is the winner. I would also imagine that this also effected sales reps in places like BestBuy where you have pseudo geek employees repeating all stuff they read on the internet to there customers.

All in all, this is a formula for a runaway sales drop in HD-DVD. Which to be honest, I am happy about, I _want_ there to be a winner (though I wish Sony didn't benefit from it...). But now I am getting to the point where I don't feel a purchase would potentially be for the losing format.

So in the end, I think that enough people said it was happening to the point where it made it happen.