As you have read, I am excited by Blu-ray and I don't think it is overhyped. I do think that Sony underestimates how HD delivery of movies on cable and satellite, in an era of larger, cheaper hard drives, will be a market-inhibiting competitor.
That said, I just caught up with the NYT's reporting on Stan Glasgow, the president of Sony Electronics, and his recent NY media meetings (3/5). And I am in more than a little shock.
As I wrote when HD died, Sony must seize the opportunity to make this format fly. People will pay a $5 premium for the discs in return for the clear quality step up. But what is still a major factor in the way of the growth of the market into double-digit penetration is the cost of the players. (What makes PS3 the go-to player is the wireless updating of firmware, even more so than the gaming application.)
And here, Glasgow is not only crowing about controlling the market - bad press choice - but making clear that the cost of a Blu-ray player will not drop to $299 until this next Christmas!!! And that's still too high!!!
$199 by 2009! Still too high!!!
Until they deliver a $149 player, the market will continue to limp along, even with increased and singular visibility at retailers. Discs are already being discounted on Amazon and elsewhere, both to keep up with HD discounts and to deal with the price disparity with the ever dropping retail price for regular DVDs.
And really, however threatened Sony might feel about the Chinese knock-off artists, resting on their laurels is no answer. Sony NEEDS to come up with a $150 solution - or a $250 package that comes with 10 Sony Blu-ray DVDs - by the end of THIS summer.
They don't seem to understand the lesson of Apple and the iPod. Yes, it's great to control the market. But Apple controlled the digital music market by creating; 1. a superior product, 2. ease of use unlike anyone had previously experienced, 3. a sense of real value, both in the somewhat pricey product and with iTunes as a lower cost alternative to overpriced CDs, 4. a range of products within 18 months of the initial release of the product so more people could join the "revolution", and 5. access to the full value of the iTunes platform, even if your new iPod couldn't fit everything you owned.
Sony seems committed to forcing Blu-ray on quality improvement alone. They haven't even adapted the very clever duel format that allowed many HDs to play on regular DVD players as well, so buyers wouldn't feel they were buying something they could only use in one machine on one TV in their homes.
What is Sony's iPod here? The $150 single use machine that also has wifi updatability.
You have to make the product accessible enough that people who are ready to make the leap because of a movie – like No Country For Old Men or The Godfather Saga or the Indiana Jones series or a Shrek box or a Transformers or Criterion titles or whatever – don’t fear making the leap. $400 in an $80 DVD player world is a lot. So is $300.
But say you are going to spend $2000 on a new HDTV. So it’s another $200 for the DirecTV box… another $100 for your Sunday Ticket NFL package in hi-def… at least another $180 more a year for your satellite or cable package in HD… a new piece of furniture for your new TV maybe, $100 for each HDMI cable, maybe a home theater sound system, etc.
Are you really anxious to drop another $400 on a Blu-ray player when a significant number of the titles coming out aren’t on Blu-ray?
The biggest moment for Blu-ray will be Disney launching Sleeping Beauty, their first classic in the format. If Disney could bring them all out for Christmas, that would push things along handily. But they won’t. So parents, who know that their kids won’t know the difference, are less likely to make the leap based on one classic Disney title and Pirates of the Caribbean and Ratatouille and Cars (the only 2 Pixar titles in the format to date). And id Disney goes hi-def with The Disney Channel... well... deadly.
The whole effort would also be well served by people feeling good about buying a Blu for more than one room in their home.
Bottom line: $50 profit on each machine and a large group paying a premium for Blu-ray discs for years is a lot better than $100 profit on each machine and a small group passionately buying Blus and the whole thing being eaten by hi-def on your DVR and satellite/cable in less than 3 years.
This article screams, “We learned nothing from the Betamax or the iPod!”
Boo.
(P.S. Just spent the afternoon with Across The Universe on Blu-ray…a joy… perfect half-distracted/can’t turn away weekend fare, especially ramped up on Blu. Help us, Sony Wan Stringobi!)
