HD DVD bow bedevils retail
Info scarce from Toshiba, confusion aplenty
By Susanne Ault -- Video Business, 3/3/2006
MARCH 3 | With only weeks to go before the first HD DVD players and movies are slated to hit stores, retailers are finding information about the launch sketchy and, when it is provided, often contradictory.
As a result, even some stores recruited by format-backer Toshiba to participate in the kick-off are finding it difficult to put together a coherent merchandising strategy for the new high-definition format.
“We’re getting different stories,” one entertainment specialist told VB. “We had two vendors within two hours tell us two different things about the availability of [high-def products]. We do sell some hardware, and we’re trying to get hold of some of the players. And we want to know where the [software] units are and what that allocation will be. But what we’ve heard is slim.”
Although the initial rollout is planned to target electronics retailers more than entertainment specialty retailers, even some hardware outlets are finding information scarce.
“Customers will be more comfortable with the player when they see software for it,” said Frank Roshinski, VP general merchandise manager of Tweeter’s video division. “We’re not completely sure on pricing and availability. We went back to Toshiba and asked them to give somebody a push.”
Roshinski doesn’t understand why studios aren’t bundling players with free HD DVD software, similar to how studios launched the standard DVD format.
He and others blame the high-def format war for the information hodge podge.
“It’s polarized between the camps, and info is at a premium,” Roshinski said. “No one wants to show what cards they are holding.”
Toshiba kicked off a 50-city retail demonstration and promotional tour for HD DVD on Feb. 21.
The tour, which runs through April, features Toshiba’s first two HD DVD players, the HD-A1 ($499.99 list) and the HD-XA1 ($799.99).
Although the demonstrations have been well-reviewed by many home theater enthusiast Web sites, the only content available to demonstrate the new players at the events has been a promotional disc put together by Toshiba featuring clips of Warner Home Video’s Dukes of Hazzard and Universal Studios Home Entertainment’s King Kong.
The first batch of Warner titles are scheduled to street on March 28, the same day the players officially go on sale.
Plans call for the limited number of discs available at the launch to be allocated primarily to retail outlets stocking the hardware, but two weeks into the road show, retailers were yet to be told how many discs to expect, when they might arrive and what the suggested list prices will be.
Store managers believe the absence of complementary software is undermining promotional buzz.
Following several Toshiba events, Tweeter has rung up 40 to 50 pre-orders for HD DVD players. But the chain has been unable to take pre-orders for the software because details have yet to be provided by Warner.
Warner executives declined to comment.
Tweeter normally doesn’t carry DVDs but hopes to offer HD DVD titles through the 2006 holiday season.
As of last week, Wal-Mart, through its Web site, was one of the few retailers taking pre-orders for Warner HD DVDs.
The majority of posted titles, including Warner’s initial March 28 wave Batman Begins, Twister, Lethal Weapon, Constantine, Million Dollar Baby, among others, are listed at $29.98. Walmart.com is selling each at $25.48.
“It’s too early to gauge customer demand,” Walmart.com spokeswoman Amy Colella said. “But we began offering some high-definition titles several weeks ago.”
Despite Warner’s plans to restrict the software to hardware outlets, Walmart.com doesn’t appear to be taking pre-orders for Toshiba’s HD DVD players. The retailer did not respond to questions about the hardware.
Hardware retailers blamed the studios more than Toshiba for the lack of coordination.
“[Toshiba] is definitely supporting the events with people and marketing help,” Ultimate Electronics senior VP merchandising Jim Pearse said. “We’ve taken out full-page ads in local papers and done direct mailers [to advertise] demos.”
Toshiba didn’t return calls for comment.
Entertainment specialty retailers acknowledge they are not a priority for HD DVD. But stores are nevertheless upset by the lack of information from studio reps.
One regional chain buyer bemoaned, “I still know nothing about HD, and I haven’t been presented with anything.”
Several retailers are planning to conservatively stock first high-def titles once they become available. Tweeter is looking to order four to six copies each of the bigger movie releases per store, Roshinski said.
Stores also seem measured about consumer reaction.
Amazon.com is letting people sign up to receive e-mails the instant the retailer can offer pre-orders on HD DVD titles.
“It’s still very early,” Amazon.com spokeswoman Jani Strand said. “While consumer interest in high-def is strong and growing, it’s still considerably less than the demand for popular DVD titles.”
Among the site’s most requested HD DVD titles are The Lord of the Rings Trilogy, The Matrix and Harry Potter and the Goblet of Fire.
Indie supplier Goldhil hopes to triumph over confusion by widely offering both HD DVD and Blu-ray versions of Chronos on March 28. Listed at $24.98 for both formats, Chronos explores such global monuments as the Egyptian pyramids. Amazon.com and Target.com are among those accepting pre-orders for the title.
“We don’t have any agenda except to deliver the product to the market,” Goldhil chief operating officer Paul Culberg said. “We believe there are sufficient people who will jump for the bragging rights to have one of the first HD programs.”
