Retailers cut high-def hardware prices

Supply still tight on both formats as some stores offer discounts

By Jennifer Netherby -- Video Business, 9/11/2006

SEPT. 11 | Some retailers have begun slashing prices on HD DVD and Blu-ray Disc players last week, despite a tight supply of high-definition players that has many retailers placing the machines on back-order.

Chicago-based Abt Electronics is selling Toshiba’s HD-A1 for $437, below the $499 list price, according to the company’s Web site. The higher-end HD-XA1 is selling for $688, well below the $799 list price.

“We try to stay as competitive as possible,” Abt president Jon Abt said. Abt said sales have been strong on the Toshiba players but slower than expected on Blu-ray, which Abt is still selling for the $999 list price.

At Amazon.com, bottom-line Toshiba players were discounted to $404 by third-party retailers, while the HD-XA1 was selling for $659.

Samsung’s BDP1000 player is selling for $799 on the site, down from its list price of $999.

Circuit City is offering 10% off Samsung’s Blu-ray players and pre-orders of Sony’s upcoming player.

“It’s getting more competitive, which I’m surprised because [players] are still hard to get,” said Robert Zohn, president of N.Y.-based Value Electronics. Nevertheless, Zohn said he plans to counter the discounting with his own player promotion.

Some of the price drops could be due to new players that are expected to reach retailers in the coming month. Toshiba is expected to announce a second-generation HD DVD player this week at the Custom Electronic Design & Installation Assn. (CEDIA) tradeshow in Denver.

On the Blu-ray side, Panasonic plans to launch its Blu-ray player priced at $1,299 this month, with the first demo at CEDIA. Pioneer is scheduled to launch its players in October, followed by Sony on Nov. 5.

Not everyone is playing the pricing game. Best Buy has held to the list price on both HD DVD and Blu-ray players, as have Tweeter and Crutchfield.

“I can’t see why you would ever need to discount a new technology,” Crutchfield executive VP of merchandise Rick Souder said. “We generally have more orders than we have inventory for. I know that many have said they are disappointed in sales. I haven’t been.”