OPINION: No high-def winner yet
By Paul Sweeting -- Video Business, 2/23/2007
FEB. 23 | WITH ALL DUE respect to the folks at Sony and other Blu-ray Disc backers, it seems a bit early to be declaring victory in the high-def format war.
Paul Sweeting is editor of Content Agenda
The latest evidence for their claim is the ratio of software sales in January, when BD movies outsold HD DVD movies by 2-to-1. But the number of titles released on Blu-ray last month outstripped titles released on HD DVD by better than 2-to-1, so the greater total software sales—by itself—doesn’t tell us much about BD’s relative popularity.
Moreover, BD software sales in January also likely benefited from the 600,000-700,000 PlayStation 3 consoles sold in the U.S. in December, each of which came packaged with a $15 coupon for a BD movie.
We won’t know whether that PS3-propelled spike in sales will be sustained until we have a few months-worth of data.
If you look at lifetime data of the two formats, total software sales are about even, while BD has nearly a 5-to-1 lead in the installed hardware base if you include PS3 consoles. That suggests the overall attach rate of discs per player is far lower for Blu-ray than for HD DVD.
Insofar as PS3 is considered critical to the success of BD, in fact, it’s hard to see why anyone in the BD camp is feeling optimistic.
THE REAL NUMBERS story in January was not the strength of BD but weakness of PS3.
Sales of Nintendo’s Wii nearly doubled those of the PS3 in the month, while Microsoft’s Xbox 360, despite being on the market for more than a year, bested Sony’s console by 20%.
Even Sony’s own PlayStation 2 outsold the PS3.
Since their respective launches, in fact, the Wii has zoomed by the PS3, selling more than 1.5 million players in the U.S., compared to 933,000 PS3 consoles.
The Xbox has piled up sales of 4.8 million since launch.
PS3 sales have been slowed by (BD-induced) production delays, of course, which, presumably will be resolved. But I don’t see why that should bring any comfort to BD supporters.
For PS3 to be a decisive factor in the high-def format war, it first has to succeed in the game-console wars, and right now, it is not.
Apart from being caught flat-footed by Nintendo in the U.S., Sony seems to be going out of its way to limit its success in Europe and Australia.
With the PS3 set to launch in those territories March 23, Sony let slip this week that recent tweaks to the European model will severely limit the console’s backward-compatibility with PS2 games.
“Rather than concentrate on PS2 backwards-compatibility, in the future, company resources will be increasingly focused on developing new games and entertainment features exclusively for PS3,” Sony Computer Entertainment Europe president David Reeves told Reuters in a statement.
That means gamers will be limited to the 25 or 30 PS3 titles Sony expects to have available at launch.
For that more limited compatibility, PS3 buyers in Europe and Australia will have to shell out the equivalent of about $790 for the high-end PS3, compared to $599 in the U.S.
The high-end Xbox console sells for about $390 in Europe; the Wii for about $240.
While PS3 pre-orders in Europe are high, getting beyond those early enthusiasts is likely to prove daunting with a console that’s twice the price of its competitors.
The longer it takes PS3 to reach mass market numbers, moreover, the longer Sony will continue to bleed cash on the consoles, further undermining its competitive options.
SONY’S PS3 PROBLEMS, of course, do nothing to help HD DVD land more studios. The format’s supporters, in fact, seem to be turning to new gimmicks to try to lure smaller producers into releasing product on HD DVD.
For instance, Eclipse Data Technologies, a maker of encoders and premastering software for HD DVD, recently announced a free upgrade that will let its customers master titles in the 3X DVD configuration, which marries the HD DVD file format and copy-protection with a standard red-laser DVD.
“We want to give our customers a low-cost way to experiment and learn the process,” Eclipse VP of sales Bob Edmonds said.
Using the VC-1 or H.264 codecs, the 3X spec allows for up to 135 minutes of HD DVD content on a DVD-9.
Similarly, DCA Inc., recently announced that it had successfully mastered and replicated the industry’s first 3X DVD-ROM disc at Sonopress’ replication facility, part of a joint project with Sonic Solutions.
“Several manufacturers are looking to 3X DVD-ROM as a low cost entry into the HD video market,” DCA said in a statement.
Whether that will be enough to rescue HD DVD from oblivion remains to be seen.
