Panel: More Blu-ray education needed

Features such as BD Live to be pushed

By Susanne Ault -- Video Business, 6/16/2008

JUNE 16 | Blu-ray Disc will become mainstream home entertainment, but studio and manufacturing participants at Monday’s Home Entertainment Media Summit in Los Angeles admit they must improve marketing of the format’s benefits to ensure that happens as soon as possible.

With the high-def format war ended, 2008 marks Blu-ray’s best year yet, with all major studios streeting titles in the format. But because Blu-ray still faces discretionary spending challenges from videogames and digitally delivered films, conference presenters said they need to improve their outreach to consumers about such exclusive format advantages as Web-enabled BD Live bonus features.

By 2009, Blu-ray title sales will offset losses of maturing standard-definition DVD, Walt Disney Studios Home Entertainment’s general manager North America Lori MacPherson said during a conference keynote. By 2015, Blu-ray will rank as the most popular way to enjoy movies at home, she predicted. At that time, global home entertainment consumer spending will reach $60 billion, with Blu-ray encompassing 56% of sales; standard DVD, 38%; and digitally delivered content, 6%, according to Disney estimates.

Even with this bright growth curve, MacPherson said there’s serious promotional work ahead.

“We must bring the consumer a transformed entertainment experience. They say they are happy with DVD, but they were happy with VHS too,” she said. “We need to showcase the possibilities of what the technology has to offer. We need to focus on game changing new experiences, like BD Live.”

Gordon Ho, Disney executive VP of worldwide marketing, pointed out that once Blu-ray is actually demonstrated, as in the studio’s recent Sleeping Beauty BD Live consumer/press party, people are hooked.

“It’s that 'Eureka!' type moment,” said Ho. “People were saying [at the event], ‘I did not know that I could do all that with my TV set.’”

He also said that Disney executives are planning how to integrate 3D technology into the Blu-ray experience, further boosting the format’s value. Also on the table is Disney hosting exclusive real-time chats between BD Live-networked users and show talent, such as with the executive producers of TV’s Lost.

For now, however, the Blu-ray consumer is a limited group, NPD senior industry analyst Russ Crupnick said in his session. About 75% of Blu-ray software units are bought by men. Additionally, 45% of software buys come from consumers ages 25 to 34, Crupnick said.

Consumers also are bombarded with other options. In a recent NPD study of DVD purchasers and spending habits, respondents said they spent 36% of their discretionary income on movie tickets; 30% on videogames; 21% on DVD; and 13% on music.

Additionally, the family-geared Wii has engaged new consumers with videogames, previously a mostly male-skewed pastime. In 2007, 23 family videogame titles were released, which is more than double the output in that category from 2006, according to NPD.

“There are people who’d be spending time with movies on a Saturday night who are now spending it with their game consoles,” said Crupnick.

Yet the Blu-ray message is getting out, conference participants said. This year’s outreach efforts have included a Disney mall tour as well as 20th Century Fox Home Entertainment’s Alvin and the Chipmunks mall outing. Panasonic is pledging to push the format through its technology sponsorship of August’s Summer Olympics.

“When we talked to the consumer eight months ago, they were still figuring out what they needed to go with their high-def TV,” said Ho, acknowledging the Blu-ray and HD DVD confusion. “And now they are saying, ‘We are going to get a [Blu-ray] player but it’s just a matter of when. This summer? Or this Christmas?’”

Panasonic has sold more of its Blu-ray hardware in 2008 than in 2006 and 2007 combined, added Eisuke Tsuyuzaki, the company’s VP of corporate development.

Tom Adams, president of Adams Media Research, said that today, 80% of U.S. PlayStation 3 users are playing Blu-ray movies on their console. That has improved from 53% in September.

Also, in the next several years, penetration of Blu-ray set-tops within HDTV households will expand from about 5% in 2008 to more than 50% in 2012, Adams predicted.

In a sign of Blu-ray’s wide appeal, family titles are beginning to find audiences on the format, Adams said. With Disney’s Enchanted, 3.1% of its total $140.35 million in consumer sales came from Blu-ray copies, he said. Yet there is some room for improvement to capture Moms and Dads, as younger-skewing I Am Legend’s Blu-ray portion accounted for 9.3% of its total $121.72 million in revenue.

“It’s more important now to get beyond that early adopter,” said Adams.