Blu-ray Set to Take Over in Europe

While sales of Blu-ray players remains relatively sluggish in North America, sales of the format are heating up in Western Europe. In fact, research company Futuresource Consulting reveals that sales of Blu-ray players are actually ahead of where sales were for the standard DVD format when it was at its same point of introduction into the market.

Futuresource anticipates that more than 10 million Blu-ray players will be in use by the end of 2008. By contrast, only 1.5 million DVD players were in homes by the end of the third year that this format hit the market. Going forward, the company sees Blu-ray performance out-doing DVD consistently, with almost double the growth in year 5; closing at just slightly higher in year 6 (45 million units shipping in 2011 vs. 37 million shipped for DVD in 2002).

Naturally, we have to take the Sony PlayStation 3 into consideration, which is purchased as a gaming system first and foremost, with the built-in Blu-ray player as merely a secondary feature (for the majority of consumers, at least).

"The timing of the PS3 launch has clearly provided a big boost to the initial uptake of BD," explains Jim Bottoms, MD Corporate Development at Futuresource. "With a number of hot titles now starting to emerge and console prices continuing to fall, we can expect to see continued strong uptake."

Bottoms also notes that the competitve nature of retailers trying to get as much market share in the category as they can is also helping sales. Not only are retailers exposing consumers more and more to the technology, but product pricing is also coming down, making Blu-ray a more affordable option to the every day customer.

This is impressive news for the Blu-ray camp. Hopefully, in time, we'll experience the same sort of growth in North America. Bottoms is confident that Blu-ray will eventually "mirror the trend we saw with DVD players replacing CD decks." We may be closer to that time than we think.

HD DVD is Gone, But Has This Really Helped Blu-ray?

It has been more than two months since Toshiba officially announced the end of the high-definition DVD format war by halting production of HD DVD players. The Blu-ray camp sighed a big sigh of relief, and poised itself for an increase in sales. But has Blu-ray really benefitted from winning the format war?

According to a recent study by The NPD Group, it hasn't; or at least not yet. Sales of Blu-ray players actually dropped 40% from January to February in the U.S. From February to March, during the time when the "war" had officially been declared over, there was only a 2% increase in sales.

"That standalone Blu-ray players haven't picked up significantly from HD DVD's loss shows that few consumers were dissuaded primarily by the 'format war'," declared Ross Rubin, Director of Industry Analysis, NPD. "When we surveyed consumers late last year, on overwhelming number of them said they weren't investing in a next-generation player because their old DVD player worked well and next-generation players were too expensive. It's clear from retail sales that those consumer sentiments are still holding true."

I've long said that, rather than focusing on becoming the winning format, both camps should have been more focused on convincing the customer that he needs to upgrade to an HD source, period. Either way, price will remain a factor with budget-conscious customer; not just of the Blu-ray hardware devices, but also software, which are often times almost double the price of a "regular" DVD movie. In fact, I think if the price of software were to drop down to become in line with standard DVDs, more people might be willing to fork over the extra dough for the player.

Interestingly, NPD notes that many consumers who are interested in a better viewing experience are quite content with upconverting DVD players. Sales of these such devices grew 5% during the first quarter of 2008 compared to 2007. Meanwhile, regular DVD player sales dropped a whopping 39%.

Nevertheless, it's only a matter of time before consumers finally pick up on high-definition DVD. Many are already enjoying HDTVs and high-definition TV viewing, so high-def DVD is naturally the next step in the equation. It's also important to note that this study only looked at standalone Blu-ray players: devices like the Sony PlayStation 3 gaming console, which includes a built-in Blu-ray player, has been selling like hotcakes!