Blu-ray, HD DVD: Lower the Price!
With New Year's Day fast approaching, I thought I would dispense with a nice New Year's resolution for the studios producing content for high def media on both HD-DVD and Blu-Ray. As always, my advice is provided free of charge. The resolution, quite simply, is stop with the Buy One Get One free sales or as they are otherwise known, BOGO sales.BOGO sales have been used, IMHO, to pump up sales in given weeks on both formats, as a way to artificially increase the reported sales figures as PR in the format war or to move titles that aren’t otherwise selling. The BOGO sales seem to have started to counter the HD-DVD release of Transformers, for the BDA to show that they still won the sales figures that week as part of their PR effort. Guess what? The BOGO sales are having their effect. Sales of all both HD-DVD and Blu-Ray discs have been doing fairly well, increasing their overall sales numbers each week.
In the past two weeks, the sales ratios have held steady at 61-39 in favor of Blu-Ray. The really good news for fans of HDM is that the past few weeks have shown an increase in the sales of both formats across the board, in part due to sales of hardware, but no doubt in part to the BOGO sales.
Why then should I want them stopped? Because the prices of Blu-Ray and HD-DVD discs are too high to begin with. There would be no need for the BOGO sales if the discs where priced properly in the first place. I would replace BOGO sales with a new msrp for all high def discs, namely $19.99. If the BOGO sales have taught us one thing, it is that people will by high def discs in greater and greater numbers if they weren’t priced so high. I have said it before and will say it again. the HD hardware and software is priced too high. The studios can forget trying to reset the prices of high def software compared to DVD. The movie buying public won’t accept it. It is time for the studios to get with the program and reset their prices to a level that will foster increased disc sales. A msrp of $19.99 seems just about right.
For more high-def news and views, please click: TVPredictions.com.
posted by webmaster @ 4:44 AM
17 Comments
17 Comments:
just seen the venturer hd dvd player on QVC for £169 with 7 free hd dvds 2 in box and 5 to send off for also has a free hdmi.work that out its about £35 for the unit.
that is brill for the consumer.
only down side is i paid £142 for my toshiba hd e1 on ebay 2 months ago,still i feel that qvc are not gonna sell things they feel are losing do you?and you know what the masses on qvc are like buy buy buy.
from what i know 90 percent of the venturer is toshiba so you know its good and venturer have been biulding dvd players and incar entertainment for years.
There are a few reasons behind this move, one is to create buzz and excitement, the other is the effect of putting out a perception that the new format has somehow dropped its price, and that makes the playing units more pallatable to buy. If they can sell more of those, then you have immediately increased your market share on the media. In other words, if an HD/BR player sold for merely $50 would you buy it? Who wouldn't, unless of course the media sold for $175 a piece. If you can't afford to buy the media, then who cares how cheap the player is. Reverse that and say that HD/BR players are now $400 but the media is is now $10 a piece. I bet a lot more people would be willing to buy a new player because the price of a new movie is so much cheaper.
This is a good strategy in the short run since winning the format war is still at stake. The short run goal is to sell as many playing units as possible to maximize your market share. Using a BOGO sale has its advantages over doing a 1/2 off sale. First, BOGO sales, are much more reversable, because the consumer expects the BOGO sale to end where the 1/2 is more of a sign that prices are about to cave in, and a return to previous prices is more difficult to swallow. Also, BOGO sales nearly garuantees at least double the volume for the normal buyer who would have purchased at least one at the regular price, but it also brings in new buyers who would have sat on the side. Because of this effect, using some good economic number crunching you can put together a crude curve (or add a much needed point to an existing curve)showing demand as a function of supply to help "feel" the market to where the true price should be. That will be important in the long run.
In the long run (if you're making both the playing units and the media), it'll make sense to moderate the prices of the media to maximize the profit of each one and keep the players at an affordable price (even if it means pricing it below market price.)Because the winner isn't going to make the most money off of the players, its all about making money off of the media (movies, games, whatever.) Its similar to giving you a new razor with its handle and base and taking a loss on that, because now you'll be selling the blades over and over at a nice profit.
Joe,
I agree totally with you. The players ARE a lot more affordable now, but the movies cost TOO MUCH. I am not going to pay $30 for a movie. I do collect movies and believe I still would do so even if downloads, etc. really were viable for me. I like having the physical copy of the movie and that is just me. But, like you said the $20 price point is about where they should be to see mass adpotion of either BLU or HD DVD. I really don't care which one, even though I only have a BLU player. I am almost on the verge of getting an HD DVD player, because I love movies, not formats. If the movie were to drop to 19.99 or so, then on would be on board totally, regardless of format. I don't think we are too far off from that happening.
My first Blu-ray movies were bought in a BOGO at Best Buy back in March. In other words, they didn't start when "Transformers" came out.
Also, I don't think it's very realistic to hope for a $19.99 MSRP when only catalog DVD releases hit that low of a MSRP. In case you weren't aware, here are some MSRP's of recent DVD releases:
The Simpsons Movie: $29.98
The Bourne Ultimatum: $29.98
Stardust: $29.99
Superbad: $34.95
Harry Potter 5 (2-disc): $34.99
POTC3 (2-disc): $34.99
In the early days of DVD, studios had higher MSRP's of their movies than they do now, and the stores offered smaller discounts on them as well. The typical Univesal "special edition" release was priced around $34.95, and could often be found at Target for around $27.95. Once Fox finally got around to releasing on DVD, their MSRP for both new releases and catalog was $39.95 (same as their Blu-ray releases) and could be found at Target for anywhere between $32.95-$34.95 (I still have my non-anamorphic DVD with only a Theatrical Trailer for a Special Feature of "Hope Floats" that I bought for around $30.99 on-line).
Once one format goes away, and more consumers purchase into it, greater amounts of discs will be sold, and you'll either see the MSRP come down, or retailers offering bigger discounts, or like DVD, a combination of both. Until that time, BOGOs are a dream come true for fans of both formats to pick up titles that you wouldn't have picked up otherwise.
~Alan
The BOGOs do not mean that the discs are priced too high. Sony and Toshiba are paying for them in one way or another in monies to the studios. The only way prices lower is when enough of a product is sold. You cannot wave a magic wand and say I think 20 dollrs is the right price. Its the most ignorant thing Ive ever read.
I have not paid more than about $15 for a DVD in years. I get the new reelases the first week on sale at BB and CC. I rarely buy a 2 disc collectors addition if a single disc version is available as I rarely watch extras more than once but watch the movie many times. I am glad so many of you are for higher prices. I am not.
"I have not paid more than about $15 for a DVD in years. I get the new reelases the first week on sale at BB and CC. I rarely buy a 2 disc collectors addition if a single disc version is available as I rarely watch extras more than once but watch the movie many times. I am glad so many of you are for higher prices. I am not. "
I am not for higher prices... I look forward to the day when I can get new Blu-ray releases for $20 or less, but considering it took years for DVD to offer such prices, I don't expect it for a couple of years yet.
Right now, Blu-ray (and HD DVD) are niche formats, much like DVD was in it's early years. Because of this, studios need to charge more money to help make up for the amount of money spent on putting out a movie on Blu-ray (or HD DVD). In fact, it has been said that a lot of the movies released on HDM (High-Def Media) at this point have not even allowed the studios to turn a profit on releasing these titles. Sure, a movie like "300", "Transformers", etc have, but probably not titles like "The Lives Of Others" or "Casablanca".
Sure, it's possible that either the BDA or the HD DVD people could work together to lower HDM prices next year to try and get people more interested in HDM, but most likely, several things need to happen before you start seeing the lower prices at your store... starting with mass adoption... or at least, more adoption than there is at this time... because as long as HDM is a niche format(s), there won't be as much of a reason to lower prices ((( cough, laserdisc, cough))). To get HDM out of "niche" status, the first thing that needs to happen is:
1: The End of the Format War! As long as there is a format war, there will always be these roadblocks:
1(a): People on the sidelines waiting for a winner. The longer this happens, the more people might decide to just stay with DVD.
1(b): Studios miss out on sales they could make with one format due to people only having one format. Studios like WB and NLHV who have to make two different versions of the film costs them more money, thereby making less money on the release, so right now, studios have less of a reason to lower their releases.
1(c): Retailers make less money on "niche" formats than they do on mass adopted formats (like DVD) due to less people buying them, storing them, and the floor space used for them which they could use on something that sells better for them. Given the format(s) "niche" status, there is very little reason for retailers to compete on prices either like they do on DVD releases. Hence why you see very little discounting from retailers like CC or BB compared to DVD new releases that are often found the first week discounted from their MSRP by 50-75%.
If someone wants lower prices, hope for an end to the format war, and for mass adoption to take place. However, if you are waiting for HDM to get to a $19.99 MSRP, be prepared to wait a while as only some catalog releases and animated/kids titles on DVD retail for that price... that's why I'm going to hope for lowered MSRP's around $29.99 and retailer discounting to give me lower prices! :)
~Alan
JUST GO TO AMAZON.COM THEY ALWAYS HAVE THEM AT LEAST 30% OFF. I NEVER PAY ABOVE $27 BUT THE NORMAL RUNNING IS ABOUT $20. I WILL NEVER GO TO A STORE AND BUY MOVIES AGAIN.
We will have to agree to disagree Al. I also disagree that the format war is the issue. Studies have shown that while the war is a factor, the overwhelming issue for consumers is price, of the hardware and software. Price is the major issue, along with thw fact that most consumders are happy with DVD.
Aren't HD-DUD discs supposed to be cheaper than Blu-ray? That's what the HD-DUD group bragging about since the begining. It needs little adjustment to current DVD lines so cost is much lower than Blu-ray. Haven't seen it come true.
I wish HD-DUD die as soon as possible. It's backwards, and spoils true HDM. The latest release of That's Entertainment by Warner pathetically have the extras in SD only in both HD-DUD and Blu-ray. The reason: Warner produced just one master in order to save money. Limited by the small storage of HD-DUD, it is impossible to have the extras in HD, so they had to have them in SD.
never alone the price its finding the discs that are the problem.
i live in walsall in the midlands uk
i go down town to see what stock is available here is my summary
asda had a good selection of hd dvd near there sd dvds
tesco had 3 copys of spiderman on blu ray and none of hd dvd that was it
hmv had 60% blu 40% hd dvd all hidden in a corner near games
blockbusters had a good selection of blu and a measlie few hd dvds.
woolworths had none.
none that i could find in virgin
all the prices where above £20
so its not just about price its also about finding a market to sell them to the masses at the moment both are useless.
im an hd dvd fan
i buy a lot of blu ray movies if they lowered the price i would own every one
"We will have to agree to disagree Al. I also disagree that the format war is the issue. Studies have shown that while the war is a factor, the overwhelming issue for consumers is price, of the hardware and software. Price is the major issue, along with thw fact that most consumders are happy with DVD."
Studies showed that price of hardware and software were an issue getting people to convert to DVD from VHS, along with the fact that most consumers were happy with VHS.
Prices will go down on hardware, but until HDM becomes something more than a "niche" format, there is no reason for the studios to lower their software prices, and no reason for retailers to discount them that much either. Once the format war ends, more people will jump on the bandwagon, thereby allowing more profit, which will in turn allow the studios and retailers to lower MSRPs and increase discounts for the next round of consumers.
You may disagree with me, and that's fine, but I have history on my side.
~Alan
Sorry Alan the public was ready for DVD over VHS after the success of the CD. DVD offered convenience that VHS couldn't come close to as well as the better picture and sound. That is not the case with HDM. Comparing apples to oranges. If the studios were really serious about imprving sales, they would lower their prices. It seems to me that they are more interested in keeping the price points high as they we unhappy with the margins on DVD. They would simply make more money selling more at a lower price then less at a higher price.
As for Mr. HD-DUD, another in a string of useless comments. Put your agenda , whatever it is aside, and open your eyes. HD-DVD is fully capable of meeting BD in PQ and AQ. As for the prices of the discs at retail, the cost to manufature them has nothing to do with the high cost.
"Sorry Alan the public was ready for DVD over VHS after the success of the CD. DVD offered convenience that VHS couldn't come close to as well as the better picture and sound. That is not the case with HDM. "
When I first got a DVD player, most people thought I was silly to spend that much, and stated that they were happy with VHS... some even stated that they couldn't tell the difference in the picture compared to DVD. Now, everybody I know (with the exception of one) has a DVD player... and I hear the exact same comments regarding my love for Blu-ray. As far as convenience goes, I'll give you that, but as more people get HDTVs, HDM will become more attractive (provided there is a winner).
"Comparing apples to oranges. If the studios were really serious about imprving sales, they would lower their prices. It seems to me that they are more interested in keeping the price points high as they we unhappy with the margins on DVD. They would simply make more money selling more at a lower price then less at a higher price."
If they were more interested in keeping their price points high, then why bother with BOGO sales? HD DVD has a sale at Circuit City this week for Buy 3, Get 2 free! In the last several weeks, I bought multiple Blu-ray movies for less than $10 a film (some as low as around $7).
You claimed that BOGOs started with "Transformers", but I told you my first Blu-ray movies were bought on Blu-ray at Best Buy on a BOGO, (I just checked my records, and I bought it the second week of February), yet your column still says that BOGO sales started with "Transformers". You also still state that a MSRP of $19.99 is just about right to you even though it's not realistic to expect HDM MSRP prices to be lower than DVD MSRPs (though I really would LOVE me a $5.50 HDM bin at Wal-Mart... which is where I've bought plenty of $14.95 MSRP DVDs).
I feel good about the points that I have made, but I believe you are correct regarding the "agree to disagree" as while I agree with your desire to want cheaper discs, I simply have no desire to keep explaining why history has shown us that prices will come down in due time.
BTW, Lionsgate is reducing the pricing of six of their catalog Blu-ray titles (T2, Stargate, Punisher, etc...) to a MSRP of $19.99 on January 22nd. Amazon and other retailers are already selling them at the new $19.99 MSRP, plus their usual 30+% discounting to allow for a price under $14.
~Alan
Joe Weep:
Everybody knows you are a small-brained HD-DUD fan, just as backwards as your format.
You cannot deny the fact HD-DUD discs are just as expensive as Blu-ray as opposed to HD-DUD group claimed.
Yes, for a 30-minute short movie, HD-DUD can get as high video bitrate as Blu-ray. For a 3 to 4 hours long movies, 30G is just pathetically too small to have an acceptable bitrate. It may be acceptable for low-life HD-DUD fans.
I don't know why I bother with guys like the last poster but you really need to get a life. Do thw workd a favor and pleae stay in your basement.
Post a Comment
<< Home