Consumers delaying Blu-ray purchases, can't find value proposition
You just have to love the mixed messages, don't you? On one hand, you've got research asserting that Blu-ray simply isn't gaining the desired amount of traction since the demise of HD DVD; on the other, you've got numbers showing that BD adoption actually is on the up and up. So, which is it? According to a hot-out-of-the-oven study by ABI Research, consumers in America are still procrastinating when it comes to buying into Blu-ray. Over half of the 1,000 respondents noted that they had "no plans to purchase one," with 23% suggesting that they might take the plunge in 2009. Principal analyst Steve Wilson, in our estimation, nails the reason right on the head: consumers can't see why Blu-ray is worth the extra coin over DVD. Let's face it -- VHS to DVD was entirely more dramatic than DVD to Blu-ray, and for folks still watching an SDTV, Blu-ray isn't even a consideration. Slow and steady, BD, slow and steady.[Image courtesy of WikInvest]
Filed under: Industry
Reader Comments (Page 1 of 2)
jrtallen @ Aug 1st 2008 1:08PM
If consumers don't see the benefit of Blu-ray, then why do they see the benefit of HDTV?
Ed @ Aug 1st 2008 1:22PM
Probably because of HD cable, which doesn't cost any more than standard cable.
You don't have to own a HD movie player just because you have an HDTV in the same way that you don't have to own a DVD player just because you have a TV.
tlarkin79 @ Aug 1st 2008 1:27PM
The benefit of Blu-Ray is easy to see. The problem is finding the value. It's just too expensive to buy Blu-Ray movies and the player prices aren't low enough yet. There's just too much of a markup over regular DVD prices.
jrtallen @ Aug 1st 2008 1:32PM
Following the same logic, just because there is Hi-Def cable, doesn't mean you have to spend thousands of dollars on an HDTV. And yet consumers seem to be doing quite a lot of that, indicated that they indeed do understand and want HD.
Chad @ Aug 1st 2008 3:18PM
No, people are buying HD tvs because analog signals are stopping next February. If these analog signals didn't have an EOL date, the market for HD tvs would be MUCH less.
jrtallen @ Aug 1st 2008 3:45PM
This reinforces my perception that assertions that consumers are not interested in BD logically boil down to a claim that consumers are not interested in HD in general.
I do not believe that consumers are spending thousands of dollars on new HD sets merely because they mistakenly feel they are obliged to.
benny boy @ Aug 1st 2008 4:16PM
It's nice to have a civilized debate for once without the usual flame wars.
jrtallen @ Aug 1st 2008 4:37PM
heh I just had that exact thought. Please pass the crumpets.
pedantic @ Aug 2nd 2008 4:55PM
Consumers don't really understand the benefits. They can see that the TV is wider, and they know their old TV isn't that way. They can see that plasmas and lcds are thinner. But do they even know the difference? Go to Best Buy during the weekend and ask random people looking at HDTVs and see.
David S @ Aug 1st 2008 1:20PM
I find it hard to justify spending more than $20 per disc. I can stomach expensive players (
EQC @ Aug 1st 2008 2:56PM
Exactly...and that's basically how it worked with the VHS to DVD transition.
At first, DVD players and disks were super expensive compared to VHS.
Soon, the players were still pretty expensive ($200-$300), but disks got cheaper than VHS. Everybody started buying. VHS lost shelf space. Blockbuster just about eliminated VHS. Poof, DVD won. Eventually, DVD players got cheaper and cheaper, and now a DVD player is cheaper than a VCR.
I expect the same to happen to Blu-ray eventaully -- the players will still cost a bundle, but the disks will (hopefully) get cheap. An expensive player is a one-time purchase that lots of people are willing to swallow if the disks are cheap. Cheap disks means lots of sales.
Fred @ Aug 1st 2008 10:34PM
EQC... I totally disagree. The difference in price from VHS to DVD is not the same as the difference between DVD and Blu. Average brand new DVD is 15 dollars, new Blu is 25, thats 66% mark up for better picture and sound.
And I still argue that a new DVD cost to much. 15 dollars
Besides it took consumers just started buying HD TVS, it will take a while before Blu drops prices and people start to flock that way. Until then, its just us boys.
EQC @ Aug 3rd 2008 12:57AM
Fred: I'm not sure where we disagree...other than perhaps memories of DVD/VHS prices?
I think there was a time when new DVD's cost $25-$30 and VHS tapes were $10-15...but I could be remembering incorrectly.
When DVD was much more expensive than VHS, DVD did not sell well. Prices came down, and people started to buy...In fact, I remember a time when new DVD's were regularly on sale for about $12 when they were really trying to kill off VHS (and, like you, I'm pretty displeased that prices for new titles are at least $15 now).
Situation is similar now (sortof) with Blu-ray -- disk prices for BR are way high, but I expect them to come down...hopefully.
I also agree on your point about HDTV's...obviously, there's not much sense in getting a BR player for an SDTV. But, at least for those with HDTV's, I'm just trying to say that when BR disk prices come down, BR marketshare will increase dramatically.
If the players stay expensive for a while (well, they ought to at least hit the $200 range), that's not too much of a problem...it's the disk prices that I believe people care about most.
David S @ Aug 1st 2008 1:21PM
I find it hard to justify spending more than $20 per disc. I can stomach expensive players (less than $400), especially since you might end up with a Media Extender, Netflix Player, or a game console. But Amazon wants $27.95 for Doomsday? Are you serious? Or Best Buy, wants $30 for Cars? I enjoyed Cars, but that's a lot for a movie that's been out for how long on DVD?
daaper @ Aug 1st 2008 1:57PM
As much as I like Blu-ray, I agree with you. If you're one of those consumers that has to have movies the moment they're released, Blu-ray can be a lot to stomach. The only movies I actually own are ones that I got great deals on. For now, I prefer to rent with the occasional buy.
JimC @ Aug 1st 2008 1:22PM
They need to do more side by side demos. If people actually compared them, they would see the difference. Seeing is believing...
WebDev511 @ Aug 1st 2008 3:37PM
Seeing sure is believing, but if one side is Blu on a 42" 1080p set and the other is a sub $100 upconverter on a 42" 720p set it's hard for a vast majority of people to see the difference. To do it right the demo would have to be a 32" SD tube hooked up to a progressive scan player, but I for one haven't seen such a display.
The problem is that 1080p content only just starts to look better on 50" or larger sets, but the people I've talked to at Target, Best Buy & Fry's see just how much bigger and more space a 50" set takes over the typical 32" tube they freak out. A 37" or 42" is a big upgrade for them and no matter how much you can point out macro blocking on upconverted DVD or image quality improvements on Blu, the player and movie premiums are hard to avoid.
JimC @ Aug 1st 2008 3:56PM
I have a 46" 1080p and I can tell the difference when the source is 720p versus 1080p. If vendors would setup a 46" 1080p screen with a blu-ray player next to the same TV connected to a typical upscaling DVD player playing the same movie, side by side, the difference would be obvious.
I do think they need to lower the cost of movies but seriously, $24 for a movie isn't that bad. I remember paying that much for DVD's. Granted the high cost of the movies may prevent some from buying a player in the first place but once they did, I doubt they would balk too much at movies costing $20-$26 at walmart.
But in this slow economy, BD should lower MSRP and stimulate a growth in the installed base.
worldbfree4me @ Aug 1st 2008 8:05PM
BDA should focus on making this so called HD media portable(playable in all drives)..ie DVD can play at home, office, car, relatives etc...Blu will only play at your home because the chances of your neighbors or in-laws owning an actual Blu player are slim to none. Sharing a movie you like with others is important and Blu just cannot be shared or even pirated in great numbers at this point.
Brent @ Aug 1st 2008 1:27PM
I think it mostly has to do with the premium on the movies themselves. $30-40 is a lot to pay for just one movie when most new DVD releases can be easily found at $15-20. If they were sold at a $5 premium instead of $10-20, sales would probably go up dramatically.
wreckedchevy @ Aug 1st 2008 3:10PM
i would have to agree my folks bought a 50" lcd and stopped by my house and watched part of transformers on my a20 and decided to go get one until they seen the price of the movies and said no way.
tlarkin79 @ Aug 1st 2008 1:30PM
As for side-by-side demos, I see them everywhere. Unfortunately, the asiest thing to see the difference of is the price.
Jimmy @ Aug 1st 2008 1:30PM
So much for analysts...
It is pretty clear that Blu-ray's adoption is tied directly to HDTV adoption. As HDTV sales increase so will Blu-ray's. They will not be tied 1-to-1 but rather, Blu-ray will always be some percentage of the number of HDTVs. This is pretty simple to understand.
The second thing that is easy to realize is that Blu-ray will be adopted by more people as the price comes down. The price is dropping, pretty quickly in fact, to the point where it is a no-brainer add-on to any HDTV purchase. I imagine the following spiel happening thousands of times per day in electronics stores everywhere.
"You are getting a great new high definition television. Don't you think you should get a new high definition disc player too? I mean you do want to take full advantage of you new TV and the best way to do that is with a Blu-ray player. We have them on sale today for as low as $xxx"
As the percentage of the price of the player drops in comparison to the price of the TV more and more people will pick them up. This is logical and expected for Blu-ray but by no means guaranteed to happen.
h0mi @ Aug 1st 2008 2:13PM
There will also be some lag time. People who just spent $1000 on a TV aren't going to be that quick to jump on a $400 player when DVD players are $40. But when they see HDTV looks better than their DVDs, blu-ray will be there to look better still.
Brent @ Aug 1st 2008 1:41PM
I'd like to see comparisons of how blu-ray is doing compared to the early years of DVD. Blu-ray is only 2 years old and I'm pretty sure DVD sales weren't that great after they had been around only 2 years. It probably wasn't until year 4 or 5 that DVD really started taking off, mostly because the players had dropped to $100 and the movies were finally under $20.
DVD4ME @ Aug 2nd 2008 2:11AM
Those numbers are totally irrelevant, DVD was a huge change in format from VHS and both of those formats worked on 100% of every TV, BR's growth is directly proportional to HD TVs which are currently what, 25%.?
Also, a massive amount of DVD's growth came from the PS2, the totally dominant games console which pretty much had the market to itself, today PS3 which really is the only driving force for BR sales is a very distant 3rd place.
andyg8180 @ Aug 1st 2008 1:56PM
do the math...
If 1% of consumers were buying Blu... and then 2 months later, 2% of consumers were buying blu, thats a 100% increase in two months...
Then you'll read engadget articles saying "100% increase in consumers purchasing bluray"
Then you;lll get all the engadget commentors saying, YAY WERE WINNING...
and then all the HD-DVD fans will still be crying how stupid people are to not adopt HDDVD (like me).
and then 2 months later you'll get another article saying "people just arnt buying... 2% of consumers are happy"
worldbfree4me @ Aug 1st 2008 7:45PM
Although I cannot watch them anywhere but at my home, and for that matter you cannot either (father in-law does not count)I am still happy with my $50 Hd-DVD purchase. Big box stores like Frys continue to blow out Hd-DVD's for as low as $6.99
http://shop1.frys.com/category/Outpost/DVDMovies/HD-DVD/
as a result my HD library has grown steadily on the cheap.
Josh Poulson @ Aug 1st 2008 2:02PM
Blu-Ray adoption will improve when selection improves. The recent Jack Ryan items, Mummy items, were a boost, Wall-E and Finding Nemo this year will be a boost too, but for the most part I am not enjoying much of what comes out on Blu-Ray. Where's the high def TV series? Where's the spectaculars? Where's the Criterion Collection?
Mr. E @ Aug 1st 2008 4:47PM
The Godfather set will certainly sell some players later this year, as will Iron Man and The Dark Knight when they come out.
Mr. E @ Aug 1st 2008 5:03PM
Oh yes, and Criterion already announced they will have titles on Blu-ray starting this year. October is when they're supposed to appear, I believe. I can't wait.
worldbfree4me @ Aug 1st 2008 7:54PM
Although I cannot watch them anywhere but at my home, and for that matter you cannot either (father in-law does not count)I am still happy with my $50 Hd-DVD purchase. Big box stores like Frys continue to blow out Hd-DVD's for as low as $6.99
http://shop1.frys.com/category/Outpost/DVDMovies/HD-DVD/
as a result my HD library has grown steadily.
UnnDunn @ Aug 1st 2008 2:02PM
The problem this attitude presents is that the BDA doesn't have time to wait for people to warm to Blu-ray. Digital downloads are already here, and the various services are finally beginning to get their ducks in a row to make a play for the living room.
Xbox Live is already quite successful, and this fall it will drive adoption of Netflix streaming. Both Dish and DirecTV have announced plans for 1080p downloads. Even Sony is getting in on the act with a companywide initiative, spearheaded by its Sony Computer Entertainment division, to provide downloadable movies to all of its connected audiovisual devices.
To be sure, movie downloads will not be ubiquitous for a few years yet... but then neither will Blu-ray. Both are at at similar stages in their growth trajectories. The difference is Blu-ray has a shelf-life; movie downloads don't. Digital distribution is the future of movies; Blu-ray is just a stopgap. The question isn't whether Blu-ray will bow out in favor of digital download, the question is whether Blu-ray can achieve mass-market adoption before that happens, and how long it will last.
Personally, I think everyone at the BDA can go hang, but that's just me.
Andy Anonymous @ Aug 1st 2008 4:39PM
The Netflix service for Xbox 360 won't have HD movies, at least not for the time being.
why not the LS2LS7? @ Aug 1st 2008 6:45PM
The Netflix service not only doesn't have HD movies, but most of the movies available are small-time releases or very old.
The studios offer exactly the same movies for cheap download to Netflix as they do to Apple and others. And the selection is poor. Remember Apple announcing the AppleTV and then finding it was all catalog titles? The same thing applies here.
The studios are offering catalog titles for direct streaming because they aren't worth much. They already offer them cheaply to TV stations and cable channels, and you could watch those for free if you want, so these streaming sales are designed to capture just a little more cash.
High-line releases are still reserved for disc sales and rental and PPV right now. They want to get the customers who will pay $15 for something to do so before they go offering it for $1.99 or a cheap rental/stream.
And I don't think the studios are going to change on this soon.
DVD4ME @ Aug 2nd 2008 2:19AM
J6 will say, I would rather download and watch an SD movie today then wait a week + to rent a BD disc, convenience will out way quality for the masses
jimmy @ Aug 1st 2008 2:04PM
I see many people love Bluray and many hat due to high prices.
But do you guys want to read the faq of bluray technology compare to hd-dvd.
Just visit this nice Blu-ray Technology Guide.
http://www.bluraycddvd.com/faq.html - Blu-ray Vs Hd-dvd Guide.
Plus if you don't able to get very cheap price we are here to help you.
Grab very cheap blu-ray dvds and other stuffs like players.
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Ken @ Aug 1st 2008 2:25PM
Yeah, a $5 premium would sit well with me, but seeing these things selling for $25-35 is a real turn off for me.
Literally, I could not bring myself to pick up a $35 BD movie and take it to the register to pay. With Netflix, I feel dirty just buying a $15 new release DVD.
Mr. E @ Aug 1st 2008 4:51PM
Are you comparing catalog titles or new day-and-date releases? The new releases have a small delta in MSRP price between the special edition DVD and Blu-ray (generally your $5 or less). It's the catalog titles that are out-of-proportion expensive on BD. I know they will drop eventually, so I'm keeping a list of the catalog BDs I really want to get, and I'll get them when the price drops into my comfort zone.
h0mi @ Aug 1st 2008 2:30PM
"consumers can't see why Blu-ray is worth the extra coin over DVD"
Most of this is the high cost of players. $400 is a lot to drop on a player, and people don't like spending that much on a player. When players are consistently in the $200 range, just as with DVD, it will sell better.
I don't think blu-ray disc prices is that big of an issue but there are about 6 titles I want to buy and haven't because I don't want to spend $180 on them.
"Over half of the 1,000 respondents noted that they had "no plans to purchase one,""
Just a remark. In December 2006 I had no plans to buy HD-DVD or Blu-ray. By July 2007 I owned both.
Tejas @ Aug 1st 2008 2:38PM
Now, I'm a consumer who's procrastinating buying a Blu-Ray player.
My reasons are simple: Discs too expensive, Drive too expensive!
I mean, I have an HTPC, a Home Theater system, an upscaling DVD player, and an HDTV. Everything's hooked up and golden. In total, I've spent around $1000-odd over the last month getting everything together.
A Blu-Ray drive/player itself will put me back by around $400-$500! that's twice my HTiB's cost and almost 3/4th of the cost of my HDTV!
Then, to enjoy the HD quality of the B-R player, I need to buy Blu-Ray Discs. Now that's a never ending recurring cost unless I rent it! It's easier to download a movie from one of the HD providers for watching online using my HTPC, rather than buying the Discs and piling them up in my book/DVD shelf! Less clutter!
I might probably buy a Blu-Ray Drive eventually... I might buy a gaming console, so I might end up with a PS3 and it's integrated Blu-Ray drive! Who knows? but at the moment, this is just too expensive to maintain and use!
HDTV is good on DirecTV... I don't watch a helluva lot of TV, but whatever I watch in HD, I'm happy with it! :-)
Blu-Ray is a luxury at the moment... one that's probably not worth the pretty penny being charged!
Shack @ Aug 1st 2008 3:04PM
FYI, I didn't have to try very hard to find a BD-ROM in the $130-$170 range or a 2X burner, while slow, that can be had for less than $300.
Tejas @ Aug 1st 2008 3:18PM
I guess one more thing holding me back is technology progress!
I'm assuming that by the time it becomes affordable, technology will have progressed by leaps and bounds and we'll probably have really fast drives and maybe even higher capacity or some additional features!
Why not? Wait and watch seems to be the best approach!
andy @ Aug 1st 2008 3:28PM
newegg.com is selling the LG combo HDDVD drive and blu-ray writer for 190 bucks. The read only drive is 150 bucks.
If you already have a HTPC, you have no reason not to have a BRD/HDDVD player.
tzedekh @ Aug 1st 2008 2:53PM
When there's little or no premium for Blu-ray players or discs, then people will buy them. Netflix will charge a buck extra per month for Blu-ray rentals. When there's a decent sub-$100 upgradeable player that upconverts DVDs very well, people will probably buy. But the manufacturers' greed is what's hindering them.
Deadhouseplants @ Aug 1st 2008 2:53PM
A lot of you must have not been around when DVD first came out, and its price point was far greater than VHS tapes. I remember it, and I even paid $380 for one of the first DVD players. The point is this, give it time, Blu-Ray is still in its infancy. Spend the money on the player, then just go crazy with Netflix, and watch the shows and movies by renting them. If there is a title you must have, then buy it.
Here is my gripe about the current available titles with Blu-Ray, if you are going to sell a movie title under Blu-Ray, and charge $28 for it. Make sure you have enough features to justify the price. I'm not going to pay that much for just the movie and some trailers, that's not a step up from the DVD format. Overcharging the price is actually a step down.
Also, one thing, whenever we talk about Blu-Ray, can you not mention High-def downloads. They're not in the same league. Even if they were, how long before you think the good old cable companies will allow you to download 20 to 30 GB titles on their networks before they gripe. If they're complaining about P2P now, just wait.
Shack @ Aug 1st 2008 3:14PM
Manufacturers' greed?
Remember the losses Toshiba took on their players for the prices we were seeing?
Think about it this way...
The cheapest BD-ROM will run you ~$130...add to that a video processor, audio processor and just a few other things you're getting really close to the $298 magnavox at walmart.
As people buy more and more of the players component prices will go down and player prices will follow. Same as with DVD.
tzedekh @ Aug 1st 2008 4:12PM
Sorry, I don't buy it. One of the cheapest players around is the 40-GB PS3, which is being retired to make room for a new 80-GB model at about the same price. Yet it has gameplaying capability, the Cell supercomputer-level processor, a hard drive, and future-proof upgradability. The only things it seems to lack are RAM expandability and CableCard/Tru2way slots, or else it would be a fine Linux-based PC/STB/DVR, in addition to being arguably the best Blu-ray player around. Surely, manufacturers should be able to make a dumb (less-capable) Blu-ray player for less than $200 even now.
Mr. E @ Aug 1st 2008 4:59PM
tzedekh, what you may be forgetting is that Sony subsidizes the PS3 since they make money on the game licensing. This is how all the game consoles work; it's the old "give away the razor and make money on the blades" idea. Other manufacturers of Blu-ray standalone players (and Sony's consumer electronics division) don't have the luxury of doing that, so they have to make a profit on every player they sell.
Prices will drop. By the end of next year, everyone's going to have forgotten that Blu-ray hardware prices were ever high (just as people seem to have forgotten how expensive DVD players were at one time).
Shack @ Aug 1st 2008 3:21PM
In my opinion, they can throw out all bonus features and even the trailers. Use as much of that 50GB for the movie and soundtrack as possible. Use as little compression as you have to and put that other crap on a disc you can get with a mail-in-rebate, postage due package. Wow, wasn't aware I felt so strongly about bonus featuers...