Blu-ray Victory May Hurt Xbox 360 and PS3 Dominance
On Tuesday, February 19 2008, Toshiba has officially confirmed the end of the format war against Blu-ray and announced that it will no longer develop, manufacture or market HD-DVD players and recorders; it will end shipments into retail by the end of March and end production of HD-DVD disc drives for PCs.
The electronics giant also confirmed it will cease production of the add-on HD-DVD drive for Microsoft's Xbox 360 console by the end of March, opening the doors for Sony's PlayStation 3 as the only games system to support the winning Blu-ray high-definition platform.
With this statement, however, analysts already believe that the company may be facing increasing pressure from Sony as a result of the outcome of the format war.
Ralph Shackart, an analyst with William Blair, said that “Blu-ray's victory could drive market share gains for the PS3, as we believe consumers will now be more willing to pay up (versus 360) for the standard Blu-ray player.”
"We carefully assessed the long-term impact of continuing the so-called 'next-generation format war' and concluded that a swift decision will best help the market develop," said president and CEO of Toshiba, Atsutoshi Nishida.
"While we are disappointed for the company and more importantly, for the consumer, the real mass market opportunity for high definition content remains untapped and Toshiba is both able and determined to use our talent, technology and intellectual property to make digital convergence a reality."
On the other hand, Microsoft which originally announced in 2005 its decision to focus on HD DVD, but did not believe that HD DVD would be a long-term solution for high-def media, in January 2006, the company announced that it would offer an external HD DVD for the Xbox 360 – which was launched in November of that year.
Although Microsoft has always backed Toshiba's HD-DVD format, offering an HD-DVD add-on drive for its Xbox 360 console, the firm believes games are what really matter.
“We do not believe the recent reports about HD-DVD will have any material impact on the Xbox 360 platform or our position in the marketplace," a spokesperson for Microsoft told Next-Gen. "As we’ve long stated, we believe it is games that sell consoles and Xbox 360 continues to have the largest next-gen games library with the most exclusives and best selling games in the industry."
Despite the demise of the HD-DVD platform, Xbox 360 users can continue to access high-definition content by downloading from the Xbox Live Marketplace and by streaming content from a PC using Windows Media Center.
The CEO of Sony Computer Entertainment America, Jack Tretton, in an online interview, said the demise of HD-DVD was 'one more reason' to buy a Sony PlayStation 3 console. "The emergence of Blu-ray as the de facto high-definition standard is one more reason why PS3 is a great value to consumers," told Tretton.
"The combination of strong sales, Blu-ray dominance and widely-anticipated games all point to 2008 as a breakthrough year for PS3."
Toshiba Pulls the Plug on the HD DVD Format: Who Benefits?
How will Toshiba's decision to terminate HD-DVD impact the format's supporters? And what does it signify for its bitter rival, Blu-ray?
Blu-ray was introduced by Sony in 2006 and this disc format has been rapidly gaining market share recently. "Blu-ray delivers a storage premium over HD DVD discs with two-thirds more data capacity," says ABI Research analyst Serene Fong. But, Blu-ray technology requires newer manufacturing techniques and factories which raise the initial start-up costs for manufacturers.
“The HD DVD camp took a more pragmatic approach, as HD DVD allowed manufacturers to make use of existing assembly lines to produce DVDs en mass. This led to the prevailing view that HD DVD discs were cheaper to manufacture because of the similarities to previous video technology. And this is one of the main reasons why multimedia player manufacturers have been procrastinating on Blu-ray integration," she added.
The Blu-ray camp now has the support of major Hollywood studios including Warner Bros, Twentieth Century Fox, and Walt Disney, and that of major consumer electronic manufacturers including Panasonic, Samsung, Pioneer, LG Electronics, Sharp, Dell, HP and Apple Computer. The allegiance of movie studios plays a determining role in driving growth.
When Warner Bros., Hollywood's largest distributor of DVDs, and major retailers such as Wal-Mart, Netflix, Target and Blockbuster decided to switch allegiance early this year, it indeed raised the alarm for the HD DVD consortium. Fong explains, "People buy high definition DVD players to watch movies, and without the support of the studios, there was no way HD DVD could survive for long."
"But," adds principal analyst Steve Wilson, "the real winners now are the studios. With standard DVD sales on the decline and a stalemate in the new high definition standard, it was very difficult for studios to drive a new product into the market. Challenges still remain - player cost, disc manufacturing cost, high definition disc pricing, player adoption - but at least the uncertainty about market direction is now eliminated."
Consumers, for the most part, had no particular favorite between the two standards. With the adoption of Blu-ray, neither bettors on HD DVD nor Blu-ray are winners. None of the existing Blu-ray players on the market are upgradable to BD Live/Profile 2, a feature supported in all HD DVD players from the first release.
In addition, consumers shouldn't expect to see Blu-ray player pricing dropping to HD DVD price levels anytime soon. None of the Blu-ray vendors, except Sony, have shown any propensity to drive player adoption through lower prices. They are more likely to let the studios wrap the box with Blu-ray discs as an incentive. Taiwanese vendors entering the market will help bring down prices, but it will be another 12-18 months before the Blu-ray format reaches the maturity and value of that offered by HD DVD. Consumers are the losers in the short term. /PR
Blu-ray Siap Dominasi Format DVD
"Dalam tiga tahun ke depan ini hanya ada Blu-ray." Hal ini ditegaskan oleh Frank Simonis, pimpinan Blu-ray Disc Association, Eropa, dalam wawancaranya dengan Reuters pada konperensi teknologi CeBIT 2007 di Hanover, Jerman, sebagaimana dikutip eBizzAsia.
Penegasan Simonis ini semata-mata prediksi bahwa Blu-ray akan memenangi perang formatnya dengan HD-DVD, melainkan lebih jauh Blu-ray, nantinya, akan sepenuhnya menggantikan format standar DVD yang sangat popular saat ini, pada tahun 2010.
Perang format antara Blu-ray dan HD DVD mengingatkan kita terhadap perang yang hampir sama puluhan tahun lalu antara videotape berformat VHS dan Betamax. Saat itu, Sony kalah, namun dengan kemungkinan kemenangan Blu-ray saat ini dan ke depan, Sony akan menuai sukses besar. Menurut kalangan pengamat, keberhasilan Blu-ray ini dapat ditelusuri dari banyaknya dukungan perangkat keras yang diberikan bagi pengembangan Blu-ray.
Namun, para analis menampik bahwa perkembangan itu kemudian akan menghilangkan standar DVD dari pasar dengan cepat. Menurut Alison Casey, dari perusahaan riset Understanding & Solutions, yang berbasis di London, kehadiran format baru tidak pada saat yang sama menghilangkan format lama.
Dalam pandangan Casey, para konsumen bisa saja menggebu-gebu ingin membeli pemutar disc definisi-tinggi (high-definition disc players) atau PlayStations 3, namun dalam lima tahun ke depan sebagian besar konsumen masih tetap akan menggunakan standar DVD.
Hanya saja, menurut Casey, ketika perangkat DVD yang digunakan saat ini rusak dan perlu diganti dengan yang baru, misalnya, maka kemungkinan besar mereka akan bertransisi dengan membeli yang definisi-tinggi. Para konsumen memang akan punya kecenderungan untuk meningkatkan-diri, namun hal itu akan berjalan cukup lama, diperkirakan sekitar lima tahun, sampai sebagian besar konsumen benar-benar menggantikan DVD mereka dengan format yang baru.
Di sisi lain, keberadaan PlayStation 3 buatan Sony juga banyak mendorong penggunaan disc Blu-ray, karena PlayStation 3 dapat menggunakan Blu-ray. Hingga kini, setidaknya Sony telah menjual tak kurang dari 2 juta unit PS3 ke Amerika dan Jepang, dan jutaan lainnya ke pasar Eropa dalam mingu-minggu mendatang.
Banyak kalangan menilai bahwa pengaruh PlayStation 3 terhadap pilihan format bermula dari semakin meningkatnya penjualan film-film bioskop, dimana film-film berformat Blu-ray mengungguli film-film yang berformat HD DVD, dua berbanding satu pada bulan pertama tahun 2007. Ditambah lagi, ketika film unggulan pemenang Oscar "The Departed" yang diluncurkan dalam kedua format, terbukti versi Blu-ray terjual sebanyak 20,000 kopi sedang yang berformat HD DVD sebanyak 13,000 kopi.
Keberadaan PlayStation saat ini dan besarnya dukungan dari pembuat perangkat keras yang tampaknya menjadi faktor penting dalam mendorong pilihan ke Blu-ray. Tak pelak, ke depan, diperkirakan Blu-ray akan mendominasi pasar definisi-tinggi.
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