walmart only bought 55,000 A2's for that sale...?

[joeorc]

Latest Cut in DVD-Player Duel: Prices
Deals Rev Up the Blu-ray, HD DVD Battle
By YUKARI IWATANI KANE and SARAH MCBRIDE
November 23, 2007; Page B1

Until a few weeks ago, Bill Zimmerman had no interest in buying a next-generation DVD player, at least until a winner was declared in the battle between the two dueling formats, Blu-ray and HD DVD.

But the Kissimmee, Fla., copy editor changed his mind earlier this month when Wal-Mart Stores Inc. offered a special deal for an HD DVD player from Toshiba Corp. At $98.87, it was only a few dollars more than the standard Samsung DVD player that he was thinking of buying.

"Format concerns definitely went out the window at that price," Mr. Zimmerman says. Both Blu-ray and HD DVD players play high-definition movies with crisp images on big, high-definition televisions -- and also play regular DVDs. But until now, consumers have largely been reluctant to purchase players of either kind. With the next-generation players costing at least $300 more than standard machines, many were reluctant to spend the money on a player before the winning format was decided. What's more, consumers had to buy a pricey high-definition TV in order to see a difference in the images.
[DVDs The Sequel]

That picture is starting to change this holiday season since retailers began slashing the price of HD DVD players to a level much lower than anyone had expected. Makers of Blu-ray players are responding with their own price cuts.

Analysts say they don't expect the format battle to be decided until late next year at the earliest when more consumers will have high-definition TVs, prices on players will likely come down further, and more movies will be available. Nonetheless, while Blu-ray clearly led the race until recently, the aggressive holiday-season pricing could help bolster HD DVD's position, they say.

"The low price point was, if anything, a test and a precursor," says Paul Erickson, analyst at the NPD Group's DisplaySearch research firm. "They've shown that people will bite if the price is low." Mr. Erickson says he will probably revise his projections for HD DVD player sales upward though he declined to give an estimate. Tom Adams of consultancy Adams Media Research in Carmel, Calif., predicts that by the end of the year, households with stand-alone HD DVD players will total 600,000 and households with stand-alone Blu-ray players will total 400,000.

The price wars started late last month, when retailers like Wal-Mart, Amazon.com Inc. and Circuit City Stores Inc. dropped prices on a Toshiba player below $200 -- a critical level for electronic products that has sparked purchases in the past among general consumers. Then, Wal-Mart surprised industry observers by taking an additional $100 off in a 48-hour sale, triggering other retailers to match the price. The players sold out in minutes at some Wal-Mart stores. According to DisplaySearch, Toshiba sold 90,000 to 100,000 players in just two days.

Wal-Mart's $99 price was a temporary move to clear out an old Toshiba model, the HD-A2 player. But analysts expect the newer model to be available during specials for under $200. That is still much lower than the least expensive stand-alone Blu-ray player or Sony Corp.'s PlayStation 3 videogame console, which includes a Blu-ray player.

But makers of Blu-ray players are coming up with their own price cuts. After lowering its price on an existing Blu-ray player by $100 to $399 last Sunday, Sony, the lead manufacturer in the Blu-ray camp, said Best Buy customers could get an additional $100 gift certificate with every purchase starting today for the next few weeks, effectively making the players even less expensive. Customers will receive five free Blu-ray movies with their purchase; HD DVD buyers also get free movies.

"Make no mistake. We'll do what we have to do to remain competitive this holiday season on Blu-ray," said Sony's chief marketing officer, Andrew House.

While Blu-ray players cost more to make than HD DVD players and have had higher price tags, one big advantage for the Blu-ray camp has been more movie titles. Because of exclusive deals, only owners of Blu-ray players can watch movies by News Corp.'s Fox, Walt Disney Co., and Sony Pictures, while HD DVD player owners have exclusive access to titles by General Electric Co.'s Universal and Viacom Inc.'s Paramount. Time Warner Inc.'s Warner Bros. is the only studio that publishes on both formats.

But analysts say the price is now low enough that even Blu-ray fans might buy an additional HD DVD player so they can watch high-definition movies in either format.

Some Blu-ray backers say the format battle will depend just as much on the number of movie titles that each side sells, as movie studios will ultimately support the side that can sell more. Blu-ray now sells significantly more movies than HD DVD. "If you think the player price alone will somehow create mass adoption, that's a mistake," says Andy Parsons, senior vice president for business solutions at Pioneer Corp., a Blu-ray company. Movies in both formats typically cost $10-$15 more than regular DVDs.

One question is how long the companies can keep up such generous price cuts on players. A person familiar with the matter said that Wal-Mart bought about 55,000 HD-A2s from Toshiba for just under $200 apiece before the early November sale, and that it lost about $100 on each sale. A spokeswoman for Wal-Mart says the company doesn't comment on its negotiations with suppliers.

The head of Toshiba's HD DVD business, Yoshihide Fujii, says the company had no prior knowledge of Wal-Mart's plans and declined to comment on its marketing and promotional costs. "Right now we need to increase the size of the market," Mr. Fujii says. He adds that Toshiba expects to sell close to its goal of one million HD DVD players this calendar year, and triple that number next year.

Analysts say selling the players to Wal-Mart at such a low cost also likely represented a loss for Toshiba, but that's not unusual in the consumer-electronics business. Product plans generally call for getting rid of older generations of a product at low prices as newer generations hit stores, and the discounts are figured into the business models. Toshiba says it didn't sell any players below cost based purely on manufacturing expenses, but once marketing and promotional expenses are factored in, the HD DVD business is operating at a loss. The company expects it to turn profitable in its next fiscal year, beginning April 2008.

Increasingly, it seems that the solution to the format war may lie in dual-format players like the one from LG Electronics Inc. At around $1,000, they lie beyond the reach of most consumers this Christmas, but prices should drop drastically by next holiday season. At that point, consumers can buy high-definition movies regardless of format.

http://online.wsj.com/article/SB1195...googlenews_wsj

[GregBlu5]

"They" always say price is important, but then "they" bring up as a solution dual format machines that are priced so high that someone could buy a cheap-ass HD player and a reasonably priced Blu-ray player (especially this weekend) and still have money left over for several movies.

"Their" logic always escapes me.

-Greg

P.S. Unless one format wins, everyone loses.

[dialog_gvf]

One question is how long the companies can keep up such generous price cuts on players. A person familiar with the matter said that Wal-Mart bought about 55,000 HD-A2s from Toshiba for just under $200 apiece before the early November sale, and that it lost about $100 on each sale. A spokeswoman for Wal-Mart says the company doesn't comment on its negotiations with suppliers.

I suspect that was simply to insure no anti-dumping complaint is brought against Toshiba. Wal-mart almost certainly didn't lose anything. They were probably paid the difference and more for those promotion spots.

Gary

[quexos]

I would never buy a combo machine or an hd-dvd. It would only protract this stupid war.
Unfortunately here in Belgium we don't have much HD movies choice just yet.
I found a way to get some american Bluray discs so I hope to soon expand my hitherto small collection.

Guys, think beyond the close future, don't buy anything hd-dvd related. We must go for a kill or we shall die too

[sj001]

Funny how Toshiba keeps bringing up that fact that dual-format players are the way to go... they've already accepted the fact that they can't win this war, and are waving the white flag.

[Hawknelson05]

even if the numbers of hd dvd players in households is more,I'm pretty sure blu still sells more movies. We're pretty hardcore on here

[joeorc]

this just shows Toshiba and Microsoft know HD DVD cannot win so they are trying to maintain the stalemate..

[Mericalis]

Originally Posted by sj001

Funny how Toshiba keeps bringing up that fact that dual-format players are the way to go... they've already accepted the fact that they can't win this war, and are waving the white flag.

Um, actually it's another tactic for them to win-the-war-without-winning-the-war. In other words, we already know that reproducing discs on HD DVDs are supposed to cost less than Blu-ray. So, if everyone bought dual-players that play both, they do have an advantage on price of reproduction and they are hoping that companies (studios, etc) will see that as an advantage and switch.

Edit: When I say dual-players, I'm not talking about a Super Blu machine, I'm talking a player that actually plays both--the movie, supplements, etc.

[JAGUAR1977]

600k vs 400k standalones is hardly encouraging for HD-DVD considering the A2 firesale and cheaper players, especially when you take into account the PS3 will likely sell upto a million consoles this Christmas, plus those currently in the market.

Tom Adams of consultancy Adams Media Research in Carmel, Calif., predicts that by the end of the year, households with stand-alone HD DVD players will total 600,000 and households with stand-alone Blu-ray players will total 400,000.

[dialog_gvf]

Analysts say they don't expect the format battle to be decided until late next year at the earliest when more consumers will have high-definition TVs, prices on players will likely come down further, and more movies will be available. Nonetheless, while Blu-ray clearly led the race until recently, the aggressive holiday-season pricing could help bolster HD DVD's position, they say.

The consumers that really matter, the ones that buy the TVs that allow HDM to really shine, are likely to be getting a free Blu-ray player with their TV.

It's a definite uphill battle for HD DVD thrusting players into the hands of people unwilling to spend more than $100 for a player. These people probably won't be buying 1080p sets, and won't see the huge difference to DVD.

Gary

[blu2]

Originally Posted by dialog_gvf

The consumers that really matter, the ones that buy the TVs that allow HDM to really shine, are likely to be getting a free Blu-ray player with their TV.

It's a definite uphill battle for HD DVD thrusting players into the hands of people unwilling to spend more than $100 for a player. These people probably won't be buying 1080p sets, and won't see the huge difference to DVD.

Gary

You can certainly see a difference without a 1080p set. The huge majority of HDTVs out there in homes today do not support a native 1080p resolution.

I think many people miss the point on "people unwilling to spend more than $100 for a player"

It's considered throwaway and zero risk at such prices. Many people will not spend a lot of money on HD DVD or Blu Ray players because of the risk of the format failing. We have zero absolute commitments from any studios. (Despite WB assurances to the contrary, many people on this very forum think WB will switch to Blu Ray early next year for example)

Spending $500 on a BD 1.1 player would be a risk many people would not consider.

$100 is much easier to rationalize from a risk perspective. It's not a matter of "affording" it.

[Animusmors]

These fools, they always leave out the PS3. I hate these articles full of FUD there is no mor atvantage to HDDVD anymore except the price which just looks like a generic player to me and to others. I work at circuit city and most of the people who bought into HDDVD are those who really don't know what the HDDVD actually is. They didn't know that it played a different format they just thought that it made their DVDs HD. Which it does upconvert on some models. I'm always educating everyone who looks at the two formats with the simple facts. It took me a long time to buy into this new format, i read everything especially from this site, with it's wealth of knowledge. I have a PS3 for a blu-ray player and this article doesn't count me. Why doesn't it count me? I have 8 Blu-rays right now and my collection is slowley expanding. I've compared the two formats side by side, there is no doubt that Blu-Ray is more "clean" as far as free from the compression artifacts in most movies. And when you look at the movies side by side on the shelves, you clearly see more movies on blu-ray. Yes i do admit i would really love some movies that are on HDDVD but you can see from those studios that their marketing strategies are really gettting desperate. I've heard some people talk their friends into the HDDVD format just because it's cheap. I pipe in with the facts to those people, some have actually changed their mind and sold their HDDVD player. OK, now i'm ranting again. But the key are those who can afford HD TVs and most of those people actually buy Blu-Ray players. The price doesn't matter when you take into account the support from the studios and the manufacturers.

[Tulsa]

You can also bet the people only willing to jump when there's a $99 special are the people who aren't going to buy a lot of movies, they are the renters of the world. This will not help toshiba survive.

[hoser]

Originally Posted by Tulsa

You can also bet the people only willing to jump when there's a $99 special are the people who aren't going to buy a lot of movies, they are the renters of the world. This will not help toshiba survive.

Truth.

[dialog_gvf]

Originally Posted by blu2

You can certainly see a difference without a 1080p set. The huge majority of HDTVs out there in homes today do not support a native 1080p resolution.

Absolutely. In fact, you can see a difference even without a HDTV. The 480p coming from an HD player will be superior simply due to the lack of compression artifacts in HD encodings. But, it all depends on who is looking.

I don't merely mean a difference. I mean a difference so obvious and grand that the consumer refuses to purchase anything else but HDM.

And being psychological, people can convince themselves of all sorts of things. The audio/videophiles tend to convince themselves that small differences are much bigger than they really are. Given the price difference between DVD and HDM, the consumer might convince themselves there isn't any real difference.

720p can be as little as 2x effective DVD resolution (bob de-interlaced 1080i).
1080p can be as much as 3x 720p, and 6x DVD resolution.

Gary

[dialog_gvf]

Originally Posted by blu2

$100 is much easier to rationalize from a risk perspective. It's not a matter of "affording" it.

The risk was never in the player. It's in the software.

Gary

[JAGUAR1977]

Originally Posted by dialog_gvf

The risk was never in the player. It's in the software.

Gary

That's so true, picking up a player for either format is relatively cheap, I'd worry howerer if I had dozens of HD-DVD's if the format went tits up.

[WickyWoo]

It's the "some people say" meme that people of all stripes and goals use to try to spin opinion or an agenda as fact.

Wow, this comes about right when Murdoch buys WSJ

http://www.youtube.com/watch?v=NYA9ufivbDw

[Teazle]

Hmm, the analysts are saying quite a bit in that story. They sound distinctly like pro-HD-DVD analysts. Paul Erickson is the only analyst quoted or named.

[savage1984]

Originally Posted by quexos

I would never buy a combo machine or an hd-dvd. It would only protract this stupid war.
Unfortunately here in Belgium we don't have much HD movies choice just yet.
I found a way to get some american Bluray discs so I hope to soon expand my hitherto small collection.

Guys, think beyond the close future, don't buy anything hd-dvd related. We must go for a kill or we shall die too

I second that! by the way, brussels is sweet and so is bruge (sp?).