August 9th: Digital Bits' Blu-ray Rant, Part 2

[The Big Blue]

http://www.thedigitalbits.com/#mytwocents

That's not to say that HD-DVD will disappear. Studios that currently support the format will probably continue to do so. But most retailers will likely not be as friendly. And as Blu-ray hardware prices continue to drop moving into 2008 and beyond... the choice for the vast majority of consumers interested in high-def on disc will be even more obvious than it already is. Keep in mind, all of this is playing out without a SINGLE new Blu-ray title announcement from Fox or MGM... and Fox continues to tell me that new announcements ARE coming.

[Josh]

I seem to have problems getting to the Bits. Is my internets screwy, or is it down?

[CptGreedle]

not just you...

[bluflu]

Originally Posted by Josh

I seem to have problems getting to the Bits. Is my internets screwy, or is it down?

The page took a few seconds to load, but I got through.

[The Big Blue]

I just checked and it fired right up.

[WickyWoo]

I just talked to Bill, they were mucking with something and everything's up on his end, but I can't get there either from the philly area

[Josh]

Originally Posted by CptGreedle

not just you...

I'm in Arlington, so we are probably on the same backbone. I wonder if its a DNS issue.

[Ender]

I can't get it to load either.

[Jeff®]

I got through using a different ISP - but I'm only seeing his 8/07 post at the top...

[marzetta7]

Came up for me. Great read. I agree with everything he says.

[Jim L]

I'm in central NC and can't get to it either. I think I'm on the same backbone too.

[marzetta7]

For those who can't see the link...

All right... I've been working on our EMA Day Three coverage for three days now, because there's a lot to talk about. I'd planned to post it last night, but a question cropped up related to something that happened during the HD-DVD panel discussion with Universal. Specifically, I wanted to be sure of an answer that Universal EVP for Marketing, Ken Graffeo, had given in response to a question from the audience. Now our friends over at Home Theater Forum videotaped the panel and have posted the videos online... except during that key moment of the panel, Ron was changing tapes on his camera, and so he missed Graffeo's response (it would have occurred at the start of video #6 had it been recorded). Luckily, several audience members made audio recordings, so I was able to confirm that he'd said what I remembered he'd said. That's even more important today, in light of a story that's been posted by Scott Hettrick over at Hollywood in Hi-Def.com.

Before I get into this, I want to be really clear about something. Because the moment I get into this, there's going to be a small group of guys who will start posting rumors on various discussion forums online. Other than regular advertising payments, which we accept from any and all studios who may wish to advertise on the site, The Digital Bits has never, and will never, accept money from anyone related to the Blu-ray Disc camp for an endorsement of that format. PERIOD. I'm not getting paid to endorse Blu-ray, none of our staffers are getting paid to do so. I do not get paid by anyone connected to Hollywood in Hi-Def.com. I contribute reviews there for free. Our decision to select Blu-ray as our high-def format of choice here at The Bits is our own - a decision we arrived at based on long and careful deliberations related to which format we thought had the best chance to win the format war, and our belief that a quick end to the format war is in the best interests of our readers and the industry as a whole. Anyone who tells you otherwise, anyone who says we're paid shills for the BD camp, is... flat-out... telling tales out of school. Got that? Good.

Now then... as I said, Scott Hettrick's posted an article over at Hollywood in Hi-Def.com that I think is well worth reading, because it speaks directly to something we've suspected for a long time now: Specifically, that Universal is getting financial incentives to create exclusive HD-DVD content - something that Universal president Craig Kornblau does not deny. "I'm not going to tell you that we don't cut financial deals with people every day," he's quoted as saying in the piece. Now, there's nothing wrong with that. A lot of studios have similar arrangements. But it does speak to Universal's motivations in prolonging this format war. And make no mistake about it, Universal is prolonging this format war to keep HD-DVD alive, in the face of mounting evidence that the majority of consumers interested in high-def discs are choosing Blu-ray instead.

Kornblau further claims (according to the article) that Universal's position in the format war is driven by a long-term and consumer-focused strategy that is supported by Universal parent NBC and corporate owner GE. And that's interesting, because Universal's Ken Graffeo gave a different impression about GE's support of Universal's position in the format war at our HD-DVD panel discussion at EMA. Here's the relevant exchange. It starts with a statement by an audience member, one of our group who attended EMA, which soon becomes a question...

Audience member: My question is, from the studio perspective, are you feeling the pressure of being the only HD-DVD sole studio?

Graffeo: Don't forgot about Weinstein.

Another audience member: Major studio.

Audience member: Major studio. Can you talk to that?

[unintelligible comment from a panelist or audience member]

Graffeo: I feel it every day. [audience laughter] And I will also say that we're owned by GE, so we do hear about it a lot. [more audience laughter]

Graffeo then goes on to comment in further detail about the format war, and the European market, etc. You can listen to an MP3 clip of this specific exchange here, and we've posted a 27MB zip file containing a much longer recording of the panel discussion here, in addition to the videos available on HTF (between the videos and these MP3s, you should have a near complete record of the panel discussion).

Now, when I heard this answer, I was pretty surprised. Graffeo seems to be implying that GE has concerns about Universal's stance in this format war. If you watch the videos of the panel, you'll know that I asked a number of direct questions of the panelists related to the format war (I'm the guy in beige in the audience), and I was prepared to continue doing so. But when Graffeo answered this question, in the way he did, I actually felt bad for the guy. It was clear to me, and to others who were on hand to witness the exchange (and I've confirmed today that many others who were there shared the same impression), that Ken (and Universal as a whole) is under a LOT of pressure related to his studio's exclusive support of HD-DVD. Variety has even reported on this in recent weeks. So at that point, I throttled back in my questioning. But his comments would seem to be contradictory to those of Kornblau from Scott Hettrick's piece.

[marzetta7]

Contd...

There's another issue here that's worth mentioning as well. Just a few minutes before the exchange above, Graffeo was asked by an audience member about the possibility of Steven Spielberg's films appearing on HD-DVD. I believe it happens at the end of video clip #4 on the HTF. Now... you may recall that earlier this year (on 1/29 to be exact), the HD-DVD Promotional Group had listed a number of Spielberg films on their website with the suggestion that they were "Coming Soon" to HD-DVD, including Jaws, E.T. and Jurassic Park. But shortly after they were posted, which caused an understandable stir, the Group removed the titles from the site and posted a retraction. To my knowledge, nothing more on the subject of Spielberg on high-def came to light until Graffeo was asked by an audience member (at the EMA panel two weeks ago) about the possibility of Spielberg films on HD-DVD. Here's his answer:

Graffeo: In regards to the Spielberg, um... it wasn't... Steven wanted to wait for DVD til there was a higher penetration for that. Um... right now, with 100... 200,000 players and 150,000... he wants to wait til there's more penetration. Because, um... you know when you do release... and Jaws was the first Steven Spielberg that we came out with, and at that time we released we sold a million units. More than we'd ever sold on VHS. But you have to have, sort of like... I don't want to say critical mass, because you had close to 3 or 4 million households that had players... but it's too early now. And I think we have to work very close with our filmmakers because they have a very big part in what we do.

Okay... I bought that argument and I think so did everyone else at the panel. And that would have been the last word on the subject... EXCEPT that just a week later, Sony announced at Comic-Con the first Steven Spielberg film to be released on high-definition, Close Encounters of the Third Kind, EXCLUSIVELY on the Blu-ray Disc format (on 10/2). Huh? Something doesn't jive here. Given his position within the industry, and Universal's close ties with Spielberg over the years, how did Graffeo not know this was coming just a week later? And for those of you who would say that Sony controls CE3K and not Spielberg, I was told directly by Sony reps at Comic-Con that Spielberg personally approved the high-def transfer of the film. Not only that, he's recorded a new interview just for the Blu-ray release. So he HAD to have approved this. How does Universal not know that was coming? In what light does that cast Graffeo's comments at EMA from just a week earlier? And, maybe even more to the point, what does it say about Spielberg's opinion of, and position on, this high-def format war, when his first high-def disc release is a Blu-ray Disc exclusive? Add to that Lucasfilm producer Rick McCallum's comments from a few weeks ago at the Star Wars Celebration convention in Europe, to the effect that if Hollywood doesn't get its you-know-what together and end this format war soon, Lucas might bypass high-def discs altogether and release the Star Wars films in high-def via download only. What does all that say about how good this format war REALLY is for consumers, regardless of Universal's belief that having helped to drive hardware prices down so quickly justifies their position? Who, at this point, does continuing this format war really benefit?

I have to tell you, folks... after our experience at EMA, and after the many revelations and announcements at Comic-Con in the week following, we remain more convinced than ever here at The Digital Bits that Blu-ray Disc is going to win this format war. It's clear to us that Universal is under significant pressure to go format neutral, even from their own parent company, and this pressure is only likely to increase as we approach the holidays. Universal's position as the sole major HD-DVD exclusive Hollywood studio is growing ever more precarious.

The fact is, high-def software sales continue to favor Blu-ray by a 2 or 3 to 1 margin, and the announcements of BD exclusive titles like Spider-Man 1-3, Pirates: Dead Man's Chest and CE3K are only likely to increase consumer and retailer interest in Blu-ray. That director Steven Spielberg would allow his first high-definition title to be Blu-ray exclusive is a significant development. The biggest HD-DVD announcement at Comic-Con was CBS's Star Trek: Remastered, which has priced itself right into the stratosphere. And the news that Target stores and BJ's Wholesale are going Blu-ray exclusive in time for the holidays would seem to us a rather strong indication of the overall retail industry's desire for this format war to be over.

What's more, with sales of Warner's 300 now selling 65/35 in favor of Blu-ray, despite the effort by the studio to create genuinely interesting HD-DVD exclusive interactive content (see this piece at USA Today), it seems all too apparent that consumers are making their format choice known to Hollywood. Indeed, we're receiving more inquiries than ever before from readers who have decided to get into high-definition, and want our advice on purchasing the right Blu-ray player - a trend that reminds us strongly of a similar surge of interest in DVD in the final days of Circuit City's DIVX pay-per-view format. And after all of this, we remain firmly convinced that the moment Universal announces that it's going to start supporting both Blu-ray Disc as well as HD-DVD - a move we see as inevitable at this point given continuing software sales trends - the mainstream press will declare the format war over and Blu-ray the winner. Retailers will quickly reorganize their sales efforts towards Blu-ray and away from HD-DVD, if they haven't already, and this thing will be done.

That's not to say that HD-DVD will disappear. Studios that currently support the format will probably continue to do so. But most retailers will likely not be as friendly. And as Blu-ray hardware prices continue to drop moving into 2008 and beyond... the choice for the vast majority of consumers interested in high-def on disc will be even more obvious than it already is. Keep in mind, all of this is playing out without a SINGLE new Blu-ray title announcement from Fox or MGM... and Fox continues to tell me that new announcements ARE coming.

It seems to us as if the writing is starting to appear on the wall. Completely setting aside personal feelings about Sony or Toshiba or Microsoft, how anyone can continue arguing at this point that HD-DVD is going to win this format war is hard to comprehend. At this rate, it's our belief that the best HD-DVD can hope for is to survive. This is nothing personal, folks... it's just the way we see it.

[Y3k Bug]

Could someone do a quick copy and paste of it in this thread for those who can't seem to open the page? (yep, that includes me)

nevermind

[Esox50]

Originally Posted by TheDigitalBits

Keep in mind, all of this is playing out without a SINGLE new Blu-ray title announcement from Fox or MGM... and Fox continues to tell me that new announcements ARE coming.

We've heard this before from numerous sources. I'm at the end of my patience with waiting for Fox. They officially don't support Blu-Ray at this point (as far as I'm concerned), and IMHO are the laughing stock of this format war. Even more so a laughing stock than Universal who at least attempts to back up what they say (no matter how futile we all know their efforts will be).

[blublublu]

Originally Posted by Esox50

We've heard this before from numerous sources. I'm at the end of my patience with waiting for Fox. They officially don't support Blu-Ray at this point (as far as I'm concerned), and IMHO are the laughing stock of this format war. Even more so a laughing stock than Universal who at least attempts to back up what they say (no matter how futile we all know their efforts will be).

The first test for Fox will be their next major release on DVD.

Frankly they haven't had a major new release since "Night at the Museum" (as far as I recall), and I'm not sure what the next one would be besides the last Die Hard.

I can't see how they would not release this and The Simpsons on Blu Ray.

[JTK]

Originally Posted by Esox50

We've heard this before from numerous sources. I'm at the end of my patience with waiting for Fox. They officially don't support Blu-Ray at this point (as far as I'm concerned), and IMHO are the laughing stock of this format war. Even more so a laughing stock than Universal who at least attempts to back up what they say (no matter how futile we all know their efforts will be).

It'll all be worth it come Christmas time.

Great comments by Mr. Hunt, as usual.

[ReduxInflux]

awesome. thanks.

[Jim L]

By these repeated comments of folks like Bill Hunt and others who know insiders, they're definitely coming back.

• I saw that video of the Fox studio representative at a Java Developer's Conference (that was a short while ago.) Fox was actively recruiting developers to do BD-J applications for interactive movie content.
• They're also still advertising their BD titles.

By these bits of evidence I suspect that they are as gung-ho about Blu-ray as Disney is.

And like we've all heard before, they're waiting for final testing and implementation of BD+ because they're more concerned about piracy than any of the other studios.

I suspect that they are still readying transfers and doing other things behind the scenes that we can't see right now.

When the titles come, it will all be worth it! Patience.

[hyperdine]

Originally Posted by Esox50

We've heard this before from numerous sources. I'm at the end of my patience with waiting for Fox. They officially don't support Blu-Ray at this point (as far as I'm concerned), and IMHO are the laughing stock of this format war. Even more so a laughing stock than Universal who at least attempts to back up what they say (no matter how futile we all know their efforts will be).

I understand the frustration here, but I can assure you that Fox is definitely behind Blu-Ray. Hollywood in High-Def just launched their site recently and Fox is one of the companies providing support for the site. If you sign up there, you'll notice that the sign-up email process actually utilizes Fox resources/assets. Fox would not be pouring resources into a new website dedicated to Blu-Ray if they were not fully behind it.

Granted, they haven't released any titles in a couple months, but that doesn't mean they've abandoned Blu-Ray...far from it. I agree that it would be better if Fox were releasing titles right now, but remember...one of the main reasons Fox chose Blu-Ray over HD-DVD is the safeguards against piracy. If it takes perfecting BD+ in order to alleviate their piracy concerns, then I'm happy to wait.

There's no way that Fox will let the holiday season go by without releasing any titles on Blu-Ray. No way. Don't forget how Fox sprung the X-Men Last Stand surprise last year when the PS3 was launched. They literally gave something like one or two weeks advance notice (oldtimers, correct me if I'm wrong here).

Have no fear...Fox will be here!