Blu-ray economics 101

[JadedRaverLA]

Originally Posted by paidgeek

The player pricing debate is tough for me because I see it as a race to the bottom. If hardware companies can't make a dime (or in fact have to subsidize) in order to sell players, then where do they go from here? We have a symbiotic relationship between hardware and software. The fact that a companies pride can get the better of their sensibilities is a pity. Is a $200 price difference so much compared with the rest of the investements you make in your display or audio reproduction chain? To get a good HD video/audio experience you can easily drop $5K or more, does it make sense to fret over $200 for the device that will feed that system? I don't think so...

I agree, though I'm starting to have reservations. With HD DVD players retailing at $299, I really don't pay too much attention. When they're widely available in stores for $199 (and $169 on Black Friday), there are A LOT of people who would otherwise not care who may be tempted to jump in. Fortunately, I think that unless the HD DVD camp does domething major regarding disc pricing, most of those players will used (nearly exclusively) to play upscaled DVDs. But if Warner is really looking at player sales in Q4, it could be a big boon to the HD DVD format.

Personally, I think the $399 40GB PS3 is a great start at getting the Blu-ray players where they need to be, but basic standalone players need to be at that price (instead of $499), and, there needs to be some decent sales for the holidays bringing those prices closer to $300 to make sure Blu-ray dominates holiday sales.

Just my $.02. What do insiders think?