Friday, May 9, 2008

Blu-Ray’s Market Dominance Will Be Delayed – Research Firm

Even though almost a quarter has passed since Toshiba stopped to promote or develop HD DVD video format, sales of competing Blu-ray disc (BD) players did not increase substantially due to high prices. Moreover, a research firm predicts that it would take another year or even eighteen months for Blu-ray hardware to start selling much better and reach their full potential.

“BD player prices remain high, and supplies are limited. This is good for the market because most current players do not support all the functions that studios place on the discs. Lacking support for – or upgradeability to – BD Live! or Bonus View (picture in picture), consumers cannot utilize all the available options. Manufacturers would rather sell more fully-featured models,” said ABI Research principal analyst Steve Wilson.

According to ABI Research, it will be 12 to 18 months before the market of Blu-ray hardware (and, consequently, movies) kicks into gear. Consumer electronics manufacturers need to introduce full-featured players and then get prices down to the $200 level. Until then, non-HDTV owners will certainly favor standard definition DVD players.

Additionally, a depressed economy in the United States could also lead HDTV and prospective HDTV owners to opt for up-converting standard players as they delay buying higher-ticket CE items. Finally, Blu-ray movies come at a substantial premium over standard DVDs, although studios have brought prices down to the low $20-range for some titles.

The market research firm claims that optical disc drive manufacturers have lowered their prices for computer BD-ROM drives in an effort to kick-start adoption in the PC market. But since Blu-ray disc drives, priced three to four times higher than red laser drives, also require relatively advanced microprocessor, graphics adapter and large monitor/HDTV to display Blu-ray movies properly, their adoption will likely be inline with PC replacement cycles and is likely to struggle in entry-level products.

In 2008, Sony PlayStation 3 video game consoles will make up over 85% of the BD players in the field. This lead will continue until 2013 when the installed base of CE- and PC-based BD players finally overtakes the installed base of PS3s.

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