NEW YORK, NY — Sony’s high-definition Blu-ray DVD format may have sent Toshiba’s rival HD DVD format scurrying from the battlefield in defeat, but that doesn’t mean Blu-ray has won the hearts and minds of consumers — at least not yet. In fact, according to ABI Research, it could be the middle of next decade before Blu-ray becomes a viable format in terms of consumer adoption.One of the primary challenges facing Blu-ray, according to ABI principal analyst Steve Wilson, is many consumers are not dissatisfied with the quality delivered by their conventional DVD players.
“We are starting to see an increase in the number of DVD players with built-in ‘upconverters’ [algorithms that scale standard DVD resolution to look better on high-definition televisions], and the video processing is getting better with each new generation,” Wilson said. “Today about 35-percent of all DVD players sold include upconversion. ABI Research expects that figure to climb to about 60-percent by 2013.”
Further, the state of the Blu-ray player market is not all that encouraging, Wilson noted. Most of the Blu-ray players in homes today are embedded in Sony’s Playstation 3.
“The studios [had] better hope that people are playing movies on their Playstations,” Wilson said. “Otherwise there’s very little installed base. In 2008 about 85-percent of the Blu-ray players in the market will be found in PS3s. The dedicated consumer electronics and PC-based types of Blu-ray players won’t catch up in terms of market share until about 2013.”
In an effort to spur the market, optical-disc manufacturers are lowering prices, and PC manufacturers are offering lower-cost configurations. Bare-bones PCs with Blu-ray players are arriving, but they remain cost-ineffective, according to Wilson.
“If you’re only going to spend $500-600 on a PC, are you really going to spend 40-percent more for a built-in Blu-ray player?” he asked.
Meanwhile consumer electronics manufacturers are maintaining high prices for dedicated players.
“The studios had hoped to have settled the war,” Wilson concluded, “but I think they’re going to be disappointed when they don’t see the volumes of players [in consumers’ homes] going up they way they would have liked.”
