Sony’s firm faith in the Blu-ray format corpse
Replying to the speculations of analyst Mike Hickey, which forecasted the marketing of a cheaper PlayStation 3 edition without the costly embedded Blu-ray drive, Sony was resolute in specifying that the simple idea would be absurd and would kill “the backbone” of the console because games are built just upon the BD format. “Blu-ray will always be part of PS3“, Sony says, but the market environment and the slow, too much slow growth of high definition disks sales allow to easily predict the fact that within the years to come such model will be only valid for the videogames of the Japanese console and very little more.
Big Corp. hopes
Blu-ray died at Christmas 2008, though the industry hasn’t noticed yet and continues to put money in development and promotion of the hi-def optical technology. Digital Entertainment Group, the trading organization originally born to promote the DVD standard, spent 25 millions dollars in the pre-Christmas period to raise the consumers awareness on the Blu-ray format existence. Sony, for its part, landed in China with the cautious release of the first movie titles and the opening of a manufacturing plant in Shanghai.
Other than cutting the manufacturing costs, the plant will be useful to Sony for better representing its format in the Asiatic country, where rather than of BD disks there is a huge sale of pirated media (coded in AVCHD format but recorded on traditional DVD disks) and surely the average consumer can’t afford purchasing any Blu-ray player and movies at the cost of 205 yuan (ca. 30 dollars) each.
Sony isn’t alone in continuing to believe in the Blu-ray success, and technology improvements for the format that defeated Toshiba’s HD DVD come from corporations like Panasonic, that in the past months proposed a standard for the 3D high definition to the Blu-ray Disc Association (BDA). Theoretically ready for use within 2010, the Panasonic 3D HD joins the former Pioneer proposal and would like to be conservative in the amount of adjustments and additional devices to pile up together with the already crammed high definition paraphernalia, a promise broken in the same moment in which it is made because the standard would need a new HDMI connection port to properly work, therefore forcing to replace player and TV-set.
Much more interesting than the nth couple of useless 3D glasses that periodically threaten, through the decades, to set off headaches outbreaks with no luck is Pioneer’s work on BD media, or at least on a type of disk that starting from the Blu-ray format specifications go as far as compacting 16 different recordable layers on a single media, for a total of (16×25 GB) 400 Gigabytes of data. The prototype, showed at Taipei in December, is the result of the efforts that Pioneer is since making to achieve high capacity optical storage solutions.
The 12 cm, 400 Gigabytes disk should become a commercial product within 2010, with the rewritable version to follow by 2012 and an evolution of the media featuring 1 Terabyte of capacity within 5 years. Pioneer explains that the company has currently no intention to propose the technology for the adoption within the Blu-ray specs, and present BD-compatible players and devices wouldn’t be capable of reading the new disks anyway. Things could possibly change with some firmware upgrade for the drives, and in this case the PS3 console would be the ideal candidate to extend compatibility to disks that, in any case, seem to be meant mostly for backup and data storage applications.
In these months not even Sony missed the opportunity to present novelties and improvements for the Blu-ray technology, in particular a hybrid BD disk capable of containing a PS3 videogame and a high definition movie at the same time and wireless home theater devices based on the Wi-Fi standard. In the first case the Japanese multinational hopes to improve the poor appeal of its console as a home video machine, while the second proposal is aimed to whom doesn’t like to stuff his own living room with an unaesthetic tangle of electric wires.
Industry’s faith in Blu-ray would seem legitimate if one takes into account the constitution of a single worldwide company for management and grant of licenses needed to make players and disks, a fact that will bring the reduction of 40% of royalties price and a consequent increase for companies’ incomes. At bottom Blu-ray is going very well in Japan, where in 2008 BD recorders would have taken more that 50% of the market in detriment of DVD recorders.
A bitter reality
Blu-ray passed the 1000th release in the United Kingdom with the “Platinum Edition” of Disney’s Pinocchio, thus how could it fail in becoming the hit that consumer electronics giants and Hollywod majors always hope for? The dimension of the likely Blu-ray failure as DVD successor can be read within the same numbers with which the industry publicizes the “success” of the blue laser format. The “highly significant milestone” of the thousand titles sold in UK, for instance, was achieved in 28 months while DVD made it in less than two years.
The stink of the Blu-ray corpse exhales from the data provided by the aforementioned Digital Entertainment Group and concerning the value of USA home video market from 1999 to 2008. According to such information the DVD format value continued to fall from 2006, the higher peak year (24.1 billions of dollars), to 2008 (21.6 billions). In comparison Blu-ray grew from 270 millions in 2007 to 750 millions in 2008.
But how I already stated in previous occasions 2007 is not 1999, and if DVD was able in a year to go from a market value of 800 millions dollars to a value of 2.5 billions, ousting in a short time analog VHS videotapes, it is highly probable that Blu-ray’s growth will continue to be an extremely limited percentage of home video for the years to come.
According to a Futuresource study, the Blu-ray format should arrive to control a little more than 50% of media market within 2012, but even then DVD will remain one of the driving forces of home entertainment at more than 10 years from its introduction. The future, moreover, isn’t straightforwardly moving toward the success of the blue light standard, because other than DVD Blu-ray must and will have to face the growing offer of alternative solutions to enjoy multimedia contents, satellite or cable channels, mobile devices and digital delivery on the Internet.
While taking into consideration the latter possibilities, predictions on Blu-ray as the protagonist of the retail market within 10 years get an actual value that is much lower than the esteems currently featured by the DVD standard, with the remaining consumers’ money spent in services other than optical media and in other entertainment fields. Fields like the videogaming one, that in 2008 already surpassed the value of DVD plus Blu-ray by summing up, according to Media Control GfK International, 53% of the overall 61 billions dollars of the media industry.
Blu-ray’s fate is written, the high definition format is destined to succumb because of the wrong choices of an industry that wasted years with the useless diatribe between HD DVD and Blu-ray, allowing digital delivery to gain a space that in the end will be critical. Blu-ray will die because of the mediocrity of the design of a standard ridden by ridiculous DRM measures, a standard thought to satisfy only the paranoid impulses of the executives of failing corporations rather than the real consumers’ needs.
How Sony will manage to disentangle itself from one of its most colossal failures, if the company is now obliged to take into account an overall loss (for the first time since 1995) of 1.68 billions of dollars at the end of the fiscal year and with a devastating economic crisis that forces to make unprecedented cuts and reorganizations, is a question that deserves being observed very closely.
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