The Hard Road Ahead Of Blu-ray

April 9th, 2008

James McQuivey, PhD VP, Research Director

With contributors:

J. P. Gownder , Michelle de Lussanet , Dan Wilkos

Summary

In February, Toshiba officially threw in the towel and gave up its efforts to establish HD-DVD as the HD disc format of the future. To the victor — Blu-ray — go the spoils of this ugly format war. But just what those spoils are is still a big question. Winning the HD format war is like winning a minor league baseball championship: It might mean a lot to the team, but it's not where the money is. Instead, DVDs will continue to dominate the recorded media market, despite Blu-ray's technical superiority. Rising competition from digital downloads and video on demand (VOD) only turns up the heat. Blu-ray could do well in 2008, selling as many as 2 million non-PlayStation 3 (PS3) units, but only if prices come down, content lists bulk up, and makers focus on marketing the value that matters most to likely buyers: watching great movies.

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