Blu-Ray wins...maybe
With Wal-Mart and Best Buy backing Blu-Ray, it certainly seems like HD-DVD has gone the way of Betamaxx and DivX.
Now they'll have to fight against digital downloads. This New York Times article acknowledges that digital downloads are the next big threat to the Blu-Ray format. I wonder how far off it really is though--certainly the Blu-Ray spokesman is going to be pessimistic about any threat to the DVD market. This particular service sounds intriguing to me. Or maybe if Apple's iTV ever catches on.
In the short term, I suspect everything will depend on what the relative equipment costs will be. The price of Blu-Ray players will have to drop pretty fast if it's going to become the dominant media format for a significant period of time. But in the long run, I think consumers will pay the premium for the convenience of downloads. I wonder how much money has been invested into Blu-Ray and how long it would take for Sony to profit off it.
4 Comments:
Looks like it's really over now as Toshiba stops making HD DVD. But as you suggest, will anyone care? PS3 sales are improving and the prices of blu-ray players have been dropping. Will that be enough to get people to catch on? I think that with one format, we will see even more marketing now for next-gen.
Digital downloads are going to be in a quagmire until there is a better standard adopted. There are a lot of neat things you can do with digital media but right now, too many different formats are involved. The pieces are in play but no one company integrates them all together. More than just on demand is the drive for portability.
-TiVO content can be downloaded to your portable video player (iPOD, PSP) or laptop
-Slingbox allows you to watch your TiVO, DVR or cable box remotely from a laptop (as does Sony's location free player)
-Apple TV allows you to rent and buy movies that you can also play on your computer and iPod
-PSP can remotely view media, play PS1 discs that are on your PS3
-Nearly every media company, and Netflix, have some downloadable content model for free (Hulu, Joost, AOL video, individual websites) or for purchase (NBC, Amazon, Apple)
-Some DVD's are now including digital copies of the material that you can download. Sony plans to have a blu-ray to PSP download capability available later this year.
-PSP's got a tv tuner overseas
-PS3 is supposed to have DVR capability overseas
It's going to be tough to put all these pieces together, especially with Apple, Sony, Microsoft and all the big media conglomerates fighting to determine who will control the distribution and more importantly, who will profit from everything.
Will we be able to buy just one box that records content, allows permanent or temporary downloads (of movies, tv shows, etc), can transfer those downloads to any player, and allows for remote viewing?
I think that in this case, competition and copyright law are basically creating obstacles to this media portability, but we'll eventually get there. Who knows where Blu-Ray will fit into all of that.
I agree digital downloads are in a quagmire, and who knows where it goes from here. There are a lot of obstacles, but there's enough value in the concept that there's good incentive to get it done sooner rather than later.
As you say, it will come down to the media conglomerates working out who gets what. As always, cost and price drive everything and will determine if the consumer embraces it or not. Blu-Ray is definitely ahead of on-demand here, but for how long? VHS reigned for 15 years, DVD for about 10 (so far)--I don't expect Blu-Ray to dominate the home movie market for that long. Blu-Ray sales/rentals will hurt once on-demand is worked out. Even if it takes 5 years to set up a business infrastructure for downloadable media, that's still bad news for Blu-Ray.
The other part of the equation that intrigues me is the possibility that digital downloads don't need to be dominated by any one provider, because the specific digital media format isn't really that important. After all, if the content is in digital form, it's easy for a set-top box to have the software capability to play any format, unlike disc players which require costly hardware to support differing media standards.
As you say, it should be easy for any set top box to play any format, but it's not. Apple will to try and hold on to their proprietary formats until they are forced to do otherwise - see iTunes and the iPod. Same with Microsoft. Throw into the mix digital rights and fear of copying and this could be a really prolonged problem.
The other problem Blu-Ray faces is that they really need to convince consumers that anything they invest in purchasing will work on future players or hardware. People are not going to want to replace their collections yet again and again as the newer technology comes out.
Digital downloads face the same problem of permanence. I'm guessing that as people get new computers every 3-5 years, they don't necessarily hold on to all their digital content. Or maybe they do?
On the other hand, do people even want to own digital downloads of random TV shows as long as they hold on to songs? Music has a much higher replay value. Maybe people just expect not to have to hold on to so much TV. This might be the buying pattern and disposable attitude. My parents' generation certainly does not think that way, but maybe this new one does.
I understand that every provider wants their proprietary formats. I guess I don't understand why these guys dictate the terms.
Why should studios care about the media format? I can see why there might be headaches trying to support multiple formats for disc media, since it's a physical object that needs manufacturing. But in pure digital format, it seems that the cost of supporting multiple formats isn't as great. Perhaps I don't understand the business.
I do see why studios have an interest in media formats, as the right format can help prevent piracy. Perhaps this is the financial incentive for them to commit to one format exclusively.
I'm unsure how the issue of permanence plays out here. Seems like keeping your digital content isn't a particularly tough challenge if there is consumer demand for it.
Ultimately, yes, there are a lot of challenges, and the business is a bit of a mess right now. But ultimately, it seems clear to me that while Blu-Ray will have its place, on-demand services offer much more value to the consumer, so the incentive to sort it out is high. The only caveat is if we enter a severe recession and consumers become unwilling/unable to invest in next-generation media equipment.
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