The State of Blu-ray and HDTV 2012

[Woochifer]

In the face of a declining market for disc media in general, Blu-ray continues to grow as a format. But, I think it's safe to say now that it won't displace the DVD format anytime soon, if ever, before the transition over to online/networked options takes hold.

If anything, Blu-ray is quietly making its market gains by attrition, well under the radar of the tech press, which never took a liking to Blu-ray to begin with since tech writers are generally obsessed with streaming. Considering how little buzz Blu-ray gets nowadays, the market gains are noteworthy. Here's the rundown of the latest market trends, as Bill Hunt of the Digital Bits noted in his report from CES last month.

My Two Cents - Archived Posts (1/16/11 - 12/16/11) (http://www.thedigitalbits.com/mytwocentsa200.html#011312b)


Blu-ray has now reached 36 million homes in the U.S., which represents about 33% of all U.S. TV households. There's been a 40% increase in 2011 over 2010. (IHS Screen Digest)

40 million Blu-ray capable devices are now in U.S. households. The difference between 40 million units and the 36 million homes figure cited by the BDA is that some homes have multiple devices. (DEG)

Blu-ray software sales increased 33% in 2011 over 2010. (IHS Screen Digest)

Of the Top Ten Home Video Software Titles in 2011, over 40% had a Blu-ray Disc in the package (standalone BD movies and BD/DVD Combos). That's a 27% jump over 2010. (IHS Screen Digest)

A 40% increase in any given year is an impressive growth trend. However, Blu-ray is now in its 5th year and its growth does not show the accelerated "hockey stick" growth trend that we saw with the DVD. By the DVD's 5th year, it was very clear that the format would supplant the VHS format sooner than later.

Of course, the flip side to this is that the Blu-ray format has solidified its market position. Blu-ray might not take over the market, but it certainly won't go away either. This past holiday season was the first time that I didn't run across any Blu-ray doomsday predictions from the tech press. Of course, them acknowledging Blu-ray's continued existence would call attention to all the other ignorant idiocy that they wrote in past years.

Some of the updated market projections are also noteworthy.


It's estimated that by 2013, virtually all new Blu-ray players sold will have 3D capability. (Futuresource)

Nearly 75 million U.S. homes now have HDTVs. That represents about 65% of U.S. TV households. (Futuresource)

By 2014 over half of all new HDTV displays will have 3D functionality. (Futuresource)

The initial 3DTV adoption rate is exceeding that of regular HDTV. (Futuresource)

And herein lies the retort to all of the 3D naysayers who've been predicting its demise as well. I've been stating all along that because 3D entails refinements to existing HD standards, it won't be long before 3D is simply a standard issue feature, rather than an extra cost option. The projections by Futuresource seem to support this -- standard on "virtually all new" BD players by 2013, and "over half of all new HDTV displays" by 2014.

The adoption rate for 3DTV is kind of a non-starter, given that HDTV was a very slow seller in the beginning. Unlike the DVD, which blew out of the gates quickly and rapidly became the standard for home video, HDTV took many years before sales took off. The initial sales rate for HDTV is not a high standard to beat.

[Mr Peabody]

The stats seem to support what I found Saturday to my surprise, I went to rent a certain movie at Blockbuster on Blu-ray, they had one copy and ov course, it was out, although there were a few copies of DVD. I asked the buy if they rent more DVD than BR and said by a large margin. I couldn't believe it.

I have my doubts about the 3D prediction. Everything I see around me indicates not a lot of interest or knowledge of it. Maybe in the techy world but not the real world.

[Woochifer]

The stats seem to support what I found Saturday to my surprise, I went to rent a certain movie at Blockbuster on Blu-ray, they had one copy and ov course, it was out, although there were a few copies of DVD. I asked the buy if they rent more DVD than BR and said by a large margin. I couldn't believe it.

Question here though is whether that's a function of supply or demand. Given that the wholesale cost of a BD title is higher than the DVD version, and Blockbuster does not charge extra for the BD version, they have an incentive to stock fewer BD copies. For most of their customers, I would guess that if a BD title is out of stock, the customer would simply opt for the DVD version (if they want to watch that movie in particular right now) or look for a different BD title (if they want to watch a movie in HD right now).


I have my doubts about the 3D prediction. Everything I see around me indicates not a lot of interest or knowledge of it. Maybe in the techy world but not the real world.

Why would you have doubts about the 3D projection? Did you read my post? The projection IMO is spot on because by 2014, most HDTVs will simply include 3D as a standard function. As I said, the 3D feature is simply an extension to the existing HD standards. Virtually all new video processor chips already include the MPEG-4 MVC extension, so it's only a matter of whether the feature is activated and how it's implemented.

In much the same way that right now you can barely find any TVs without HD, in a few years you'll be harder pressed to find TVs without 3D capability. It's no different than how DTS turned into a standard feature on HT receivers and disc players, after initially only being available on higher end components.

[Smokey]

But, I think it's safe to say now that it won't displace the DVD format anytime soon, if ever, before the transition over to online/networked options takes hold.

Does that mean your argument of "retailers don't like double inventory" is out of window :D

Even if streaming/downloading takes hold, there still has to be a physical format for movies and bluray is it. DVDs eventually will be phased out as more titles becomes more available on bluray. But right now DVD seem to hold steady due to its price point being much lower than Bluray.

I just got back from Walmart (took LG BD player back), and most of their DVD inventory is below $10. Where majority of Bluray discs are priced above $10.

[Woochifer]

Does that mean your argument of "retailers don't like double inventory" is out of window :D

How's it an argument? That's simple fact. Retailers don't like carrying dual inventories, period. But, they also won't get rid of one product line in favor of another, if the revenue growth for the newer format does not show accelerated growth. Blu-ray grew by 33% last year, which is impressive until you compare that with the DVD, was still growing in the triple digit range in its 4th year. If Blu-ray grew by triple digits last year, then retailers would most definitely be ready to phase the DVD out in rapid succession. Recall that Best Buy had already cleared out their VHS inventory before the DVD had achieved majority market share.


Even if streaming/downloading takes hold, there still has to be a physical format for movies and bluray is it. DVDs eventually will be phased out as more titles becomes more available on bluray. But right now DVD seem to hold steady due to its price point being much lower than Bluray.

I just got back from Walmart (took LG BD player back), and most of their DVD inventory is below $10. Where majority of Bluray discs are priced above $10.

The issue for Blu-ray is whether the clock will run out on physical disc media before they supplant the DVD. Blu-ray players have outsold DVD players for more than two years, and that trend will not change.

The cost issue only applies with new releases. With older DVD titles, they are marked below $10 because otherwise there's minimal demand for those titles.

If new release Blu-ray titles are released at the same cost as DVDs, then we might see some more meaningful movement. Right now, the trend is for Blu-ray releases to equal or even outsell the DVD versions for the big blockbuster movies. But, go further down the release table into lower grossing movies, and the Blu-ray versions will account for only about 20-25%. It's with those lower demand new releases that Blu-ray can make greater sales gains. But, not if the studios continue to price the Blu-ray versions upwards of $10 more than the DVD.

[LeRoy]

Hey Wooch, I am one of the lackey's that never jumped into Blue Ray or HD TV's of any kind. I have about 700 DVD's in my movie library, the Toshiba Tube TV 32" still works great, and so does my pre-HDMI Arcam AVR, and Marantz DVD Player.

So, I am glad to know that 3D TV's will someday soon become a standard issue. I wonder when this happens if we will see TV manufacturers require special cabling to make it all work.

[Woochifer]

Hey Wooch, I am one of the lackey's that never jumped into Blue Ray or HD TV's of any kind. I have about 700 DVD's in my movie library, the Toshiba Tube TV 32" still works great, and so does my pre-HDMI Arcam AVR, and Marantz DVD Player.

So, I am glad to know that 3D TV's will someday soon become a standard issue. I wonder when this happens if we will see TV manufacturers require special cabling to make it all work.

Well, you're at a point right now where HDMI is almost mandatory if you're adding any new equipment. HD analog component video outputs and inputs are on their way out (only composite 480i analog video is still standard issue). All Blu-ray players introduced since January 2011 no longer include component video outputs, and other components out there also no longer support analog component video.

If your DVD player breaks, and you want something better than a bare basic player, you have to buy a Blu-ray player. Mid-level and high end DVD players are no longer made, and quality conscious manufacturers like Denon and Oppo stopped making DVD players at least two years ago.

When/if you go HD, right now you by and large have to upgrade the entire chain. When I (finally) went HD three years ago, the market was still in the transition phase, so it was easy to mix and match pieces. That's no longer the case.

Since you have not made the upgrade to HD yet, you will have to prepare for using HDMI for your entire AV chain. I still use an older AV receiver, and a HDMI auto-switch. It works fine, but the Oppo HDMI switch that I use is no longer made, and I don't see models of comparable quality available anymore.

As with all things digital, you'll always wind up with something better and cheaper if you wait. I basically waited until affordable 1080p plasma HDTVs became available before upgrading. But, when I made the HD transition, I upgraded to a HD satellite receiver and Blu-ray player at the same time.

With 3D, you're looking at the same thing. Just as 1080p support became ubiquitous, I see the same thing happening with 3D. It doesn't matter if you plan to take full advantage of the feature, it will simply be there.

Of course, the flip side to waiting is that you're stuck with analog SD resolution in the meantime, and that's increasingly problematic with more and more programming now framed for 16:9 aspect ratio, and cable systems beginning to eliminate analog conversion of broadcast channels.