Quote Originally Posted by Feanor
The correlation between lower production costs and lower prices is a loose one at best. It's competions that leads to price drops, not lower costs.

So on the hardware side, there will be livelier competion and price drops. But on the software side, it's not so clear -- after all, each movie or whatever that is released is unique to the publisher: there's no Spiderman vs. Spiderman competition. A quick drop in sofware prices isn't a foregone conclusion.

It didn't happen for CDs even though for most people CD was seen as a clean replacment for LPs. Ok, maybe price colusion was a problem in that case or maybe it wasn't the main thing. As for DVDs, they were such a huge improvement over tape that people see them as a clean replacement too. DVD prices dropped only after the publishers had skimmed the suckers, er, sorry, early adopters and decide more profit was to be made from volume.

When DVD came a long, all you need to get into it was a DVD player. But in the case of Blu-Ray, you also need an HDTV and they're a lot more than the players. Ergo, maybe for this reason the adoption cycle could be a lot longer than for DVD so the sucker-skimming phase will be accordingly longer.
Feanor,
I have purchased(and been given in some cases) over 340 titles from both formats since their inception. I have watched prices go from $30-37 over a year ago, to an average of $20-25 today. We are already seeing disc prices drop faster than they did with DVD in this point in its history. Being that I know how much is cost to author and replicate the Pirates series, and can tell you right now it is alot more expensive to do than DVD was early in its history. What they are doing on the discs are alot more sophisticated than DVD. The authoring tools for HDi and BD-j are still very expensive, and programmers for both still cost alot of money. I cannot see any studio gouging customers right now. It is still early in both formats history, and cost associated with producing titles must be driven down by economies of scale. That has not happened quite yet. However, with just one format now(and truely HD DVD life is over), the studio are quite aware that lowering disc prices will be essential for mass adoption. In reality, it is just too soon to expect the costs of bluray disc to be the same as DVD's to consumers. But as more consumer buy bluray discs, that will change pretty quickly.