Sony Game machines and Video Playback

[rounin]

I was just reading X-bit labs today and came across and article on the cost of manufacturing a Blu-Ray or HD-DVD machine. What made me wonder was this :

DVD player and recorder units will have a combined market of 176.6 million units sold worldwide in 2010, up from 140.8 million units in 2005. The forecast for 2006 predicts that Europe will be the strongest region for DVD players and recorders with a combined total of 38.4 million units sold.

In other words, since Sony has shipped 100 million units of PS2, if we assume roughly 80% of the total shipped has been sold, doesn't this imply a huge part of the DVD market is taken up by Sony in either scenario of :

1. PS2 was counted as a DVD player in these counts
2. PS2 was NOT counted

? Perhaps some kind of prediction can be made on how much PS3 will affect Blu-Ray adoption based on this data.

 

[Carl B]

I think PS3, more than PS2 ever had, will have significant effect on Blu-ray adoption - more from the industry side than the consumer side even. But this is assuming that things are still simmering between HD-DVD and Blu-ray at that point. If HD-DVD gets a strong hold in the consumer conscious between now and November, well PS3's assistance to Blu-ray may be a little more muted.

 

[RancidLunchmeat]

It doesn't matter.

Even people with PS3s that have Blu-Ray won't use them because 1) They don't have HDTVs, 2) Can't tell the difference between DVDs and 3) Won't spend the extra money to purchase a BR disc over a DVD because of the first two reasons.

Of course, this could change if Sony learns a lesson from it's UMD failures and actually makes the BR less expensive than DVDs to spurn quick adoption.

But I doubt it.

 

[Mmmkay]

I was just reading X-bit labs today and came across and article on the cost of manufacturing a Blu-Ray or HD-DVD machine. What made me wonder was this :

Umm, I think that means 140m units were sold in 2005 and they expect the market to be still growing by 2010 where 176m units are expected to be sold. They're not cumultive sales figures.

After all if Europe is expected to sell 38.4m units in 2006 alone, how does that add up?

 

[Carl B]

Rancid you can't seriously equate Blu-ray to UMD can you?

 

[m1nd_x]

Rancid you can't seriously equate Blu-ray to UMD can you?

In the sense that they're both formats that you won't be able to use anywhere else(unless you buy a blu-ray player and all your friends have them as well as opposed to HD-DVD) and they both cost more than they should and you and everyone else would have to own an HDTV to see any benefit at all from them.

Of course that is comparing them to DVD which pretty much everyone I know has, it's so widespread that you can bring them anywhere and have a certainty that you can watch them wherever you are.

 

[RancidLunchmeat]

I was equating UMD to BR in terms of cost and people making the decision based upon cost to purchase a particular format over the currently excepted format (DVD).

If the majority of people can't recognize the difference between BR and DVD (probably because they don't have the hardware to take advantage of the capabilities of BR over DVD), then people aren't going to pay more for a BR to play it on their PS3 rather than pay less for a DVD and play it on their DVD player (or.. also on their PS3).

Upon purchase of a PS2, everybody had the hardware to take advantage of DVD and the difference in quality between VHS and DVD was obvious. This made people more willing to spend more to purchase DVDs over the VHS counterpart.

I don't see that being the case for quite a while in the PS3's lifespan, if it ever happens during it's lifespan.

 

[Titanio]

Even people with PS3s that have Blu-Ray won't use them because 1) They don't have HDTVs, 2) Can't tell the difference between DVDs and 3) Won't spend the extra money to purchase a BR disc over a DVD because of the first two reasons.

Well there's a bucketload of assumptions.

I'm a person who'll have a PS3. I have a HDTV. I'll buy Blu-ray movies. Looks like you were wrong!

Seriously though, I think nearly anyone who buys a PS3 that has a HDTV - which will be a lot of early PS3 owners, at least - will be candidates for Blu-ray purchases. You don't buy a HDTV for no reason - once you've done that, you'll have already made the investment in HD, and you'll prefer HD content from thereout. And a big part of that for most people is movies.

Even if you didn't have a HDTV, if you happened to have a Blu-ray player and Blu-ray titles were the same price as DVDs, IMO it'd be a no-brainer to get the Blu-ray version (they'll look better once you do upgrade, and you'll enjoy the other smaller benefits in the meantime).

 

[Carl B]

I think you guys are both commiting a falacy by viewing the debate in terms of 'DVD: equal to or not?' I grant you readily that Blu-ray will have lower levels of utility than DVD, but that's not the point. The point is, will PS3's inclusion of the feature provide for it no better a format boost than PSP's inclusion of UMD provided for UMD? And I say, that no - PS3's inclusion of Blu-ray is not akin to UMD.

Firstly, Blu-ray is an industry standard, not an exclusive one-off. If Sony can coalesce industry support behind Blu-ray, and PS3's install base can help make that happen, that's the only item on their agenda. It doesn't matter that you need:

a) a consumer base with HDTVs

or

b) Blu-ray prices lower than DVDs (why?)

...because these are criteria that exist anyway for *any* manufacturer of HD-DVD or Blu-ray players. And that's the group we're talking about.

So within that group, however small, if Sony can someone leverage itself and convince the industry to abandon HD-DVD in favor of Blu-ray - and yes due in part to the existant install base, because afterall you have to start somewhere... - then well, I mean what can I say? I think the PS3 helps Sony achieve it's goals.

Now again as in my first post, if HD-DVD has already gained decent traction by that point, I think the PS3 advantage is dulled. But to add on a final note, I think that the early adopter crowd for PS3 - at least in the US - will be exactly the type to own an HDTV already and spend some cash on Blu-ray movies.

 

[RancidLunchmeat]

Huh? Are you missing the premise of this thread?

? Perhaps some kind of prediction can be made on how much PS3 will affect Blu-Ray adoption based on this data.

The answer to the question is "No." for the reasons I stated above.

I simply don't understand what you are saying here. Are you under the impression that the only people who will purchase PS3 have HDTVs? If that's the case, Sony is in big trouble.

(I know that's not what you were saying.)

If you are saying that people who have HDTVs that purchase PS3s will most likely spend more to buy BR over DVDs, sure. But again, that number is a small fraction of the PS3 install base. As opposed to an install base of 100% for people who purchased PS2s.

 

[RancidLunchmeat]

So within that group, however small, if Sony can someone leverage itself and convince the industry to abandon HD-DVD in favor of Blu-ray - and yes due in part to the existant install base, because afterall you have to start somewhere... - then well, I mean what can I say? I think the PS3 helps Sony achieve it's goals.

However small is the key phrase.

I think you're talking about such a small minority that it will have no impact on the success or failure of BR or HD-DVD. There's far bigger and more important factors that will determine the winner of this format war than the impact of the install base for PS3s among HDTV owners.

You're talking about sub-groups of sub-groups of sub-groups here. I don't see how it will possibly end up being signifcant.

Anybody got any statistics on the percentage of HDTV owners that own gaming consoles? That might be a good place to start.

 

[Carl B]

I don't know if you're responding to me or Titanio Rancid - or both - but for myself I do think that the HDTV percentage of ownership among people with PS3 within the first three months of the system's launch will be fairly high.

My views on PS3's overarching effect on the industry are explained in my prior post though, and it's my belief that however small the ratio of HDTV owners were actually to be - let's say 5% (and I think it'll be *much* higher) - that's still a boost to the BDA to have gotten those players out there rather than to have not.

In the end, we have to view it from the eyes of the studios and industry as a whole, and to have a bunch of well-to-do young males in possession of a Blu-ray player right off the bat must mean something to them.

Sony doesn't even have to beat DVD with Blu-ray, they just have to hedge out HD-DVD.

EDIT: Ok I guess it was directed at Titanio! Anyway, I agree with your response to me - that would be a great stat to have. Isn't the HDTV penetration in the US supposed to skyrocket over the next year? But I mean really, I just think like 360, the very first adopters will be the people that have the full means to enjoy the 'experience.' 360 itself was credited with moving a large number of HDTV's afterall...

 

[archie4oz]

A couple of things...

Of course, this could change if Sony learns a lesson from it's UMD failures and actually makes the BR less expensive than DVDs to spurn quick adoption.

1.) Sony doesn't set the price of UMD videos (other than it's own releases), therefore there's very littel for "Sony to learn".

2.) Sony doesn't "own Blu-Ray" so it can't exert full control over Blu-Ray's prices.

Upon purchase of a PS2, everybody had the hardware to take advantage of DVD and the difference in quality between VHS and DVD was obvious. This made people more willing to spend more to purchase DVDs over the VHS counterpart.

This isn't fully true either. When DVD started becoming popular, many people didn't have the proper equipment (e.g. smaller TVs that are/were unable to resolve the picture at full resolution, or lacked the connectors to pass the full fidelity)...

 

[rabidrabbit]

Yes, the PS3 is timed to the "HD-era", and that HD era is being strongly marketed by TV and display manufacturers and content providers.
Will those who are happy enough to view their DVD's with their new HDTV's adopt the Blu-ray? Some will, not by masses at first, but I'm sure there will be a significant portion of HDTV owners who don't see a reason to dithc the perfectly good quality DVD discs.

But I'm positive there are also quite a few who don't mind a higher resolution format that fully shows what their expensive new HDTV is capable of.

I don't think Blu-ray and HD-DVD are even meant to replace the DVD as a standard for years, they can happily live together and there is a market for both of them.

Many say a big minus of the new standard is that youcan't loan your discs to friends who don't yet have a HD player. I say it's their loss, I'm never too keen on loaning my prescious discs anyway, but for the sake of friendship I've just had to.
if I have a valid excuse not to loan anymore then that's just good for me. Bad for them, but good for me
As for not being able to play the discs in other rooms but the dedicated HT room, well if that is a must feature to me, I'll buy HD players for those rooms, or if the PS3 will make possible to stream the content I'll live with it and it's limitations until I can afford to replace all my DVD players.
Anyway, being limited to viewing in one room isn't such a big loss as many like to represent it I think. For those it is, it might hurt a while, biut I don't think the disadvantages outeight the advantages in real life, at least if you indeed want high definition movies.

 

[Bobbler]

I don't think Blu-ray and HD-DVD are even meant to replace the DVD as a standard for years, they can happily live together and there is a market for both of them.

Much like DVD and VHS -- the goal is to get a foothold now and slowly replace DVD over the next 5-10 years. PS3 is just hoping to cement that foothold quicker, not necessarily start a full blown replace-everyone's-dvd-player fest (if that does happen, I don't think anyone would really be disappointed though =p).

At this point I just hope one of the two formats sinks in... having an HDTV and seeing stuff on OTA/cable TV that looks better than upscaled DVDs is really kind of annoying (especially when you watch as many movies as I do!).

 

[m1nd_x]

This isn't fully true either. When DVD started becoming popular, many people didn't have the proper equipment (e.g. smaller TVs that are/were unable to resolve the picture at full resolution, or lacked the connectors to pass the full fidelity)...

Anyone that could use a VCR, could use DVD... Which is pretty much every tv, I really don't know what you're talking about, there isn't a single instance I can think of where a person couldn't hook a DVD-player up to a TV.

Maybe you mean, if you only had RF jacks on the back of a TV, in which case you could just run it through a VCR or get a RF modulator ($10-20).

 

[RancidLunchmeat]

What in the world are you talking about?

A couple of things...

1.) Sony doesn't set the price of UMD videos (other than it's own releases), therefore there's very littel for "Sony to learn".

2.) Sony doesn't "own Blu-Ray" so it can't exert full control over Blu-Ray's prices.

As far as I'm aware Sony is the sole owner of the UMD format, and therefore does set the price of the discs through licensing fees. Same holds true to a lesser extent on BR.

Unless you are saying that BR and UMD are so expensive not because of licensing fees, but rather because of manufacturing costs that can't be reduced/controlled by Sony.

In which case, Sony still faces the same issue and should have learned the same lesson from creating formats which are prohibitively expensive (for whatever the reason).

This isn't fully true either. When DVD started becoming popular, many people didn't have the proper equipment (e.g. smaller TVs that are/were unable to resolve the picture at full resolution, or lacked the connectors to pass the full fidelity)...

Where do you live? (That's a serious question) because in NA, TVs that couldn't play DVDs when the PS2 was released were the minority.

That's the opposite of now, where in NA TVs that can't play (won't benefit from) BR when the PS3 is released will be the majority.

RR: Exactly. But that's the point. Any change over, if it happens at all, will happen very slowly. Like I said, BR might not even be a significant portion of the market throughout PS3's life time. Therefore, the impact of PS3 sales on BR adoption is most likely going to be very little.

 

[randycat99]

Where do you live? (That's a serious question) because in NA, TVs that couldn't play DVDs...

...to the fullest extent of the DVD That is the criteria you are applying to the BR scenario, but strangely seem to spare in the DVD scenario. No one is arguing if you could connect a DVD player to a TV in some manner, in that time period. Could the majority do it in component or dvi connection? Did the majority of CRT's have the razor sharp resolution to show off full DVD potential? Did the majority of TV's have progressive capability? That is the logical extension of the criteria you are weighing. The answer to that is very much the same for the BR scenario. A great deal of display devices are not capable of receiving the full potential of their respective disc format era. Does that mean the capabilities of the format are a waste? Should a prospective format only target the performance available on that day of its release? Of course not! It needs to exceed current performance to have "legs" for the future. It will connect to almost any existing device, of course. So the output may not be ideal, but it is certainly viewable output. Anyway you cut it, 20+ Mb/s compressed vbr video will give superior results to 5 Mb/s compressed vbr video. The benefits only become more pronounced as with larger screens and even moderate screens with greater detail performance. Even if the bottleneck is somewhere else, there is nothing to stop the expectation effect on the consumer from "creating an subjective improvement", anyway (such is already the case with the popularity of satellite HD services, already).

Anyway you cut it, the coming hi-def formats are a "win" for the consumer nearly regardless of the equipment they currently own or will own.

 

[scooby_dooby]

Therefore, the impact of PS3 sales on BR adoption is most likely going to be very little.

You're kinda missing the point though, DVD wasn;t involved in a format war and BluRay is. So any additional momentum they can gain, which PS3 will surely provide, could possibly help them win this war and eventually be one of the single biggest factors that led to the mass adoption 5-10 years down the road.

Basically PS3 could make it or break it for BR as an industry standard, so in the long run it will affect BR adoption in that sense. If 10million homes have a BR player installed, that surely drives the adoption of BR as a standard. It will also affect BR adoption because it offers a cheaper alternative than the first wave of standalone players.

Obviously BR won't influence PS3 adoption nearly as much as DVD did for PS2, but that's a different discussion.

 

[Paul_G]

...to the fullest extent of the DVD That is the criteria you are applying to the BR scenario, but strangely seem to spare in the DVD scenario. No one is arguing if you could connect a DVD player to a TV in some manner, in that time period. Could the majority do it in component or dvi connection? Did the majority of CRT's have the razor sharp resolution to show off full DVD potential? Did the majority of TV's have progressive capability? That is the logical extension of the criteria you are weighing.

I don't think you're getting his point, my interpretation of his comments are that when DVD arrived, almost everyone had a TV capable of standard def. VHS is sub SDTV, and so all those people at the very least saw some improvement in picture quality. Those same people with those same SDTV sets are now running DVD at the limit of that display's resolution, so now playing BR or HD-DVD shows no improvement, limiting adoption. Like you say, these people aren't getting the best from DVD, but they are at least getting something vs VHS. The same cannot be said for these High Def. formats vs DVD.

Rancid's criteria is not which sets won't get the most out of DVD or BR, but which sets will see any improvement at all to the consumer over the previous format, and unless you have an HDTV, BR offers nothing visually to make you want to buy it.