Originally Posted by rlsmith
My guess is that the royalties will be somewhat similar for Blu-ray, HD DVD, and DVD at the end of the day.
DVD was such a success because of the low pricing and encouragement to sell-through at low prices. High royalties can hinder such pricing and such growth.
Sony would clearly like to see the day where all new players are Blu-ray and a growing overall percentage of disks would be Blu-ray. Over time, this would divert the royalty stream currently going to the DVD Forum (of which Sony gets some BTW) to going to the BDA (of which Sony gets more). Toshiba clearly does not want to change the balance.
It is precisely this dispute that has given us the format war.
so that means that if royalties are in fact around $.25 / disc title...and some percentage of PS3 players were bought with the sole intention of getting a cheap Bd movie player...how many Bd movies have to sell before Sony can recoup the $300 spent subsidizing the player?
for the # of consoles bought strictly for movie playback; Is 10% of all PS3 sales a figure people here can accept?
Between 100,000-200,000? or is that too high?
Let's be conservative and low ball it. Say 75,000 units are going to be used soely for movie playback.
75,000 x $300 = $22,500,000.
at $.25 per title that means they only have to produce, move, sell 90 million discs before those players are fully subsidized.
I realize it doesn't quite work this way and that PS3 game royalties are far more...but those royalties also have to go towards those other 2+ million consoles out there (a $600 million deficet and growing every day)- and in case people haven't been following the news, that console is currently a distant #3 out of the 3 next gen consoles.
Of course, none of those figures include how much is being spent on replication facilities.- or being thrown away on poor yields and low cycle times.
which is why it amuses me to see so many people thinking that Blu-ray selling 10,000 copies of a given title compared to HD DVDs 5,000 is a sign that the end is imminent for the other format.
From where I sit, Blu-ray is in one huge pickle for multiple reasons, and I wouldn't be at all surprised to see it implode out of the blue one day.