Industry Insiders Master Q&A thread III: ONLY Questions to Insiders - Page 117  

They caught me jetlagged in Japan and are taking advantage of me .

Seriously, let's go a few more posts and then stop if nothing constructive comes out of it.

I don't think so. There is super high risk to them in such a strategy.



No I don't. If they want to go to EU or any other regulatory organization, no one would be happier than I given where the facts sit.


As I said it is really simple. Make the other guys look bad and as a result, attempt to diminish the importance of Paramount trying BD format, and rejecting it now as a viable strategy for them. They had no other news to counter this so they cooked up something on an assumption which is proving wrong. Now they have to figure out how to backtrack....

Nope. "Exclusive's" are part of the business world. Most of the time it is done around "promotional dollars". For example:

Company A agrees to provide Retailer B with said product. Retailer B must give exclusivity to this product for a term of 180 days, in exchange Company A will provide $xxx in promotional money to offset advertising and promotional costs.

Is this what happened with Target, for example?

Its odd that the demands of Netflix's customers (the largest online dvd rental service) shows an equal amount of demand for both formats when Blockbuster publicly states there members only demand Blu-ray.

With this in mind I have a few related questions that I would like to hear what insiders from both sides think about the subject.

01) What is you opinion(s) on why the countries 2 largest DVD rental retailers are reporting differing consumer demand?

02) Netflix reports an equal amount of software demand for both formats. Are any companies or studios viewing this as a problem that HD DVD has equal or near equal demand compared to BR with so much more players already on the market?

03) Are any BR or HD exclusive studios under commitment to not release titles for there competing format?

Since this netflix info is coming after BB reports, can't common sense tell us that all HD DVD renters are renting from netflix where has a BD renters are renting from both BB and NF. Therefore rentels would be lower for both?

Wow. I would have expected that the contracts are written more cleverly than that and not mention "exclusivity" at all. Something like we will provide you with so many Product As and it's such a large amount that it consumes all the shelf space allotted to that type of product. If the word exclusive is actually in the promotional contract, why isn't that considered a fair trade violation?

You can read more from Reed himself here: http://reedhastings.blogspot.com/

Fair notice: Reed is on the board of Microsoft. But sadly, I have yet to meet him and brainwash him about all things HD DVD .


I don't have exact reasons of course. But it could be merchandizing. Netflix can afford to promote both formats equally and provide inventory for both the same. Harder to do in typical store.

Also, demographics might be different. But I am just guessing here. I think it is important to look at what both are saying that is the same. That is, neither wants or thinks is able to predict the outcome of the war. And that the overall volume is tiny.


In general, studios don't like rental outfits. So if you are asking their opinion, then I don't think they care one way or other what these guys are doing.

Give it a rest.

To the Microsoft guys,

What were the general goals for HDi, specific to the end user experience?

Were other Microsoft groups involved? Such as Media Center folks, since HDi would presumably be a 10 foot gui. Or Internet Explorer devs, since the content of HDi is/could be dynamic. WMP devs, for active content? etc.

How about non-skippable items, such as FBI/Interpol warning or advertisments? Mandatory content? Restricted content (i.e. something HDi specifically will not ever do)

...oh, yeah, and above (again reading behind the lines) you talk about combo player manufacturers that are developing their own HDi. Now, as far as I know, the only CE for combo players are LG and Samsung. LG hasn't done HDi yet with the current player, but the next one is supposed to be fully HD DVD/BD spec as far as I know. Did they develop their own HDi implementation? How about Samsung? If not, who -is- doing their own thing, and why, who is using MS's solution, and why, and can you drop a hint about who else maybe doing combos (brand names, or cheap-o Chinese units?)

yeah, basically I'm looking for some bean spilling...

My example is very rudimentary and wasn't anything that I would use in my line of work, but was for example purpose only.

My day job is a Business Develpment Manager for a large manufacturer (outside the electronics business) and we make these type of promotional agreements with select retailers on occasion. Each agreement must be signed off by our legal department (which is very conservative in their approvals), and thus far, everyone that I have been privy to has passed muster.

It wouldn't surprise me if Toshiba approached Target and tried to buy an end-cap as well, but Target couldn't do it due to financial considerations from Sony. In fact, I believe that getting Circuit City to stock Toshiba HD DVD players was paid for by the HD DVD Promotional Group, which again, is good business on their part to get another retailer offering their product.

I am glad you said "spec" and not product. Because last I heard, a Sony executive declared them finally as non-manufacturable late last year. This, after two years of hyping them by BDA.

Basic problem is that once you put a DVD layer underneath BD, it throws your tolerances in you know what .

Which is irrelevant, since none of the services provided by the extra chips are required in a BD 1.1 player. I'm not comparing them at all, I'm just saying that SOC designs supporting the features required in BD 1.1 have been available for some time now. But anyway, you're welcome to believe what you want.
The 7440 has two flavors, the 7440A, which is a single core design, and the 7440B, which is the final design, with two cores. Our code was running the entire player on a single core SOC, running Windows CE. It means that our performance is adequate for most of the SOC designs coming out (The 7440B I believe is a 400MHz chip), which is the only real test of suitability.

I was not directly involved in the CES player code, since I was on vacation at the time, but I can assure you it was all running on a single core.

I asked that the discussion about the Paramount deal be kept to the Paramount threads. Now I'm going to have to demand it.

Sorry, but it's cluttering up the thread and it's starting to sound like a bunch of reporters at a press conference trying to catch someone in a lie.

There are a lot of members who would like to ask honest questions of our insiders without sounding like a Matt Drudge wannabe.

Doc

That's very interesting.

Given that HD DVD layers are at the same position as regular DVD layers, does that mean it's possible to create single sided BD/HD DVD hybrid discs as well?

Amir,

Most of the recent cost and yield comparisons have been comparing HD30 to BD50.

Since the majority of new HD-DVD releases seem to be on HD30/DVD9 combo discs, can you give us the number of replicators that are producing these HD30/DVD9 discs, the costs and yields?

After all, there have been many arguments that 300 did not sell as well on HD DVD, despite the advantage in interactivity, due to the $5 cost differential.

If these discs were more cost efficient with better yields wouldn't it have been prudent to cost them the same? If not, does that indicate that there are consumers that feel that combo discs and interactivity are not worth $5?

Mike

As they should be. Apples and Apples. Dual layer versus dual layer.


Don't have either to offer. But can say that relative to BD50, hybrids are way easier to make. After all, DVD-18 has been in production for a long time. But folks could not even manufacture one BD-50 disc when the format was launched last year.

Mind you, they are more expensive than HD DVD-30 because of the additional steps. But nowhere near BD-50 because there is no new science. And of course, those lines can make normal DVDs which you cannot do with BD.


I checked earlier on Amazon and 300 rank for BD is #7 whereas it is #2 for HD DVD. Quite an accomplishment given the fact that as you say, the HD DVD is retailing for $27.95 verus $24.95 for BD version. So it seems at least on Amazon, the HD DVD is selling much better, despite higher retail price.


No, both of your conclusions are incorrect. First, the studios are pricing these titles "to market." Every time I complain to an HD DVD studio about high retail price of combos, they tell me about Fox pricing for BD titles. Besides, you don't know that the studios are paying market price for BD-50. I believe Talk confirmed that subsidy is involved. If so, then all bets are off until those contracts run out.

Second, 300 arguably had a better fit to PS3 demographics than typical HD DVD owner which is more of a movie buff.

But per above, to sell as well as it has despite higher retail price, and better than BD version on Amazon if my read of the stats are right, shows the remarkable power of HD DVD brand and desirability of the extras in the HD DVD version.

There, you spin things your way, and I show you how it is done in reverse.

Amir,

Any comment on this press release for a Venturer HD-DVD player made by Alco?

http://www.alcoelectronics.com/news-details.aspx?id=15

Will it/does it use the Microsoft/Broadcom created hardware/software platform>?

I bow to the master!

A question to any Intel/Broadcom insiders: Any word yet on the PCIe or PCI card that offloads VC1/h264 decoding on the PC?

Belated, but welcome, Dave. It's nice to have another member of the press around.

Chase

Haven't DVD-18 mostly been abandoned due to various issues?


Or, it could just be the 3 free HD DVD/BD deal that Amazon is running. For the last couple of weeks (I think) 300 has been selling better on BD than HD DVD, but, admittedly, not by much.

Thanks Chase.

Could you give any quantification or personal guestimate, perhaps? Do you think it's just 1 replicator or 5 or perhaps 10 or even more who are doing combos? Can just any HDDVD line do combos or do they need special equipment for gluing them together or some such? How about Twin Disc?


Yet we know there have been at least a hundred thousand more discs sold on by the Blu-ray version, and that of movies released in both formats that the Blu-ray's show a bigger "tail" in it's sales spread after release, would seem to indicate that Amazon's sales rankings are relative and not really a useful barometric, no?

The MSRP difference at Amazon, however, is far less than we've seen at B&Ms... (the HDDVD of 300, for example, being some $10 more than the Blu-ray at Target). Do the studio guys you're talking to realize how much bigger the disparity is for most people who don't shop at Amazon?

IMO, the marketing department is getting involved in the Combo releases in that their internal research shows that consumers will spend $5 more for the added value of having the DVD version on the disc. Which I personally don't think is the case. $1 more, maybe???

Then again, PS3 sales projections with a pricepoint of $499 and $599 we said to be 6 million in the US and they are around 1.5 million. Projections have a way of being wrong!

Unfortunately this is a wrong observation. Usually the BD sells better. Right now the HD DVD is selling better because (probably) there is a special buy 2 get one for free deal. The people are using this special deal to (finally) get the heavily overpriced combo HD DVDs. The more you buy the more you save. Combo street prices are evil. Evil. And I say this as a pretty vicious HD DVD supporter. Oh god, oh god, I hope I do not get banned for saying this...

I was not in the loop on every discussion, but SPHE marketing may have decided to hold back this feature on some titles.

Much of the noise in this thread comes from members making assumptions about things they don't have much factual information about. I don't know to what extent Microsoft was involved in the Paramount announcement and I don't know if SPHE or other BD companies gave incentives to BB.

Thank you!
-t