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Discussion Starter · #1 ·
Since CES - a lot of smart Joes and objective, neutral people (like Warner, for one) now seem to be predicting that the real future for the next-gen of optical media is that both competing formats will compeletly coexistence.


That neither side will win completely but rather that - after another two years or so of both formats jerking each other off under the radar - enough units will be sold and enough advantages will have become equal...that really neither side will seem able to win completely.


But I don't get it. How will this "coexistence" work exactly?


Because everything will be like a Warner Total HD disc?

Because everyone will instead buy a dual-format player?

Because BD hardware prices will come down and HD DVD studio support will go up - thus then suddenly convincing everyone to buy two players?


I mean, what? - I thought all these above, "unusual" solutions and the fact that there wasn't a single, clear successor to SD DVD but rather just a bunch of confusion/stop-gap stuff - were some of the very largest reasons that were preventing Joe Six Pack from being interested in this stuff at all.


And then...if both two formats do truly start to coexistence with more equal studio support, hardware pricing, and install bases - then what happens? Won't one format still ultimately pull ahead for one reason or another? Will then, BD only really eventually get the PC storage/PS3 game market while HD DVD gets the majority movie market?


But that seems like the very thing that Sony and Fox would consider to be a serious loss for the BD format...so I don't know here...


What's the deal? Somebody explain all this "coexistence" jazz to me...

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Will then, BD only really eventually get the PC storage/PS3 game market while HD DVD gets the majority movie market?

Ultimately i believe that is where BD will go, though i have my doubts how long it will last as a PC storage medium.

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But that seems like the very thing that Sony and Fox would consider to be a serious loss for the BD format

Not agreed. Sony gets what they want - cheap manufacturing of BD Rom discs for their PS3. Fox doesn't give a hoot as they simply release their titles on HD DVD and make a lot of money as the install base is now higher.
 

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Discussion Starter · #3 ·

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Originally Posted by gooki /forum/post/0


Ultimately i believe that is where BD will go, though i have my doubts how long it will last as a PC storage medium.


Not agreed. Sony gets what they want - cheap manufacturing of BD Rom discs for their PS3. Fox doesn't give a hoot as they simply release their titles on HD DVD and make a lot of money as the install base is now higher.

So at the point of coexistence - BD-50 discs are much cheaper to manufacture - but still all the movie studios stick with HD DVD for a majority of their releases?


OK, then - not that I disagree necessarily - but then let's be clear as to why we're suggesting this...because BD will never be able to have as many replication houses as HD DVD (since DVD lines are easily converted)? Because HD DVDs production costs will still be very significantly cheaper than BDs? Because Sony will never give up their stingy production practices or desire for a "cut" enough to allow for mass, mainstream high-def movie disc production? Because it will always be cheaper/easier for the now BD-exclusive studios to start producing for HD DVD rather than the other way around? Or what?
 

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Well... it might turn out like...


DVD-R / DVD+R : Both formats are still around. Most people don't care which one they buy because almost all players & recorders read & write to both.


SACD / DVD-A : Both formats are still around. Most people don't care because they don't they don't buy them. Standard CD is holding the market and it doesn't appear either of these formats will ever become popular in the mainstream. In addition, many players can play both formats.


Video Game Systems: Some titles published for both formats, some are exclusive. Customers either buy players for both formats, or are content with one.


I'm guessing... and actually hoping that they both stay around and that it will eventually be more analogous to the DVD-R / DVD+R market. Warner's TotalHD is something new. I don't think there has ever been "dual-format" software like that before. I guess everything could potentially be TotalHD in 5 years. That sounds awfully silly to me though - the most useless & redundant outcome possible.
 

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Discussion Starter · #5 ·

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Originally Posted by obispo21 /forum/post/0


I'm guessing... and actually hoping that they both stay around and that it will eventually be more analogous to the DVD-R / DVD+R market.

Yes, I think this is what most more-objective, more-neutral people are hoping for - but still it seems like this situation will be infinitely more complex and/or difficult to allow for that to occur. I mean, - exclusive movie studios with exclusive content on each side, people just being more finicky and concerned about how their favorite movies are purchased/owned in general (rather than a vague blank disc brand), huge corporations with deep agendas and pockets on both sides, etc. Like I suggested in my original post - I don't know how easy or even possible at all it would be for some perfect DVD-R/+R situation to be the result of all this.


And even with that said, I don't know about you - but I actually STILL only purchase and prefer to buy DVD+Rs!!! Even when I don't need too and don't even care about blank media formats half as much as how I get my favorite movies!


See one time I had a bad experience with a DVD-R that rubbed me wrong, and more-over DVD+Rs have always just seem more stable and compatible to me - whether that is true or not.


So with thing like movies and all this other junk involved - I don't know how the perceptions aren't gonna get much more wierder, more muddled - and affecting of purchases.


I guess this is the kind of thing - where people say an "X" factor will actually win the war and no specific thing that people could have imagined to predict...


Some strange, probably-neutral or relatively unimportant thing will effect the majority's opinion of one side - and that will be what ultimately ends it. Just a matter of skewed perception for no clear reason...

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Quote:
Originally Posted by obispo21 /forum/post/0


Well... it might turn out like...


DVD-R / DVD+R : Both formats are still around. Most people don't care which one they buy because almost all players & recorders read & write to both.


SACD / DVD-A : Both formats are still around. Most people don't care because they don't they don't buy them. Standard CD is holding the market and it doesn't appear either of these formats will ever become popular in the mainstream. In addition, many players can play both formats.


Video Game Systems: Some titles published for both formats, some are exclusive. Customers either buy players for both formats, or are content with one.


I'm guessing... and actually hoping that they both stay around and that it will eventually be more analogous to the DVD-R / DVD+R market. Warner's TotalHD is something new. I don't think there has ever been "dual-format" software like that before. I guess everything will be TotalHD in 5 years. That sounds awfully silly to me though - the most useless & redundant outcome possible.

That's the thing. Both of these formats CANNOT CO-EXIST. Because when it does, it's a stalemate from a profit point of view and does not advance into full mainstream.


DVD+/- is a completely different situation. It targets a much smaller community within the mainstream movie buyers. How many 60+ year olds buy blank DVDs? Contrast that to the increasing number of 60+ year olds who buy DVDs.


One will win over the other. If the studios see that tides are even, they'll decide for us - whether it means for Blu-ray or HD DVD.
 

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Quote:
Originally Posted by Amiable-Akuma /forum/post/0


Yes, I think this is what most more-objective, more-neutral people are hoping for - but still it seems like this situation will be infinitely more complex and/or difficult to allow for that to occur.
Quote:
Originally Posted by eightninesuited /forum/post/0


One will win over the other. If the studios see that tides are even, they'll decide for us - whether it means for Blu-ray or HD DVD.

Yeah - Both of you might be correct. I'm not sure what will happen... just offering some possibilities.


You make good points that what separates this from DVD+/-R is the fact that actual content is sold on these discs. That said, I wouldn't be willing to rule out format co-existence necessarily.


Even if dual-format players don't become the norm... people are willing to accept multiple video game systems with exclusive content on each *maybe* it could work for movies too. (Then again, video games do have a smaller, younger & more tech-savvy audience who are probably more likely to accept multiple formats.)


In the meantime though, I guess I can only pray to the mighty HD on disc gods that everyone decides to follow LG's lead w/ dual-format players to put an end to this ridiculousness.
 

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Discussion Starter · #8 ·

Quote:
Originally Posted by eightninesuited /forum/post/0


One will win over the other. If the studios see that tides are even, they'll decide for us - whether it means for Blu-ray or HD DVD.

Hah, hmm, this reminds me - maybe this is the truth/reason behind the HD DVD camp always saying in interviews: "Our goal [for now] is just to survive. [In the face of all the current, massive CE/studio support for BD, -]. We don't need to 'be winning' from the start to succeed...because if we just survive - then we will ultimately win."
 

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ince CES - a lot of smart Joes and objective, neutral people (like Warner, for one) now seem to be predicting that the real future for the next-gen of optical media is that both competing formats will compeletly coexistence.

just to point out, Warner with the THD will make more money (Royalties in the THD processs) if there is a stale mate and THD is used
 

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I'm not sure what cost of replication has to do with my argument. All i meant is, BD has the potential to fail as a movie format because the main backers do not need to see it succede.


If you're life doesn't depend on it you tend to fight a little less hard.
 

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In a long drawn battle the group with better economics will win. Producers will want high volume and high margin (supply side). Consumers (demand side) will be driven by price and content. The missing link for HD DVD is content (demand side) and for BD the problem appears to be hardware prices (demand side) of stand alone players and the PS3 (supply side, impacts margin for other producers) subsidy.


The other factor is what impact does Sony's current price ceiling on replication costs have on other suppliers?


So overall, the margins for BD appear to be lower overall. IMO, with Sony eating most of the costs for now. So coexistance will probably favor HD DVD, especially if DVD plants need to be converted over at some point.


In a long drawn battle one would have to assume that prices will reflect true market costs....
 

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Lots of interesting questions.

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One will win over the other. If the studios see that tides are even, they'll decide for us - whether it means for Blu-ray or HD DVD.

One would have to wonder which way they will go at that point, or rather, what will play into the decision making process. Obviously cost will be the most important factor. Now we don't really know (most of us) just how much money that Sony and partners might be paying out to subsidize BD disc production, but by all accounts it's more (maybe significantly so) than HD DVD production costs.


Those BD production costs can come down in time, but is Sony willing to just write-off the costs it has absorbed getting everyone started? Sony has to be bleeding a ton of capital to get BD off and running, and their strategy to recoup their costs (one would assume) has always depended upon total market dominance.


If HD DVD is right there as an equal to BD, then Sony does not recoup the amount of royalties they had expected. They can't have BD replication costs any higher than HD DVD or else everyone bails, but they can't get their money back the way they had planned either. Maybe they make enough back in royalties to offset their subsidies? I don't know, but Sony can not make out as well as they had planned in a stalemate situation.


They also need to calculate all of the money they have lost by derailing the Playstation brand with Blu Ray. I don't think they will ever get that money back.

Quote:
All i meant is, BD has the potential to fail as a movie format because the main backers do not need to see it succede

They do need it to succeed; they (Sony) practically bet the whole company on it.

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In a long drawn battle the group with better economics will win. Producers will want high volume and high margin (supply side). Demand side will be low prices and content. The missing link for HF DVD is content and for BD it looks like the key will be price competitive without subsidized hardware and software.

I agree. Sony has not played this smart on many levels. Had they just left the PS3 out of the equation and subsidized cheaper players and media, I think that BD would have fared much better and would not have needed the PS3 to entrench itself at least equally to HD DVD. The added bonus would have been the PS3 likely sitting in front of the Xbox360 today in the world market because it would have launched earlier, (possibly along side the 360) it would have been available in higher quantities, and it would have been priced much lower.


I think Sony should have struck a deal with the DVD forum and let the Playstation alone. But it is fairly obvious that they took this format war personally, and their choice to use the Playstation as a weapon has backfired on them.


Strictly from a cost perspective, HD DVD had BD beat from the start, and IMO ultimately wins in a stalemate situation, no question. The costs Sony has absorbed and will absorb in the future are just too great to declare them a winner in that case.


I however think BD is headed for a Royal Thrashing if and when $200 HD DVD players hit the streets.
 

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The solution is as simple as shaking hands and an agreement over how to split up the cash. Until that point, you are going to continue to see creative ways for each company to keep their hands in the cookie jar for as long as possible. Companies do what is in their own best interest! Intellectual property rights in todays business world are more important than ever, and this war is proof at just how hard companies will fight to protect it.


That said, the formats will unite when it is in their best interest to do so. Warner was very creative in serving their own interests and reducing costs for themselves.(more expensive single media, but less expensive than dual media). Ultimately, with the content advantage at what it is leaning towards Blu-ray and the trend for this to increase, it is only a matter of time before Blu-ray wins by volume. This doesn't even have much to do with which format is technically superior or which format is more cost effective. Volume and adoption will always win.
 

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from the neutral thread, with expanded comments below (long)

Quote:
Originally Posted by Kosty /forum/post/0


Although, I am an avowed Blu-ray skeptic and HD DVD supporter, I didn't start out that way. I am now absolutely convinced that both formats will survive for years, and I want both formats to be as good as they can be.


I consider it a gift that we can now see movies in high definition movies in our homes in a manner closer to the film maker's intent than ever before. Watching an old classic or a modern special effects film projected on my 110 inch screen is a wonder for me. I am a film lover and home theater enthusiast. I want others to share in my joy.


The whole concept of a format war slowing adoption of this HD goodness makes me grumpy at times. But since it's here, I'm trying to make the best of it.



I own a HD XA1 and am upgrading to a HD XA2 because of wanting the excellent Reon Silicon Optix HQV upconversion of my existing DVD collection of over 300 titles. I would own a Blu-ray player now if they were cheaper, and am still considering buying a 60GB PS3 or a newer Samsung. Upconversion, no matter how good is to me a compromise. I would rather have a dedicated Blu-ray player and I am waiting for Blu-ray prices to drop. I want to see those exclusive Blu-ray studio titles in true HD.


But I see both formats surviving and coexisting for years.


For HD DVD, its initial sales, performance, first to market advantage, proven suitability of DL 30 discs using VC-1 to display HD content and Microsoft Xbox 360 HD DVD player add-on have done enough to insure its survival for years. The longer it survives, the harder it will be for it to go away


For Blu-ray, Sony's bet the company play on Blu-ray in the PS3 as well as Fox's studio support alone are probably enough to insure that Blu-ray will also exist for years in one form or another.


Neither format will die soon. So consumers will have this state of affairs for years. And content will continue to be split across the two formats. We can't change this at all, its going to be a reality for years.


At CES, I finally saw Blu-ray's picture and audio quality start to show its potential. It seems clear to me that both formats are capable of equally impressive stunning picture and audio quality. Both will have eventually have the great HDi and BD-Live features that will enhance the movie watching experience. IMHO both formats have a lot of room to grow.


I also saw the enthusiasm for a flawed LG dual format player among the press and attendees. It wan't so much the player, or the price tag or its performance. It was the concept. It was the emotion of taking the fear and uncertainty out of the HD format decision. It was the simple idea of a elimination of the FUD inherent in making a wrong decision.


I want Blu-ray to keep on improving its titles and to start using advanced content as soon as possible. I want HD DVD to keep its consistent quality and reduce prices on the flipper DVD HD DVD combo discs so that more consumers will start buying them.


I want combo player prices and combo HD DVD and Blu-ray discs to become cheaper and more available.


I want HD DVD and Blu-ray player prices and discs to get cheaper and cheaper so that replicators and consumers will switch away from DVD's and move into the 21st century.


I continue to support HD DVD as I think it is further along this lower priced path, I want to support Blu-ray when it prices fall to similar levels.


Right now, my upconversion of Blu-ray exclusive content is a compromise. I want a dual format player, dual format discs or a cheaper Blu-ray player I can stack on top my HD DVD one. .


I just want just more high definition movie goodness spread into the world as fast as possible.

At his point I think we are going to a gaming console model of coexistence rather than a VHS/Beta one format dies or a SACD/DCD-A model where both formats bite the dust.


As a minimum, both formats survive throughout the current lifecycle of the Xbox 360 and PS3. In those cases, the number of people buying the add on or getting a future Xbox 360 with a HD DVD would tend to equal the number of PS3 owners with a HDTV using and paying for Blu-ray discs.


If I had to guess, I think the economics of HD DVD make lower priced players more economical and HD DVD will become the primary next generation format with two years. Blu-ray just can't bring lower priced players into the market faster than the HD DVD camp can.


If the HD DVD - DVD combo discs become (Paramount??) a studios norm, those sales will encourage J6P to try HD DVD. Total HD discs and lower cost dual format players will encourage people to try out the next generation formats and HD DVD will be the first choice of many because the players are cheaper.


Toshiba HD DVD players will probably be MSRP at $399 or less by summer, street priced at $349. Chinese players will be below $299 by the end of the year , with $199 prices sometime in 2008. Xbox 360 sales will continue to expand and Vista will make it easier to slap a Xbox 360, a Vista media server and HD DVD player together in a home network.


Once player market share and movies sales start moving to HD DVD most studios will go neutral with Sony and maybe Fox holding out for years.


There just won't be enough Blu-ray DL50 production capability for years and most releases will be on SL25 discs. When HD DVD sales increase , a lot of DVD replication lines will convert to HD DVD production and moer releases from secondary content provider sources and more catalog releases will come out of the studios. Studios will find this is a great way to get profit on dormant catalog titles.


I think that all studios except Sony and Fox will go neutral with dual releases or Total HD hybrid discs by the beginning of 2008. If those are the only holdouts, and the PS3 does not greatly increase its sales vs the Xbox 360 it will be tough to have Blu-ray in a dominant position.


I don't see the attach rates on the PS3 to be high enough to change this situation.


I said last year, that the first format to $199 players and $19.99 discs will win. I think that now will probably be HD DVD and that win will be with an eventual 70% market share in movie sales compared to a 30% share or so for Blu-ray.


Total HD disc will make the distinction fuzzy , but the volume of HD DVD player sales will nake the situation obvious.


At any rate, thats my thought now.
 

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I know manufacturing cost per disk would not figure in the total number because the costs are already low and going lower.


For studios, the HD30 is more expensive by pennies to produce than the B25, and the BD50 which should be more expensive, is so far subsidized to be the same.


Longer term, these manufacturing runs reach economies of scale, and there is no reason I can think of why a BD50 would cost more than a DVD9 to make. Ok, maybe a penny more.



Today, even with the miniscule volumes, the prices charged are $1.49(BD25) and $1.55(HD30) for all these disks in places like http://www.proactionmedia.com (That includes all the color printing for the graphics side of the disk).


My bet is the price declines to below $1 as soon as we hit 10x volumes (which is not difficult based on today's unit sales) and below 50c at 100x.
 

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Quote:
Today, even with the miniscule volumes, the prices charged are $1.49(BD25) and $1.55(HD30) for all these disks in places like http://www.proactionmedia.com (That includes all the color printing for the graphics side of the disk).

that doesn't include the authoring/ mastering charge for Blu-ray which is far more expensive than for HD DVD.
 

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Quote:
Originally Posted by eightninesuited /forum/post/0



DVD+/- is a completely different situation. It targets a much smaller community within the mainstream movie buyers. How many 60+ year olds buy blank DVDs? Contrast that to the increasing number of 60+ year olds who buy DVDs.

How many 60 year olds have eyesight good enough to resolve the differences between HD and well mastered SD at greater than 30 degree viewing angle, which is probably where most of them are sitting watchig their dvds?

For that matter, how many 60 year olds would pay a >$10 premium for the same content in HD over SD?

Hell, even the prime demographics for these things are prone to go thru lifestyle changes that affect their disposable income allocations (marriage, children, etc).

HD is nice, but when you can get 'almost as good' for 40-60% less, why wouldn't you? (well, that was rhetorical- we know why we wouldn't)


thing is- HD, as a feature by itself, is just not essential for the majority of consumers.

It is a feature that gets the enthusiasts motor running- and co-existence probably implies that if you are enough of an enthusiast to value higher resolution as a feature in and of itself, then you are probably enough of an enthusiast to buy into more than one format at some point.


so you have some perentage motivated by price points (HD DVD owners)

some motivated by content selection (Bd)

and some willing to indulge in both.


the way I figure, Both are going to be around for a while because while one side may have overwhelming sales #s, it will likely always be more costly to produce which drags down the net revenue. The other format may have to feed off of a smaller base, but its production costs will also be a fraction of the competitions which means it's net per unit will be higher. Neither will ever completely trounce the other- hence co-existence.


just my guess.
 

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Quote:
Originally Posted by Neo1965 /forum/post/0


.


Longer term, these manufacturing runs reach economies of scale, and there is no reason I can think of why a BD50 would cost more than a DVD9 to make.

How do you get economies of scale with a product that serves a niche need?

When do you anticipate these kicking in?


arePS3 games going to be using BD25s or BD50s mostly?
 

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My personal view on the issue is that this format war should have never gone this far. And I believe that the egos (of the people leading both sides), besides politics and the economics, contributed to the situation where we are now. 20 years from now, people will certainly look back at this format war to assert that, sometimes business can be very stupid and it lacks the simplest form of common sense.


Thus said, I believe that homevideo must truly be universal, and that ultimately, there can be only one format. Unlike videogames or CD media, where the format -- and its economics -- decide the niche of customers, movies have a worldwide appeal just like music. The flower girl in Hong Kong, the kid living in a Buenos Aires barrio or the urbanites from NYC or London, will only care for ONE format. Both sides know very well that they can't achieve a tremendous economy of scale if they go separate ways. And they only risk that one day, a third format might show up and further complicate and divide the market.


As we are where we stand now, content will decide the outcome of the war. And I believe that Blu-ray is poised to win. No matter how marketing can spin things, the fundamental rule is that recent blockbusters (12 months or less) account for 70-80% of the market. And Disney, Fox and Sony are the Studios with the most lucrative box-office results in 2006 or even over the last weeks. IMHO Universal won't have the "bankability" to sustain its position for long.


Hardware plays a role, but I don't think it'll be a factor in the long term. Clearly the aggressive pricing from Toshiba and Microsoft was a good approach to sell the HD-DVD format, like the PS3 is a trojan to sell a good quality Blu-ray player at an affordable price. But I think that the arrival of the mega blockbusters will ultimately dictate the pricing of hardware. I wouldn't be surprised if BD manufacturers introduced mid-price machines in May or June.


Microsoft is certainly a reason why the war lasted so long. If they hadn't helped Toshiba financially, we could argue that the situation could be different today. I think that they were smart, because the format war allowed them to establish VC-1 and to gain a lot of expertise in the HD technologies, professional encoders, compression schemes and even transport methods for XBL or other VOD-related marketplaces. It also buys them a good reputation in the long run.


In the event HD-DVD were to die, Microsoft would regret the loss of HDi, but I suspect not for long, because VC-1 is their real goal.


On the other hand, I wonder what's in it for Toshiba if HD-DVD falls apart...
 
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