Blu-ray Disc Association: Disc Still Rules!
by Chris Tribbey (Sept 4)
-Home Media Magazine
DENVER — According to Blu-ray Disc proponents, detractors like to say that video on demand and digital downloads will kill physical high-def product, that winning the format war with HD DVD and giving consumers one high-def choice is meaningless.
"I'm fond of recalling the old visions of the past that the paperless office would completely obliterate the need for paper," said Andy Parsons, SVP of advanced product development at Pioneer Electronics and chair of the Blu-ray Disc Association promotion committee in the United States. "It seemed like a very reasonable, logical prediction decades ago that turned out to be completely wrong."
At a recent luncheon during this week's CEDIA Expo in Denver, Parsons, several heads of major studio home entertainment divisions and leading Blu-ray experts ran through the numbers, aiming to prove the detractors are off base.
So far about 15 million Blu-ray Discs have been sold, according to Home Media Magazine market research. Thus far in 2008, 8.8 million Blu-ray Discs have been sold, compared to 5.6 million in all of 2007. With Adams Media Research noting that about 60% of all software sales occur in the fourth quarter, optimism is high among studio executives that 2008 will end well for Blu-ray.
"We always use content sales as a great barometer for how we're doing," Parsons said. "It's a very pure number. It's something real we can look at, and there's no spinning it."
On the hardware side, Global Media Intelligence (GMI) shows that for Blu-ray standalone players, Blu-ray is behind DVD compared to the first few years of the DVD format, in terms of household penetration, with 6.5 million players sold in the United States and 5.5 million in Europe. But those figures don't include sales of the PlayStation 3.
"We honestly don't know what those PS3 users are doing with their players, but obviously some are watching Blu-rays," Parsons said.
GMI predicts that by 2011, all forms of electronically delivered video will still only account for roughly 5% of theatrical and home video revenue.
The numbers don't lie, Parsons said, and the numbers are putting smiles on the faces of studio executives.
"The two can coexist," said David Bishop, president of Sony Pictures Home Entertainment, about physical and digital media. He added that with studios including digital copies of movies with Blu-ray, they're giving consumers everything they could possibly want.
"[Digital Copy] enables us to have movie or TV content more broadly distributed," he said. "In terms of ease of use, it's still skewed toward physical media."
Steve Feldstein, SVP, corporate and marketing communications, 20th Century Fox Home Entertainment, said his studio is considering this fourth quarter the "first fourth quarter" for Blu-ray. "There are no obstacles, no mixed messages for consumers," he said. "It's all Blu."
Chris Fawcett, VP of home video for Sony Electronics, added, "I've said time and time again, movie fans won when the industry unified behind Blu-ray. The thing we have to keep in mind is that the consumers aren't as close to this as we are."
Craig Kornblau, president of Universal Studios Home Entertainment, relayed a story that highlighted that fact, saying he was discussing Blu-ray with a friend last month. She was under the impression that a format war was still going on.
"Consumer education is critically important, still, for our growth as an industry," Kornblau said. "It's a very exciting time for us as a studio, and for all of us as an industry. We're spending a lot of time and money to see what consumers want."
Universal had backed HD DVD before the war ended in February, and Kornblau said his company learned much working with Toshiba that's helping the studio with Blu-ray.
"It's going to be an interesting fourth quarter," he said. "If [household] penetration explodes the way we hope, you might see a lot of these titles we're considering for Blu-ray released a lot quicker than expected."
Bob Chapek, president of Walt Disney Studios Home Entertainment, said everything is going according to his studio's Blu-ray plan, namely the end of the format war, retailers rallying behind Blu-ray with shelf space and sales education.
"You're going to see a landslide of great content now in the fourth quarter," he said. "It's now about penetration, proving that Blu-ray is the complete DVD replacement."
Disc Bridges Digital Divide
by Erik Gruenwede (Aug 28)
-Home Media Magazine
In the drive toward electronic distribution, leave it to old school packaged media to lend a helping — or perhaps more accurately, competing — hand.
Studios are not so quietly ramping up efforts to include a Digital Copy with new and catalog titles on DVD and Blu-ray Disc. The electronic edition typically downloads to a PC or Mac and can be transferred to a laptop or portable media player, including an iPod, iPhone and Sony's PlayStation Portable (PSP), depending on digital rights management (DRM) restrictions.
Piggybacking digital copy with DVD and Blu-ray allows studios to continue mining the lucrative packaged media market while establishing a foothold in electronic distribution and countering piracy.
To underscore the legitimacy of digital copy and provide consumers with a unified theme, DEG: The Digital Entertainment Group Aug. 28 unveiled an industrywide logo that will be included on DVD and Blu-ray releases in the fourth quarter.
"We believe this logo will allow consumers to easily identify which products on DVD and Blu-ray Disc have the added value of a digital copy," said Ron Sanders, president of DEG and of Warner Home Video.
Industry experts say digital copy currently provides no direct incremental revenue to the studios, and instead is seen as an extended bonus feature designed to bolster a title's re-release and create viewing options for new releases.
"Digital copy is viewed more as an indirect financial benefit to the studios that might be expected to draw the type of fans that like to re-play a movie across multiple platforms," said Douglas Dixon, consultant with Manifest Technology. "It's also an attempt by the studios to reduce piracy by offering a free, legitimate alternative that's still wrapped with DRM to prevent further copying."
Rob Enderle, analyst with Enderle Group in San Jose, Calif., said digital copy could impact movie download sites by implying a value-add to packaged media in the consumer's mind.
"It will change the dynamic a bit, but it doesn't address the primary value of downloads, which is video-on-demand. You don't have to get in the car to buy it."
Enderle said the studios should have bowed digital copy sooner as a legitimate countermeasure against piracy.
"Now, the studios have a much better argument against piracy in the courts," he said. "And it's better business."
20th Century Fox Home Entertainment jump-started digital copy in January with the release of the first digital copy on the animated "Family Guy" "Star Wars" parody DVD Family Guy Presents: Blue Harvest.
Fox continues to outpace all studios with digital copy and Sept. 23 will re-release 20 catalog titles on DVD ($19.98 each) with digital versions, including Napoleon Dynamite, Office Space, The Girl Next Door, Grandma's Boy, There's Something About Mary, Dodgeball, Super Troopers, Behind Enemy Lines, The Day After Tomorrow, Die Hard, Fantastic Four, Hide & Seek, I Robot, Independence Day, Speed, The Transporter, X-Men, X2: X-Men United, X3: The Last Stand, and Reno 911: Miami, More Busted Than Ever (unrated edition).
The studio's previous digital copy releases on home video include Alien vs. Predator: Requiem (Blu-ray), Alien vs. Predator: Requiem — Special Edition (unrated DVD), Hitman: Digital Copy Special Edition (unrated DVD), Jumper: 2-disc Special Edition (DVD), Jumper (Blu-ray), Juno: 2-disc Special Edition (DVD), Juno (Blu-ray), Live Free or Die Hard (2-disc: unrated DVD with Windows Media-compatible digital copy), Street Kings: 2-disc Special Edition (DVD), Street Kings (Blu-ray), What Happens In Vegas: 2-disc Special Edition (DVD) and What Happens In Vegas (Blu-ray).
"Our research shows that when given the option, consumers recognize the value proposition that digital copy provides as a simple, fast way to move content to a portable device," said Mary Daily, EVP, North America marketing, TCFHE.
But Fox isn't the only studio on the digital copy bandwagon.
Sony Pictures Home Entertainment Nov. 25 releases Hancock, the studio's tentpole summer theatrical hit, on DVD with a digital copy and, in a first for the studio, on Blu-ray with a digital copy.
Sony's digital copy, which is not compatible with Mac or iPod, is included with previous DVD releases Hero Wanted, Diamond Dogs, The Cottage, Cleaner, The Tattooist, Vantage Point: Special Edition, Impact Point, Insanitarium, Starship Troopers 3: Marauder, 21, The Art of War II, Made Of Honor and You Don't Mess With The Zohan, in addition other catalog fare.
Rich Marty, VP of new business development for the studio, said consumer response to previous Sony digital copy releases prompted additional titles in the fourth quarter.
"We're seeing accelerated redemptions as the feature is becoming more familiar to the consumer," Marty said. "As more titles come out, it will be seen as a real consumer benefit to packaged media."
He said digital copy demonstrates the flexibility of packaged media and how it can adapt to consumer trends.
"It's another great feature to reinvigorate the packaged media business," Marty said.
Universal Studios Home entertainment released American Gangster (HD DVD), The Mummy: Deluxe Edition and The Mummy Returns: Deluxe Edition with digital copy. The studio plans to include an electronic file with future new and catalog DVD and Blu-ray releases such as Forgetting Sarah Marshall, The Incredible Hulk, Hellboy II: The Golden Army, Wanted and The Mummy: Tomb of the Dragon Emperor, among others, according to spokesperson Lea Porteneuve.
Anchor Bay Entertainment on Oct. 28 releases Dead Space: Downfall on DVD ($26.97), the distributor's first Blu-ray ($34.98) title featuring digital copy.
Walt Disney Home Entertainment Aug. 26 re-released Tim Burton's The Nightmare Before Christmas: Collector's Edition on DVD ($32.99) and Blu-ray ($39.99) — the studio's first title with digital copy, which it calls "Disneyfile."
Future releases with digital copy include DVD and Blu-ray editions of Wall-E Nov. 18 and The Chronicles of Narnia: Prince Caspian Dec. 2.
Lionsgate released Rambo, The Eye, Tyler Perry's Meet The Browns and The Bank Job with digital editions in both DVD and Blu-ray; on Sept. 8 it will do the same with The Forbidden Kingdom.
Curt Marvis, president of digital media at the mini-major, said the consumer doesn't see a rigid demarcation line between packaged media and digital. He said digital copy offers consumers versatility while supporting retailers and the home entertainment business.
Warner Home Video last year offered so-called "e-copies" versions of Superman Returns, Blood Diamond, 300 and Ocean's 13 with the standard DVD, which required submitting a coupon and an additional charge for the Web-based download.
This year, the studio offered digital copies with special edition multiple disc DVD releases of Harry Potter and the Order of the Phoenix and I Am Legend with Will Smith.
Other titles included Harold & Kumar: Escape from Guantanamo Bay on DVD (with coupon) and Blu-ray, Lost Boys: The Tribe on DVD and Blu-ray and 10,000 B.C. on Blu-ray.
Future releases with digital copy include Speed Racer Sept. 16 on DVD and Blu-ray, Sex And The City special edition DVD and Blu-ray, Run Fatboy Run (both Sept. 23) on Blu-ray, and Fred Clause (Nov. 25) on DVD and Blu-ray.