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5 Catagories (buyers) of Production Adoption

Lee Stewart
04-05-2009, 12:42 PM
INNOVATORS.
The first people in a society to adopt a new product are the innovators. These people are risk takers and may be looking for new products to try. They represent only 2.5 percent of the population. Though these people are the first to try a product, they are not usually opinion leaders. Consequently, they do not pass information about the product to the rest of the population.

EARLY ADOPTERS.
The early adopters have many opinion leaders in their ranks. They are the first people in the neighborhood to try a new product, and many of them willingly pass the information about the product onto other people. Their experiences can determine whether a product will have a long or short life cycle. They represent about 13.5 percent of the population.

EARLY MAJORITY.
Once the early adopters have tried and given their approval to a product, the early majority will begin to follow. 34 percent of the population is in this category. Since they represent such a large percent of the population, the adoption by the early majority causes the new product to enter a period of rapid growth.

LATE MAJORITY.
After a significant portion of the population has adopted a product, the late majority will consider its use. These people are not risk takers; they typically wait until they see the product approved by others. They also represent about 34 percent of the population. Once they have adopted the product, the innovators, early adopters, early majority, and late majority represent a total of about 84 percent of the population. By this point, the new product will have reached its maturity.

LAGGARDS.
The last category of society to adopt a new product is generally fearful about trying new things. Often, they wait until being forced to adopt because the alternate product is no longer being produced. The laggards represent about 16 percent of the population.

http://www.referenceforbusiness.com/management/Or-Pr/Product-Life-Cycle-and-Industry-Life-Cycle.html

bruceames
04-05-2009, 12:47 PM
So I'm an innovator because I bought an HD DVD player on launch day? Nice. :cool:

Lee Stewart
04-05-2009, 01:10 PM
So I'm an innovator because I bought an HD DVD player on launch day? Nice. :cool:

For that product you would be.

How about your HDTV? When did you buy your first one?

bruceames
04-05-2009, 01:22 PM
For that product you would be.

How about your HDTV? When did you buy your first one?

I probably wouldn't qualify there. I bought my first one in 2003. Maybe that's late early adopter territory? :what:

Lee Stewart
04-05-2009, 01:38 PM
I probably wouldn't qualify there. I bought my first one in 2003. Maybe that's late early adopter territory? :what:

Maybe an Early Majority?

I was an Innovator with my HDTV purchase (1998) but an Early Adopter for HD DVD (Jan. 2007)

DonnyDC
04-05-2009, 02:05 PM
Maybe an Early Majority?

I was an Innovator with my HDTV purchase (1998) but an Early Adopter for HD DVD (Jan. 2007)Naw I think anyone who regularly bought HDDVDs or Blurays during the format war would automatically be in the innovator category.

Stew4HD
04-05-2009, 02:11 PM
My first HDTV was bought in early 2000.. I come close to an innovator :D I was a little late with HD DVD since I bought in late '06 and a PS3 when it was launched for Bluray..
I guess I fit the "early adopter" adopter catagory, albeit very early

PFC5
04-05-2009, 04:09 PM
I was late to the HDTV party not buying in until 2004. I wanted at least a decent about of HD content since when I looked at larger HDTVs with SD back then it looked worse than my 36" tube SDTV, so I waited.

I bought my first HD DVD player in 6/2006 because I had to wait almost 1 month for it to be re-supplied in stock. I bought my first BD player with a launch PS3 (60GB) in 11/2006.

Here is how I classify myself based on those definitions:

HDTV = Early Majority
HD DVD = Innovator
BD = Early Adopter (since I didn't buy a launch Samsung SAL BD player in 6/2006)

Lee Stewart
04-05-2009, 07:00 PM
Applying the OP to BD the format . . .

The last published % of USA HH's that have a BD player (which includes the PS3) was 10%.

When you add the Innovators and Early Adopters you get 16%.

That would mean based on the info in the OP that BD the format is still in the Early Adopter market and will remain so for most of this year.

HD Goofnut
04-05-2009, 08:04 PM
I suppose I would be an early adopter for HDTV, HD DVD, and BD.

mytime
04-05-2009, 08:19 PM
Laggards. :lol: Struck me funny.

8ch-DeeorDie
04-05-2009, 09:46 PM
Laggards. :lol: Struck me funny.

I know what you mean.:D

My Grandmother bought her FIRST dvd player 3 months ago.:what::banghead:

kamspy
04-05-2009, 10:09 PM
HT Stuff: Early majority
VG stuff: Innovator
Basic Common Sense: Laggard

HD Goofnut
04-05-2009, 10:26 PM
I will add that I am a laggard when it comes to mp3s. When I buy music I still CDs and I just never caught on with the mp3 thing.

kamspy
04-05-2009, 11:06 PM
I will add that I am a laggard when it comes to mp3s. When I buy music I still CDs and I just never caught on with the mp3 thing.

What the hell is "buying music"?:confused:

mswoods1
04-05-2009, 11:11 PM
What the hell is "buying music"?:confused:

It's when you flush money down the toilet.

mswoods1
04-05-2009, 11:11 PM
P.S. Unless you're supporting a band you enjoy.

Kosty
04-05-2009, 11:14 PM
Applying the OP to BD the format . . .

The last published % of USA HH's that have a BD player (which includes the PS3) was 10%.

When you add the Innovators and Early Adopters you get 16%.

That would mean based on the info in the OP that BD the format is still in the Early Adopter market and will remain so for most of this year.
When you are having new titles get above 20% Blu-ray market share on their release week you are moving past 2.5% + 13.5% = 16% market share so you are dipping into early majority territory. So expect rapid growth for Blu-ray this fall.

Look at the charts that track the release week Blu-ray market shares for action adventure and family titles. When a majority start getting over 16% Blu-ray market share, thats evidence of early majority software sales that are being driven by early majority hardware household penetration for Blu-ray.

I'd say Blu-ray is between early adoption and entering early majority stage where it will be firmly placed by the end of this year.

Evidence : Top 20 title Blu-ray market share growth. First week Blu-ray market share of day and date titles, Top 20 title unit growth and overall revenue growth is not accelerating at a pace more appropriate to early majority movement and scales.


You can obviously see the growing trend for first week Blu-ray market share.

Latest weeks on bottom.


Okay then, here's the first-week percentage chart for action/adventure titles I'd been working on:


Date Title Genre W1 sales%
032409 Quantum of Solace Action 28
031709 Punisher: War Zone Action 19
031009 Let the Right One In Horror 22
Transporter 3 Action 19
021709 Body of Lies Thriller 21
Midnight Meat Train Horror 16
Quarantine Horror 16
012709 Lakeview Terrace Thriller 9
RockNRolla Action 23
012009 Max Payne Action 21
Saw V Horror 11
011309 Mirrors Horror 13
010609 Babylon A.D. Action -
Bangkok Dangerous Action -
Righteous Kill Thriller -
123008 Eagle Eye Action -
121608 The Mummy: Tomb of... Action -
120908 The Dark Knight Action 21*
120208 Wanted Action -
X-Files I Want to Believe Sci-fi -
112508 Hancock Action 15
111108 Hellboy II Action -
102808 Journey to the Center... Adventure 10
102108 Incredible Hulk Action 19
The Strangers Horror 7
101408 Indiana Jones IV Action -
100708 The Happening Horror 8
093008 Iron Man Action 17
090908 The Forbidden Kingdom Action 12
081908 Prom Night Horror 4
Scorpion King 2 Action 7
Street Kings Thriller 9
072908 Doomsday Action 13
Lost Boys: The Tribe Horror 7
Stargate: Continuum Sci-Fi 9
071508 The Bank Job Thriller 12
Shutter Horror 5
070808 The Ruins Horror 7
070108 Vantage Point Thriller 9
060308 The Eye Horror 6
052608 Rambo Action 13
051908 National Treasure 2 Adventure 7




http://img4.imageshack.us/img4/5418/actionadventurefirstwee.jpg

Drama should be on the charts as well.

http://img9.imageshack.us/img9/5250/familyk.jpg

This seems to be growing as well.
And for completeness' sake, here are the first-week ratios for comedies, dramas and everything else (theatrically released titles only):


Date Title Genre W1 sales%
032209 Bolt Animation 20*
031009 Cadillac Records Drama 6
Milk Drama 10
Rachel Getting Married Drama 5
Role Models Comedy 12
030309 Australia Drama 12
Beverly Hills Chihuahua Comedy 3
022409 Sex Drive Comedy 13
021709 Changeling Drama 8
High School Musical 3 Musical 5
021009 Miracle at St. Anna Drama 18
Nights in Rodanthe Romance 8
Soul Men Comedy 4
W. Drama 9
020309 Madagascar Escape 2 Animation 9
Nick and Norah's... Comedy 8
The Secret Life of Bees Drama 3
Space Buddies Family 3
Zack and Miri Make... Comedy 11
012709 Pride and Glory Drama 17
Vicky Cristina Barcelona Comedy 7
012009 Igor Animation 6
The Express Drama 10
011309 Appaloosa Western 12
My Best Friend's Girl Comedy 8
Swing Vote Comedy 6
010609 Pineapple Express Comedy -
122308 Burn after Reading Comedy -
121608 Mamma Mia! Musical -
120908 Horton Hears a Who! Animation -
120208 Step Brothers Comedy -
112508 Fred Claus Family 4
111808 Tropic Thunder Comedy -
Wall•E Animation -
110408 Get Smart Comedy 8
Kung Fu Panda Animation 6
100708 You Don't Mess w/ Zohan Comedy 7
093008 Forgetting Sarah Marshall Comedy 8
092308 Leatherheads Comedy 6
Sex and the City Comedy 3
082608 What Happens in Vegas Comedy 4
081908 Camp Rock Musical 1
Hannah Montana Music 4
080508 Nim's Island Family 2
072908 Shine a Light Music 11
072908 Harold & Kumar Escape... Comedy 7
072208 21 Drama 8
071508 College Road Trip Comedy 1
Step Up 2: The Streets Drama 2
070108 Drillbit Taylor Comedy 4
Meet the Browns Comedy 1
061008 The Bucket List Comedy 3
The Other Boleyn Girl Drama 4
060308 Meet the Spartans Comedy 4
Semi-Pro Comedy 7
050608 First Sunday Comedy 3





http://img9.imageshack.us/img9/7858/unitbarmar22.jpg

http://img4.imageshack.us/img4/774/revbarmar29y.jpg

http://img17.imageshack.us/img17/2338/top20unitpiemar29.jpg



http://img4.imageshack.us/img4/1839/revsharemar29.jpg

kamspy
04-05-2009, 11:20 PM
It's when you flush money down the toilet.

:roflmao:

P.S. Unless you're supporting a band you enjoy.

Bands make the most from concerts and merch. So if someone wants to 'support' a band, buy some tickets and a t-shirt from their website.

My post was a joke though. I don't pirate music. It's like poking a retarded kid with a stick.

kamspy
04-05-2009, 11:22 PM
***stealth BD Troll Thread beaten down by graphs and sales numbers***
*Quote condensed for easier thread reading




Good post! Nice to have some balance here at the boards.

Kosty
04-06-2009, 01:06 AM
*Quote condensed for easier thread reading


Good post! Nice to have some balance here at the boards.

Just trying to preserve some order in the universe. :D

Nikopol
04-06-2009, 02:04 AM
I agree that Blu-ray is very likely in the phase between early adopter and the early majority. It's funny, that the article/website is giving numbers with a 0.5 accuracy for something, that cannot be measured this precicely.... :lol:

PFC5
04-06-2009, 02:07 AM
I agree that Blu-ray is very likely in the phase between early adopter and the early majority. It's funny, that the article/website is giving numbers with a 0.5 accuracy for something, that cannot be measured this precicely.... :lol:

Easiest way to "sound" like you have good numbers is to quote % to the decimal level. :D

I believe my statement is 99.8% accurate. :lol:

dsskid
04-06-2009, 06:52 AM
I might be considered an early adopter in the display catagory (2003), probably early majority when it comes to BD (March 2008), and definitely a laggard when it comes to MP3s and downloading music.

MikeRox
04-06-2009, 07:50 AM
I might be considered an early adopter in the display catagory (2003), probably early majority when it comes to BD (March 2008), and definitely a laggard when it comes to MP3s and downloading music.

I'd say BD is only just entering the early majority stage now.

I picked up my HDTV in January 2007, and then a HD DVD add on in May 2007 (HD DVD only launched in December 2006 here so it was still fairly early) and my Blu-ray player (PS3) I picked up in October 2007. So I'd say I'm generally an early adopter now for things.

Though on the HDTV I'm not too sure, as if you base it on userbase, I'm definitely early adopter, but on timescale it's quite late on. HDTV penetration was less than 10% in the UK when I got one.

BobY
04-06-2009, 08:00 AM
One always has to be careful when comparing percentages rather than absolute numbers, that the comparison is relevant.

For example, the percentage of market share of top 20 titles has little bearing on this particular discussion, as the percentages of the groups in the OP are the total consumer population, while the top 20 market share figures are (obviously) only the top 20 sales, not the total population of discs sold.

Even then, you are comparing a massive, mature, declining market (DVD) with a much smaller, early, growing market (BD), which skews the perception of market share (BD could increase it's market share even by selling the same or less discs than the previous month if DVD happens to sell significantly less--while this is a desirable increase in market share, it doesn't indicate growth and can even represent a decline in BD sales) .

Overall Blu-Ray's numbers are certainly a good trend, but the numbers that are relevant to this particular discussion (i.e. where Blu-Ray falls in the 5 categories of buyers in the OP) are the number of consumers who own BD players and watch BD movies on a regular basis, and individual title sales, as those numbers will give you market penetration compared to potential, not relative to whether a market is in a growth phase or a decline phase or anything else which may skew the data.

Assuming the numbers in the OP article are correct (I'm not saying they are), until Blu-Ray has sold over 16% of the population (2.5% Innovators plus 13.5% Early Adopters), it's still in the Early Adopter phase. If we count the population as US households (US Census Bureau estimates between 110 Million and 128 Million households in 2007), then Blu-Ray needs to sell a player to between 17.6 Million and 20.5 Million individual US households for it to move into the "Early Majority" phase in this county.

Even if you count all PS3's as active Blu-Ray players (and the disparity between PS3 unit sales and individual BD title sales shows that not to be the case), that certainly hasn't happened yet, although, depending on the economy it could possibly happen this year.

dsskid
04-06-2009, 08:30 AM
:thumbsup:I'd say BD is only just entering the early majority stage now.

I picked up my HDTV in January 2007, and then a HD DVD add on in May 2007 (HD DVD only launched in December 2006 here so it was still fairly early) and my Blu-ray player (PS3) I picked up in October 2007. So I'd say I'm generally an early adopter now for things.

Though on the HDTV I'm not too sure, as if you base it on userbase, I'm definitely early adopter, but on timescale it's quite late on. HDTV penetration was less than 10% in the UK when I got one.

Thanks Mike. I just figured that since I waited out the format war, I'd be classified as early majority. But in the big scheme of things, what does it matter? Afterall, I am enjoying movies. :thumbsup:

HD Goofnut
04-06-2009, 08:34 AM
One always has to be careful when comparing percentages rather than absolute numbers, that the comparison is relevant.

For example, the percentage of market share of top 20 titles has little bearing on this particular discussion, as the percentages of the groups in the OP are the total consumer population, while the top 20 market share figures are (obviously) only the top 20 sales, not the total population of discs sold.

Even then, you are comparing a massive, mature, declining market (DVD) with a much smaller, early, growing market (BD), which skews the perception of market share (BD could increase it's market share even by selling the same or less discs than the previous month if DVD happens to sell significantly less--while this is a desirable increase in market share, it doesn't indicate growth and can even represent a decline in BD sales) .

Overall Blu-Ray's numbers are certainly a good trend, but the numbers that are relevant to this particular discussion (i.e. where Blu-Ray falls in the 5 categories of buyers in the OP) are the number of consumers who own BD players and watch BD movies on a regular basis, and individual title sales, as those numbers will give you market penetration compared to potential, not relative to whether a market is in a growth phase or a decline phase or anything else which may skew the data.

Assuming the numbers in the OP article are correct (I'm not saying they are), until Blu-Ray has sold over 16% of the population (2.5% Innovators plus 13.5% Early Adopters), it's still in the Early Adopter phase. If we count the population as US households (US Census Bureau estimates between 110 Million and 128 Million households in 2007), then Blu-Ray needs to sell a player to between 17.6 Million and 20.5 Million individual US households for it to move into the "Early Majority" phase in this county.

Even if you count all PS3's as active Blu-Ray players (and the disparity between PS3 unit sales and individual BD title sales shows that not to be the case), that certainly hasn't happened yet, although, depending on the economy it could possibly happen this year.

So Boby you're a laggard when it comes to BD right?:p

Lee Stewart
04-06-2009, 09:09 AM
So Boby you're a laggard when it comes to BD right?:p

I am. :lol:

Nikopol
04-06-2009, 09:15 AM
So Boby you're a laggard when it comes to BD right?:p

'Laggards' are still using VHS instead of DVD :D I know some people :p want to wear the Blu-laggard badge with honors. But sorry, it ain't THAT easy. :lol:

BobY
04-06-2009, 09:21 AM
So Boby you're a laggard when it comes to BD right?:p

I don't know, is there a category after laggard? :D

As I've often said, I'll buy into BD as soon as they offer enough content I'm interested in for it to be worthwhile to me. That is assuming such content in HD doesn't become more easily and less expensively available in the meantime--now that my Son is older and doesn't watch films over and over again, I no longer have much desire to own shiny plastic discs which take up space in my house, unless it's something really special. I even replaced all of my records and CD's with MP3's and got rid of the original physical media, which opened up a lot of room in my Home Office/Library, which is where I listen to music.

I guess if Blu-Ray never gets around to offering enough content I'm interest in, I go into the unmentioned Category 6--"Don't Have it and Don't Care" ;)

bmore
04-06-2009, 09:28 AM
'Laggards' are still using VHS instead of DVD :D I know some people :p want to wear the Blu-laggard badge with honors. But sorry, it ain't THAT easy. :lol:

But you can't knock their effort. ;)

Especially all of the self-proclaimed "HD(TV) enthusiasts/addicts".

BobY
04-06-2009, 10:20 AM
Not to mention the self-appointed "HD Police" who don't know seem to know the difference between "HD" and "Blu-Ray" :rolleyes:

(Hint: "HD" is a technology owned by about 30-35% of US households and "Blu-Ray" is a technology owned by about 10% of US households--assuming all PS3's are used as Blu-Ray players).

Kosty
04-06-2009, 10:37 AM
One always has to be careful when comparing percentages rather than absolute numbers, that the comparison is relevant.

For example, the percentage of market share of top 20 titles has little bearing on this particular discussion, as the percentages of the groups in the OP are the total consumer population, while the top 20 market share figures are (obviously) only the top 20 sales, not the total population of discs sold.

Even then, you are comparing a massive, mature, declining market (DVD) with a much smaller, early, growing market (BD), which skews the perception of market share (BD could increase it's market share even by selling the same or less discs than the previous month if DVD happens to sell significantly less--while this is a desirable increase in market share, it doesn't indicate growth and can even represent a decline in BD sales) .

Overall Blu-Ray's numbers are certainly a good trend, but the numbers that are relevant to this particular discussion (i.e. where Blu-Ray falls in the 5 categories of buyers in the OP) are the number of consumers who own BD players and watch BD movies on a regular basis, and individual title sales, as those numbers will give you market penetration compared to potential, not relative to whether a market is in a growth phase or a decline phase or anything else which may skew the data.

Assuming the numbers in the OP article are correct (I'm not saying they are), until Blu-Ray has sold over 16% of the population (2.5% Innovators plus 13.5% Early Adopters), it's still in the Early Adopter phase. If we count the population as US households (US Census Bureau estimates between 110 Million and 128 Million households in 2007), then Blu-Ray needs to sell a player to between 17.6 Million and 20.5 Million individual US households for it to move into the "Early Majority" phase in this county.

Even if you count all PS3's as active Blu-Ray players (and the disparity between PS3 unit sales and individual BD title sales shows that not to be the case), that certainly hasn't happened yet, although, depending on the economy it could possibly happen this year.

I fully agree that the penetration of hardware owners would be the more relevant statistic but we don't have those numbers.

But if we assume movie buying habits follow ownership of hardware then the software sales growth indicates that we are further along the growth path than the OP would lead to believe. So thats why I'm saying that we are just entering the early majority stage and its implications for rapid growth.

Starting in the next couple months as new generation Blu-ray players arrive at retail and accelerating in September 2009 Blu-ray hardware sales will significantly accelerate in accordance in what will happen in the early majority phase with its rapid growth.

That assessment is more optimistic than the comment that we will stay in early adopter phase throughout all of this year. That I think is just wrong.

Even if household penetration doesn't rise to a magic percentage threshold, the theory is a guideline only in percentages, and the actions of consumers will be fully in sync with early majority consumer behavior.

bmore
04-06-2009, 12:16 PM
Not to mention the self-appointed "HD Police" who don't know seem to know the difference between "HD" and "Blu-Ray" :rolleyes:

Well, we are in the "High Definition DVDs & Movies > High Definition Media" section. Which is traditionally biased towards disc based media.

I think it is more than fair to attribute HD to bluray in this particular section of the forum, given it's history and the general understanding of participants in this particular MEDIA section.

If I wanted to talk about Cab/Sat HD content I would go elsewhere. And for some odd reason, not too many threads about Vudu or AppleTV pop up in this section...I wonder why? Must be some conspiracy or something....or simply that the participants in this particular section care a great deal more about disc based media, in particular when it is on media that currently affords for the greatest quality in the home.

BobY
04-06-2009, 09:51 PM
Well, we are in the "High Definition DVDs & Movies > High Definition Media" section. Which is traditionally biased towards disc based media.

I think it is more than fair to attribute HD to bluray in this particular section of the forum, given it's history and the general understanding of participants in this particular MEDIA section.

If I wanted to talk about Cab/Sat HD content I would go elsewhere. And for some odd reason, not too many threads about Vudu or AppleTV pop up in this section...I wonder why? Must be some conspiracy or something....or simply that the participants in this particular section care a great deal more about disc based media, in particular when it is on media that currently affords for the greatest quality in the home.

Yessir, Officer Bmore, Sir, but I was only responding to the OP and the conclusions being drawn. I thought that's what forums were for.

Oops I forgot. This is the section of the forum where we all have to bow down and worship Blu-Ray and never say anything negative or point out any issues and pretend that Blu-Ray is the only source of HD and that there can never be anything other than Blu-Ray and that pixels are more important than content.

Sorry Officer, I promise it won't happen again. Honest. :rolleyes:

BobY
04-06-2009, 11:40 PM
I fully agree that the penetration of hardware owners would be the more relevant statistic but we don't have those numbers.

I'm not sure the lack of relevant numbers is a good reason to base an analysis on possibly irrelevant numbers :D

I certainly acknowledge that Blu-Ray is growing and, assuming the economy doesn't torpedo it, will likely break the 16% penetration mark this year (if one counts all PS3's as Blu-Ray players).

On the other hand, they sold around 17 Million LaserDisc players and around 20 Million SACD players (including SACD-capable DVD players). On the other, other hand, academic marketing theory says when you get to about 20% penetration with consumers, you're mainstream:what:

But if we assume movie buying habits follow ownership of hardware then the software sales growth indicates that we are further along the growth path than the OP would lead to believe. So thats why I'm saying that we are just entering the early majority stage and its implications for rapid growth.

I was only commenting on the OP article--by that standard Blu-Ray has a way to go before it is out of the Early Adopter phase. I don't think software sales growth can be used as a judge of market penetration. A relatively small group of hardware owners who buy every title released would be great for revenue, but wouldn't give an accurate picture of market share--it would still be a small group.

Some of the numbers that interest me are:

1) The total number of Blu-Ray discs reported sold compared to the number of titles available--this yields an average unit-sales-per-title in the low Tens of Thousands. Are the studios happy with the vast majority of BD titles selling in such small numbers, especially given the costs of BD authoring and production? What does that bode for having a large variety of titles in a timely fashion?

2) The total number of disc sales of Megahit titles like "Iron Man" or "TDK" versus the installed base of players--the most successful BD titles haven't even sold half of the installed base of PS3's. This during the early adopter phase with limited content availability. I mean, what should sell better than a Megahit film, targeted directly at the majority of owners, during the early adopter phase of an exciting, new technology, with a limited library to choose from?

I make two basic assumptions here:

With a huge, well-established, mature, declining market like DVD, no movie title will have a significant attach rate to the hardware base, as the base is simply too large and tastes in movies too varied.

With a small, early-adopter, new, growing market like Blu-Ray, it should be fairly easy for a movie title to achieve a huge attach rate to the hardware base, as the base is relatively small and the early adopters, who are excited about this technology, should be very hungry for content.

While Blu-Ray is obviously growing, it's clearly not growing at the rate hoped for--Blu-Ray has missed every metric they ever released to the public and Studios like Disney and others wouldn't be offering a DVD with their Blu-Ray releases or experimenting with staggered releases of Blu-Ray and DVD if they were satisfied with Blu-Ray sales. These are clearly efforts to make BD more desirable to consumers.

Starting in the next couple months as new generation Blu-ray players arrive at retail and accelerating in September 2009 Blu-ray hardware sales will significantly accelerate in accordance in what will happen in the early majority phase with its rapid growth.

I think disc pricing is more key than player pricing at this point--the player is a one time cost while the discs are ongoing. Regardless of the hardware base, high disc costs could lead to more renting of BD's (which wouldn't thrill the studios) and even the continued purchase of films on DVD by Blu-Ray owners for those films they simply don't think are worth the extra money (I couldn't find it, but somewhere in the archives there's a link to a Nielsen or Harris poll which indicated the majority of Blu-Ray owners were still buying DVD's.)

That assessment is more optimistic than the comment that we will stay in early adopter phase throughout all of this year. That I think is just wrong.

I think there's a good chance BD will move past the Early Adopter phase by the end of the year, but I don't think disc sales market share can be used as the criteria--it has to be the number of consumers who bought players--there is no reason they can't get these numbers.

Even if household penetration doesn't rise to a magic percentage threshold, the theory is a guideline only in percentages, and the actions of consumers will be fully in sync with early majority consumer behavior.

I agree the percentages are rather arbitrary, but they are consistent with academics and past history. IMO, household penetration is the only sensible criteria for assessing the phase the market is in.

Kosty
04-07-2009, 04:22 AM
All of your considerations are valid, and are concerns by the involved parties.

But public Blu-ray benchmarks made during the format war or before the recession are not the best judge of where Blu-ray progress should be.

Last fall was planned year and years ago to be the mass market introduction for Blu-ray and great strides were made in it penetration into USA households. That will advance a lot more in upcoming months as future hardware sales accelerate.

A lot of Blu-rat titles have sold 10000-50000 units but most have made money from a cost standpoint even at that low volume, the issues are making more money on catalog titles so that source restoration is profitable. But those released Blu-ray titles have a long shelf life and even if not sold immediately have a long sales tail and continue to accumulate sales. The primary concern is encouraging retailers to show more titles.

I agree the percentages are rather arbitrary, but they are consistent with academics and past history. IMO, household penetration is the only sensible criteria for assessing the phase the market is in. I know that they work and are a great paradigm, but what I meant was that if the 2.5% + 13.5% = 16% is the theory, that Blu-ray can be showing the indications of early majority consumer behavior at a slightly different benchmark.

With Blu-ray there is the issue of how to count PS3s as hardware in household penetration. At any rate, by the end of this year, its likely that standalone and PS3 units will be enough to be over 16% of the $116 M or so USA households.

So thats getting into early majority territory. If that number is close and there is rapid growth that is typically associated with that phase, then its say to say that Blu-ray is in that point of its mass market consumer lifecycle.

MikeRox
04-07-2009, 05:14 AM
Actually basing penetration on marketshare isn't too bad a measure. I mean it's a marketshare of the whole market the product is aimed at. Yes early adopters "skew" percentages by buying a large amount of titles, but that large amount of titles is a large amount of titles no longer being purchased on DVD which it is being compared with, and so if 1% of users buy 30% of the titles, thats still 30% of the market.

ack_bak
04-07-2009, 08:41 AM
As demonstrated by the recent release of "Quantum of Solace" where the Blu-Ray version of the movie attained a 28% marketshare of all home video sales of the movie, Blu-Ray is quickly heading to be a mainstream product (if it is not there already).

With $99 BD player hardware around the corner in Q4, I think you will continue to see the product grow and will continue to see a drop in overall DVD sales and shipments. Retailers will continue to add Blu-Ray shelf space for both hardware and software at the expense of DVD and consumer confidence in Blu-Ray will continue to grow while confidence in DVD will continue to decline.

I expect 2010 to be a banner year with more abundant hardware at $100 and below price points and hopefully an economy that will start to show some signs of life.

Kosty
04-07-2009, 10:03 AM
http://www.nclnet.org/news/2009/ncl_dvdsurvey_report_04062009.pdf

page 12/37 of the pdf of this new study of consumer DVD habits puts Blu-ray household household penetration at 18%. (probably counting PS3s)

HD Goofnut
04-07-2009, 10:10 AM
As demonstrated by the recent release of "Quantum of Solace" where the Blu-Ray version of the movie attained a 28% marketshare of all home video sales of the movie, Blu-Ray is quickly heading to be a mainstream product (if it is not there already).

With $99 BD player hardware around the corner in Q4, I think you will continue to see the product grow and will continue to see a drop in overall DVD sales and shipments. Retailers will continue to add Blu-Ray shelf space for both hardware and software at the expense of DVD and consumer confidence in Blu-Ray will continue to grow while confidence in DVD will continue to decline.

I expect 2010 to be a banner year with more abundant hardware at $100 and below price points and hopefully an economy that will start to show some signs of life.

I totally agree with you ack. It was 2002 (5th year) before SD DVD took off and truly dethroned VHS. It will be 2010 or 2011 when BD takes off and dethrones SD DVD.

Nikopol
04-07-2009, 10:38 AM
http://www.nclnet.org/news/2009/ncl_dvdsurvey_report_04062009.pdf

page 12/37 of the pdf of this new study of consumer DVD habits puts Blu-ray household household penetration at 18%. (probably counting PS3s)

This was an online survey. Page 2 from the pdf:

Objectives and Methodology

The National Consumers League conducted this survey to ascertain consumer attitudes and expectations related to the consumers DVD market in general and specifically whether consumer habits related to copying and backup were translating from the CD market to the DVD market.

1,000 online surveys were administered to adults 18-64, who personally own a desktop or laptop computer, between Wednesday, March 11thand Monday, March 16th, 2009.

Data was then weighted to better represent the national Internet population. Variables included in the weighting are gender, region, age, and race.

As much as i would like to think that it represents all of US households, i don't think it does. ;)

Lee Stewart
04-07-2009, 10:49 AM
http://www.nclnet.org/news/2009/ncl_dvdsurvey_report_04062009.pdf

page 12/37 of the pdf of this new study of consumer DVD habits puts Blu-ray household household penetration at 18%. (probably counting PS3s)

That % is high based on 8.5M PS3's in the USA and 4M (?) SAL's.

http://www.vgchartz.com/

114M USA HH's. 18% would be 20M which as you can see is way above existing installed BD players.

That PDF is based on an online survey of 1000 people. Not a large sample at all.

Kosty
04-07-2009, 11:18 AM
I think you are right. I trust online information as far as I can throw them unless its part of a few companies respondent pool of Internet available participants that are still then randomly selected.

But this seems to be more than a casual Internet poll, at least they attempted to get a demographic check and the other penetration numbers seem order of magnitude correct.

But self selection bias would probably overstate PS3 owners on any tech issue on an Internet poll.

The numbers do not seem to add up.

But we will get some quarterly Blu-ray hardware sales soon... Theres been three months of some hardware sales from the time that last 4 M figure IRC was released.

DonnyDC
04-07-2009, 11:42 AM
This was an online survey. Page 2 from the pdf:

As much as i would like to think that it represents all of US households, i don't think it does. ;)It being online means the consumers are on average should be a bit more tech savvy. That said theyre the market that the BDA is more interested in anyways. The people owning 90+ dvds.
Consulting."

MikeRox
04-08-2009, 05:26 AM
That % is high based on 8.5M PS3's in the USA and 4M (?) SAL's.

http://www.vgchartz.com/

114M USA HH's. 18% would be 20M which as you can see is way above existing installed BD players.


That assumes every household purchases exactly the same number of discs though. Wrong way of looking at it. I wouldn't be surprised if 20% of the DVD userbase bought 80% of the discs.

Nikopol
04-08-2009, 05:48 AM
It being online means the consumers are on average should be a bit more tech savvy. That said theyre the market that the BDA is more interested in anyways. The people owning 90+ dvds.
Consulting."

It's hardly a plausible way to quantify how many BD players are in US households. Which was the question. ;)

Lee Stewart
04-08-2009, 05:52 AM
That assumes every household purchases exactly the same number of discs though. Wrong way of looking at it. I wouldn't be surprised if 20% of the DVD userbase bought 80% of the discs.

For % of HH's - they are counting players - not discs bought.;)

MikeRox
04-08-2009, 06:06 AM
HHs at the same time don't really figure into a formats establishment though. I can have 60% of the home video market with 10% household penetration.

Nikopol
04-08-2009, 06:54 AM
I think we have been running in the wrong direction here. The five groups in the OP are from Everett M. Rogers' theory of Diffusion of Innovations.

http://en.wikipedia.org/wiki/Everett_Rogers

The groups have to be seen in context with the typical Bell curve of a format's life cycle.
http://i271.photobucket.com/albums/jj159/fud-central-you-freak/charts/Scurvebellcurve-1.png
They are related to the individual product, in our case the Blu-ray format.

The logical error that imo was made here was the assumption, that only if e.g. 50% of the complete US population ('households') have adopted a product, the early majority phase was left behind. However that is not, what this theory is about.

Rogers theorized that innovations would spread through a community in an S curve,[2] as the early adopters select the innovation (which may be a technology) first, followed by the majority, until a technology or innovation has reached its saturation point in a community.
http://en.wikipedia.org/wiki/Diffusion_of_innovations

People can fall into different categories for different innovations -- a farmer might be an early adopter mechanical innovations, but a late majority adopter of biological innovations or VCRs.
http://en.wikipedia.org/wiki/Everett_Rogers#Diffusion_of_Innovations

This is about people who actually adopt the technology. It blends out all those, who don't buy into a product.

So in conclusion, knowing the % of BD players in US households only tells us that, the % of BD players in US households. It doesn't tell us, according to the theory above, where we are on the Bell curve of product adoption. The assumption that we can use the % of BDP in US household to determine the current position of the formats life cycle would only be correct, if 100% of US households adopt the format.

If only 50% of households ever adopt BD, then after the format is finished the adoption would still look like the Bell curve and you would still find all of the groups in it. But only in 50% of US households overall. ;)

Lee Stewart
04-08-2009, 07:58 AM
HHs at the same time don't really figure into a formats establishment though. I can have 60% of the home video market with 10% household penetration.

You can make up any numbers you want (which you just did :lol:) but are they realistic? In your case - no.

The_Omega_Man
04-08-2009, 01:57 PM
HTDV = Early Adopter
HD DVD = Early Adopter
BD = Laggard (see previous)

MikeRox
04-09-2009, 02:09 AM
You can make up any numbers you want (which you just did :lol:) but are they realistic? In your case - no.

I was providing a possible example. 10% isn't realistic, but 20% is.

BobY
04-10-2009, 12:05 AM
All of your considerations are valid, and are concerns by the involved parties.

But public Blu-ray benchmarks made during the format war or before the recession are not the best judge of where Blu-ray progress should be.

True, but that wasn't my point. I was simply noting that for any of a number of reasons Blu-Ray sales have not met expectations, but regardless of whether the reasons are real or simply an excuse, it's still true. The studios had no reason to exaggerate their expectations (especially to their stockholders).

Last fall was planned year and years ago to be the mass market introduction for Blu-ray and great strides were made in it penetration into USA households. That will advance a lot more in upcoming months as future hardware sales accelerate.

I doubt it was planned years and years ago. Firstly there was no way to plan that far in the future with the uncertainty of the format war and secondly, the BDA flat out stated at CES in 2008 that they had to rush Blu-Ray to market before it was ready in order to counter HD DVD. I think few people would doubt if Blu-Ray had come out a year after HD DVD (albeit in it's finished form without the multiple profiles nonsense), that it would have died quickly against an already established HD format.

A lot of Blu-rat titles have sold 10000-50000 units but most have made money from a cost standpoint even at that low volume, the issues are making more money on catalog titles so that source restoration is profitable. But those released Blu-ray titles have a long shelf life and even if not sold immediately have a long sales tail and continue to accumulate sales. The primary concern is encouraging retailers to show more titles.

You have access to more numbers than I do. How does a studio make money off titles selling in the 10,000-30,000 range given the higher cost of authoring Blu-Ray and the higher cost of disc production (then add in costs for marketing, promotion, sales, distribution...)? What kind of profit are they making at that level of sales? If a title sells 10,000 copies at a retail price of $24, that's only $240,000 in gross sales (some of which goes to the retailer). Are you saying the studios can make a profit on that given all the cost adders above?

Do BD's really have a long sales tail at this point? The sales data suggests that new BD owners don't really purchase many older BD releases, presumably because they already bought the film on DVD before they had a BD player and don't want to double-dip. Have you seen any figures for the sales tail (like, say, after the first month of sales, how many discs are sold of a given title over the next 6-12 months)?

I know that they work and are a great paradigm, but what I meant was that if the 2.5% + 13.5% = 16% is the theory, that Blu-ray can be showing the indications of early majority consumer behavior at a slightly different benchmark.

It may show such "behavior", but that doesn't mean it has achieved such status, unless one presumes that the ultimate market size for BD will be significantlty smaller than for DVD.

Nikipol's analysis clarifies that the percentages in the OP are relative to whatever the ultimate market size ends up at (regardless of actual size), not total population. The reason I use total population (households) is that DVD has practically achieved penetration of the total population (90+% of US households). So it could be true that Blu-Ray is already well into the early majority phase if you presume it's ultimate market penetration will be less than DVD.

With Blu-ray there is the issue of how to count PS3s as hardware in household penetration. At any rate, by the end of this year, its likely that standalone and PS3 units will be enough to be over 16% of the $116 M or so USA households.

I agree, but I maintain that less than half of PS3's are being used as BD players on a regular basis. I know that's in direct opposition to all of the polls and such, but the proof is in the pudding and even smash-hit films like "TDK", "Iron Man", "Spiderman", "Transformers" and "300", which are squarely targeted at the PS3 demographic, sell in numbers that are less than half the PS3's out there (and a fair number of those discs sold are likely being sold to owners of standalone players).

So thats getting into early majority territory. If that number is close and there is rapid growth that is typically associated with that phase, then its say to say that Blu-ray is in that point of its mass market consumer lifecycle.

The problem I have with using anything other than hardware sales is, it really doesn't matter (from a market penetration viewpoint) how many discs you sell, or how good a growth rate of disc sales you have--the number of households with players is the key metric. Of course the studios only want to make money, so they are far more interested in how many discs are sold.

The same is true of the "market share" of BD sold versus DVD. The studios may like to see that market share increase, as it can mean more dollars for them, but if BD market share increases simply because DVD sales fell and not because BD sales increased, that means less dollars for the studios, not more.

We'll have to see what happens in 2009. I doesn't appear to me that Blu-Ray has achieved mass-market penetration by any objective criteria--neither players sales, nor disc sales would suggest that at this point, but there are still 8 months left...

BobY
04-10-2009, 12:28 AM
That assumes every household purchases exactly the same number of discs though. Wrong way of looking at it. I wouldn't be surprised if 20% of the DVD userbase bought 80% of the discs.

That's a reasonable point, however DEG says there was a total 1.4 Billion DVD's shipped in North America in 2008 and if 20% of North American households bought 80% of those, that means those households bought around 44 DVD's a year or 3.6 a month on average (OK, that's based on DVD's shipped, not sold, so we don't know the real number actually sold to consumers, but we also don't know how many DVD's people bought that were not shipped in 2008, but had just been sitting in the store).

Kosty
04-10-2009, 04:42 AM
I doubt it was planned years and years ago. Firstly there was no way to plan that far in the future with the uncertainty of the format war and secondly, the BDA flat out stated at CES in 2008 that they had to rush Blu-Ray to market before it was ready in order to counter HD DVD. I think few people would doubt if Blu-Ray had come out a year after HD DVD (albeit in it's finished form without the multiple profiles nonsense), that it would have died quickly against an already established HD format. It really was. Even before the format war started. It certainly was never expected to have Blu-ray ready for mass production in the fall of 2007, if anything HD DVD accelerated things. 4Q 2008 was always the very earliest expectation for more than niche Blu-ray sales. That was one of the motivations for HD DVD in that format couple be able to be scaled up a year or two sooner.

Kosty
04-10-2009, 04:57 AM
Originally Posted by Kosty
A lot of Blu-rat titles have sold 10000-50000 units but most have made money from a cost standpoint even at that low volume, the issues are making more money on catalog titles so that source restoration is profitable. But those released Blu-ray titles have a long shelf life and even if not sold immediately have a long sales tail and continue to accumulate sales. The primary concern is encouraging retailers to show more titles.
You have access to more numbers than I do. How does a studio make money off titles selling in the 10,000-30,000 range given the higher cost of authoring Blu-Ray and the higher cost of disc production (then add in costs for marketing, promotion, sales, distribution...)? What kind of profit are they making at that level of sales? If a title sells 10,000 copies at a retail price of $24, that's only $240,000 in gross sales (some of which goes to the retailer). Are you saying the studios can make a profit on that given all the cost adders above?

Do BD's really have a long sales tail at this point? The sales data suggests that new BD owners don't really purchase many older BD releases, presumably because they already bought the film on DVD before they had a BD player and don't want to double-dip. Have you seen any figures for the sales tail (like, say, after the first month of sales, how many discs are sold of a given title over the next 6-12 months)?

I stand by the above statement. The recent Warner disc on demand service had some Warner execs stating that the threshold for a decision to make a DVD was sales expectation of 10000 units.

All Blu-ray releases to date from the studios are projected to do that at this time. For a catalog title with a HD master and a port over of DVD extras the cost is much less than you think for authoring and pressing. Its a workflow thing at this point. Besides not every title would even need that as a better selling title covers a poor one.

They don't don't go bad so they now can be pressed in advance of demand. For a catalog title there is zero cost for advertising promotion and effectively for distribution as discs are dropped shipped to major logistical hubs. Heck 40% go to a few sites in the country to get into Wal-Marts logistical system.

As the Blu-ray hardware ownership base expands the Blu-ray sales keep coming for those titles. Its a very long tail and much different than DVD sales which die after 8 weeks. For many titles the Blu-ray versions now are selling 33% to 75% of what the DVD versions are selling weekly.

The issue is not the ones with good masters or those that would never merit a restoration of the source material. What exists will be used. The issue is what to do with those titles that may deserve to have a restoration and if the costs of sprucing up the masters would be worth it based on projected sales.

Have you seen any figures for the sales tail (like, say, after the first month of sales, how many discs are sold of a given title over the next 6-12 months)? Yes. 300 The Dark Knight Planet Earth Batman Begins all have very long tails and have now sold more over time than they did in the first month.

Most other catalog releases that had lower initial sales have also done much more over time as Blu-ray sales in general have increased.

For many titles that 30 day, or more commonly tracked 8 week initial sales window is now being beaten by the long tail sales. Blu-ray is much different than DVD in that regard.

Kosty
04-10-2009, 05:32 AM
Heres a sales chart I've been playing with for Blu-ray sales based on some reported Nielsen Videoscan unit data and the estimated to p20 sales I now create for each week.

2006 and 2007 were clearly Innovator sales

1Q -3Q 2008 were clearly First Adopter sales

4Q 2008 to now is clearly showing some signs of Early Majority behavior, and by the 4Q 2009 I think that it will be clear that is the stage we are in.


http://i43.tinypic.com/1264vte.jpg


http://www.referenceforbusiness.com/management/Or-Pr/Product-Life-Cycle-and-Industry-Life-Cycle.html

Kosty
04-10-2009, 05:48 AM
Do we have any Nielsen Videoscan or other source for weekly unit or revenue sales data for Blu-ray from 3/18/2007 to 12/30/2007 so I can fill in the gaps. Even weekly revenue would work as a primary source.

I have some stats on Blu-ray's 2007 total units and revenues but no charting on a weekly basis. Any thoughts?

BobY
04-12-2009, 01:21 PM
It really was. Even before the format war started. It certainly was never expected to have Blu-ray ready for mass production in the fall of 2007, if anything HD DVD accelerated things. 4Q 2008 was always the very earliest expectation for more than niche Blu-ray sales. That was one of the motivations for HD DVD in that format couple be able to be scaled up a year or two sooner.

So if I understand you correctly, you're saying all of the BDA talk from Q2 2006 through Q3 2008 was totally bluster and they never expected to make any money until Q4 2008?

Aren't their stockholders a little ticked since they basically lied to them? SONY lost Billions of dollars--is that what they were telling their stockholders and banks they were going to do?

kamspy
04-12-2009, 01:52 PM
So if I understand you correctly, you're saying all of the BDA talk from Q2 2006 through Q3 2008 was totally bluster and they never expected to make any money until Q4 2008?

Aren't their stockholders a little ticked since they basically lied to them? SONY lost Billions of dollars--is that what they were telling their stockholders and banks they were going to do?

One would assume that stockholders would know the risks of a new home video medium and have the patience for it to mature.

Every company lies (to an extent) to stockholders, and the stockholders know this and usually read between the lines.

DonnyDC
04-12-2009, 02:01 PM
So if I understand you correctly, you're saying all of the BDA talk from Q2 2006 through Q3 2008 was totally bluster and they never expected to make any money until Q4 2008?

Aren't their stockholders a little ticked since they basically lied to them? SONY lost Billions of dollars--is that what they were telling their stockholders and banks they were going to do?I dont think its a surprise. Just take a look at the Xbox 360 and PS3. Both have yet to turn a profit overall but you wont ever hear the companies say that in a press release.

BobY
04-12-2009, 02:23 PM
I stand by the above statement. The recent Warner disc on demand service had some Warner execs stating that the threshold for a decision to make a DVD was sales expectation of 10000 units.

With all due respect, what does disc on demand have to do with this? It's an entirely different business model. I'm not sure what the "worthwhile" threshold of DVD has to do with the "worthwhile" threshold for Blu-Ray. DVD is a mature technology that has already taken full advantage of economies of scale and has an enormous number of replicators competing for business. There have been numerous quotes from independent producers that Blu-Ray is decidedly more expensive to author, license and produce than DVD and this has prevented them from moving into Blu-Ray. Certainly that may not be as true for larger studios, as they can amortize some costs over larger volumes and more titles.

All Blu-ray releases to date from the studios are projected to do that at this time. For a catalog title with a HD master and a port over of DVD extras the cost is much less than you think for authoring and pressing. Its a workflow thing at this point. Besides not every title would even need that as a better selling title covers a poor one.

So you're basically talking about plain-vanilla releases--25GB, same extras as DVD (maybe in SD), no BD-Live--that have little more going for them over DVD than being HD. Is that the studios' plan for films that aren't major hits? Is that going to satisfy consumers enough to pay the premium?

They don't don't go bad so they now can be pressed in advance of demand. For a catalog title there is zero cost for advertising promotion and effectively for distribution as discs are dropped shipped to major logistical hubs. Heck 40% go to a few sites in the country to get into Wal-Marts logistical system.

They can always press in advance of demand, but that costs money now instead of later and when supplies exceed demand, it usually leads to price erosion, something that has hurt the DVD cash cow as of late.

As the Blu-ray hardware ownership base expands the Blu-ray sales keep coming for those titles. Its a very long tail and much different than DVD sales which die after 8 weeks. For many titles the Blu-ray versions now are selling 33% to 75% of what the DVD versions are selling weekly.

Do you have any specific figures? The last information I saw indicated new BD owners were not buying many older releases (presumably because they already owned the titles on DVD). Has this changed?

The issue is not the ones with good masters or those that would never merit a restoration of the source material. What exists will be used. The issue is what to do with those titles that may deserve to have a restoration and if the costs of sprucing up the masters would be worth it based on projected sales.

Agreed. Unfortunately they make up the bulk of films I'd be interested in owning :crying:. For the record, I never said BD wouldn't be successful, just that it would be a format of mostly new release, hit films because they would have a hard time making it worthwhile for anything else.

Yes. 300 The Dark Knight Planet Earth Batman Begins all have very long tails and have now sold more over time than they did in the first month.

So your saying "TDK" has sold over 6 Million copies on BD? "300" growing in sales wouldn't surprise me--it may have done "phenomenally" for an HD release at the time, but it only sold in the low hundreds of thousands in the first month of release--they had only sold 400K of both formats combined 3 months after release. "Batman Begins" had some pull from "TDK" as well.

Regardless, the question here isn't how well the blockbusters are doing--we know they are doing well--what does the average BD release do? What do the vast majority of BD releases do?

Most other catalog releases that had lower initial sales have also done much more over time as Blu-ray sales in general have increased.

Define "much more" ;)--for discs that only sold 6,000-7000 copies initially, selling 20,000 copies would be "much more".

For many titles that 30 day, or more commonly tracked 8 week initial sales window is now being beaten by the long tail sales. Blu-ray is much different than DVD in that regard.

That's to be expected. Everyone who was going to buy a DVD player bought one long ago and if they don't feel the need to buy a new DVD title as soon as it comes out, they will wait until the price drops significantly (or they won't buy it all). Blu-Ray is still in a growth phase and it seems logical when people buy a player they would interested in any titles that are out regardless of when they were released. In the past, though, the sales of older BD releases have not tracked the growing hardware base.

Given that my view of Blu-Ray is colored by the misinformation and propaganda that has been fed to the public over the past 2.5 years, it would be nice to see some real numbers, especially for the typical title and not simply a handful of cherry-picked examples...

BobY
04-12-2009, 02:29 PM
One would assume that stockholders would know the risks of a new home video medium and have the patience for it to mature.

Every company lies (to an extent) to stockholders, and the stockholders know this and usually read between the lines.

All investments are a risk. That doesn't, however, mean companies intentionally mislead their investors, saying they will do something when they know they can't. That's called "fraud".

Kosty
04-12-2009, 02:42 PM
Originally Posted by Kosty
It really was. Even before the format war started. It certainly was never expected to have Blu-ray ready for mass production in the fall of 2007, if anything HD DVD accelerated things. 4Q 2008 was always the very earliest expectation for more than niche Blu-ray sales. That was one of the motivations for HD DVD in that format couple be able to be scaled up a year or two sooner.

Originally Posted by BobY
So if I understand you correctly, you're saying all of the BDA talk from Q2 2006 through Q3 2008 was totally bluster and they never expected to make any money until Q4 2008?

Aren't their stockholders a little ticked since they basically lied to them? SONY lost Billions of dollars--is that what they were telling their stockholders and banks they were going to do?

I don't know. I'm pretty sure three years ago they were not saying that Blu-ray was going to be a billion dollar industry in 2006. But that was then and this is now. :D

Estimated Blu-ray unit sales since Oct 2006 through March 2009

(adjusted months within 3Q 2007 and 4Q 2007)

http://i41.tinypic.com/15gwenp.jpg

Same chart with the months of 3Q 2007 and 4Q 2007 adjusted to add 25% to the last month and subtract 25% from the first month of each quarter to more accurately reflect seasonal adjustments.

Kosty
04-12-2009, 02:44 PM
With all due respect, what does disc on demand have to do with this? It's an entirely different business model. I'm not sure what the "worthwhile" threshold of DVD has to do with the "worthwhile" threshold for Blu-Ray. DVD is a mature technology that has already taken full advantage of economies of scale and has an enormous number of replicators competing for business. There have been numerous quotes from independent producers that Blu-Ray is decidedly more expensive to author, license and produce than DVD and this has prevented them from moving into Blu-Ray. Certainly that may not be as true for larger studios, as they can amortize some costs over larger volumes and more titles. The quote was from the Warner executive who was saying that the threshold for economic DVD production and distribution was an estimated 10,000 unit sales and that is why some of the on demand titles never had reached DVD before.

Kosty
04-12-2009, 02:47 PM
So you're basically talking about plain-vanilla releases--25GB, same extras as DVD (maybe in SD), no BD-Live--that have little more going for them over DVD than being HD. Is that the studios' plan for films that aren't major hits? Is that going to satisfy consumers enough to pay the premium? Yep. Maybe as BD50s though with lossless audio and a port over of DVD extras.

Lots of 2nd tier titles will find their way to Blu-ray like that. But the audio and 1080p24 video on AVC or VC-1 will be an upgrade over the 480i MPEG-2 and 480 bit DD audio.
audio.

Kosty
04-12-2009, 02:48 PM
I'm not saying The Dark Knight has sold more on Blu-ray than it sold on DVD. That would be absurd.

Kosty
04-12-2009, 02:51 PM
Originally Posted by Kosty
As the Blu-ray hardware ownership base expands the Blu-ray sales keep coming for those titles. Its a very long tail and much different than DVD sales which die after 8 weeks. For many titles the Blu-ray versions now are selling 33% to 75% of what the DVD versions are selling weekly.
Do you have any specific figures? The last information I saw indicated new BD owners were not buying many older releases (presumably because they already owned the titles on DVD). Has this changed?
Yes. But its mostly that the DVD sales are so low after 8 weeks of release. But its starting to give retailers incentives to give more floor space for older Blu-ray titles and less space for older DVD releases.

Kosty
04-12-2009, 02:53 PM
Agreed. Unfortunately they make up the bulk of films I'd be interested in owning . For the record, I never said BD wouldn't be successful, just that it would be a format of mostly new release, hit films because they would have a hard time making it worthwhile for anything else. That was my real fear with Blu-ray that older titles would never get released. Now that is passed and its clear that eventually the viable 10000 -15000 theatrical titles will be released on Blu-ray, the only question is how much remastering the studios can afford on some of the classics where it would make a difference.

BobY
04-12-2009, 10:32 PM
I don't know. I'm pretty sure three years ago they were not saying that Blu-ray was going to be a billion dollar industry in 2006. But that was then and this is now. :D

They were saying that Blu-Ray would already be outselling DVD by last year. Unless they were assuming that DVD was going to crash and burn big time, I presume that means they thought BD be selling in the Billions of Dollars. They expected over a Billion in sales in 2008...

BobY
04-12-2009, 10:36 PM
The quote was from the Warner executive who was saying that the threshold for economic DVD production and distribution was an estimated 10,000 unit sales and that is why some of the on demand titles never had reached DVD before.

Hard to believe they couldn't push at least 10,000 copies of anything through their pipeline, but regardless, they were talking about DVD production and distribution, not BD. I don't believe the thresholds are the same.

BobY
04-12-2009, 10:41 PM
Yep. Maybe as BD50s though with lossless audio and a port over of DVD extras.

Lots of 2nd tier titles will find their way to Blu-ray like that. But the audio and 1080p24 video on AVC or VC-1 will be an upgrade over the 480i MPEG-2 and 480 bit DD audio.
audio.

But the question remains, will that approach motivate consumers to pay the premium to upgrade? Anecdotal evidence and some polls suggest that even people who own Blu-Ray players continue to buy DVD's of many films because they don't think those films are worth a premium price, or because they need to be able to play those films on DVD players they have in strategic locations such as their car or kid's room.

BobY
04-12-2009, 10:56 PM
I'm not saying The Dark Knight has sold more on Blu-ray than it sold on DVD. That would be absurd.

It looks like "TDK" sold about 2 Million copies on BD the first month (worldwide) and had hit nearly 3 Million copies by 8 weeks (the usual reference point used for DVD). If it's tail is as strong as you say, shouldn't it have sold 6 Million copies by now (at 17 weeks)?

BobY
04-12-2009, 11:01 PM
Yes. But its mostly that the DVD sales are so low after 8 weeks of release. But its starting to give retailers incentives to give more floor space for older Blu-ray titles and less space for older DVD releases.

Agreed. They will stock what is more likely to sell and as long as Blu-Ray is growing, they are more likely to sell older BD releases than older DVD releases.

BobY
04-12-2009, 11:06 PM
That was my real fear with Blu-ray that older titles would never get released. Now that is passed and its clear that eventually the viable 10000 -15000 theatrical titles will be released on Blu-ray, the only question is how much remastering the studios can afford on some of the classics where it would make a difference.

Given the release rate of BD titles continues to be less than the release rate of DVD titles in the same period of life, I wouldn't consider the fear being passed, but that's strictly a matter of one's personal comfort level. I still think it doesn't bode well for catalog films with limited appeal.

Kosty
04-13-2009, 05:42 AM
They were saying that Blu-Ray would already be outselling DVD by last year. Unless they were assuming that DVD was going to crash and burn big time, I presume that means they thought BD be selling in the Billions of Dollars. They expected over a Billion in sales in 2008... Show me one link to a story where anyone said that. Noone did. Ever.

I don't think even any bloggers or prominent posters on these sites did.

Come on. Show me just one trade article, Blu-ray company spokesmen or industry pundit who said that. Just one. :D

Kosty
04-13-2009, 05:46 AM
Hard to believe they couldn't push at least 10,000 copies of anything through their pipeline, but regardless, they were talking about DVD production and distribution, not BD. I don't believe the thresholds are the same.

Actually for Blu-ray its less. :)

The assumption for DVD is most sales would be earned initially , within 8 weeks or they never would be gained. For Blu-ray there is a working assumption that as the market is dramatically growing , viable sales can be made for years and that more retailers will eventually stock more inventory so any production decisions are less of a risk.

Kosty
04-13-2009, 05:50 AM
But the question remains, will that approach motivate consumers to pay the premium to upgrade? Anecdotal evidence and some polls suggest that even people who own Blu-Ray players continue to buy DVD's of many films because they don't think those films are worth a premium price, or because they need to be able to play those films on DVD players they have in strategic locations such as their car or kid's room.


Thats what Disney is addressing with their digital copies and included DVDs. Its a price issue as well. If the Blu-ray version is within $5 of the DVD version then Blu-ray owners seem to have a strong tendency to go Blu.

As Blu-ray players get cheaper putting $99 players in those back rooms will also be an option.

DVD sales are pretty dead for any specific title, so there is less fear of killing of older titles DVD sales as DVD catalog sales in general have been falling dramatically by themselves the last couple years.

As prices fall for Blu-ray those issues fall away.

Kosty
04-13-2009, 05:54 AM
It looks like "TDK" sold about 2 Million copies on BD the first month (worldwide) and had hit nearly 3 Million copies by 8 weeks (the usual reference point used for DVD). If it's tail is as strong as you say, shouldn't it have sold 6 Million copies by now (at 17 weeks)?


No because thats a huge attach rate to the existing size of the user base. Most Blu-ray owners own a copy and for those that do not they rented it or are busy watching other stuff and forget about it until they wander buy and see it on retail display.

But over 30-50% of ongoing current sales for the title are the Blu-ray version week after week and its probable that over 500,000 additional units have been sold past week 8.

Kosty
04-13-2009, 05:58 AM
Given the release rate of BD titles continues to be less than the release rate of DVD titles in the same period of life, I wouldn't consider the fear being passed, but that's strictly a matter of one's personal comfort level. I still think it doesn't bode well for catalog films with limited appeal.

I care and would prefer that the older classics sell enough so that restoration is justified but as of now preservation for the future is a motivation as well for the studios and an HD master can be used for other things than Blu-ray in the future.

I hope that they sell better to justify more resources being thrown the way of those older titles.

But even if they don't sell a lot, personally as long as a Blu-ray version exists and I can find it at Amazon or rent it from Netflix. that works for me just fine.

But at least port over the DVD extras please. :)

Kosty
04-13-2009, 05:59 AM
Agreed. They will stock what is more likely to sell and as long as Blu-Ray is growing, they are more likely to sell older BD releases than older DVD releases.

I think its very likely that we will see this trend accelerate in the next couple months and it will be very clear by this fall that target Best Buy and Wal-Mart will have greatly expanded their Blu-ray sections.

PFC5
04-13-2009, 10:19 AM
Show me one link to a story where anyone said that. Noone did. Ever.

I don't think even any bloggers or prominent posters on these sites did.

Come on. Show me just one trade article, Blu-ray company spokesmen or industry pundit who said that. Just one. :D

Sony DID say that BD would replace SD DVD within 3 years. Now that would not put it happening by last year, but come 6/2009 that would be the 3 year mark.

Sorry I just had to mention this as you likely remember this statement by Sony I am sure. I cannot look for the link of the quote until after 4/15 myself but I am sure you probably remember this.

Lee Stewart
04-13-2009, 10:57 AM
Sony DID say that BD would replace SD DVD within 3 years. Now that would not put it happening by last year, but come 6/2009 that would be the 3 year mark.

Sorry I just had to mention this as you likely remember this statement by Sony I am sure. I cannot look for the link of the quote until after 4/15 myself but I am sure you probably remember this.

Blu-ray will replace DVD within three years?

15 March 2007 8:27 by James "Dela" Delahunty | 37 comments

The Blu-ray Disc Association (BDA) has made a bold claim at CeBIT this year. The consortium behind the Blu-ray Disc format, expect the 25GB-per-layer optical medium to actually replace the current DVD technology within three years. "Within three years it will just be Blu-ray," Frank Simonis, the Blu-ray Disc Association European chairman said at CeBIT, the world's biggest technology trade show.

Having already declared its own victory over its rival, HD DVD, Blu-ray has gone on to outsell HD DVD in the United States where the PlayStation 3 (PS3) console is available. This has led to speculation of further price cuts from the HD DVD camp, in an effort to curb the initial buzz that Blu-ray receives from PS3 owners who are completely new to HD.

However, replacing HD DVD fast could be possible if Blu-ray sorts out its prices and keeps the PS3 console selling strong, but even three whole years is a very short time to hope to replace DVD. DVD is a huge success story in the industry as a medium to sell movies (DVD-Video) and to sell games (PS2, Xbox, PC) and software (DVD-ROM). It has also become a major success for consumers who use the format for data storage, for home movies, in DVD recorders etc.

A double-layer DVD holds about 8.5GB of data and with price cuts for DVD-R/+R DL discs and the emergence of cheaper hardware to record even HD broadcasts to the media, BOC expects double layer disc sales to double this year alone. Of course, blue laser discs will replace red laser-based media eventually, that is the direction the industry is going, but within three years is not that likely.

Source:
Reuters

http://www.afterdawn.com/news/archive/8983.cfm


Blu-ray: We'll Replace DVD in Three Years

Blu-ray is aiming to replace the DVD format within three years, and is practically claiming victory at the CeBIT technology show in Germany.

The European chairman of the Blu-ray Disc Association says that by the end of that period, Blu-ray would be the only next-generation format left. It pointed to the launch of the PlayStation 3 as a major impetus for the format's eventual supremacy.

http://www.betanews.com/article/Bluray-Well-Replace-DVD-in-Three-Years/1174066039

PFC5
04-13-2009, 11:01 AM
Thanks for the link Lee. I can always count on you to have such archive links readily available. :thumbsup:

Lee Stewart
04-13-2009, 11:03 AM
Thanks for the link Lee. I can always count on you to have such archive links readily available. :thumbsup:

:hithere:

:lol:

Kosty
04-13-2009, 11:56 AM
"Within three years it will just be Blu-ray," Frank Simonis, the Blu-ray Disc Association European chairman said at CeBIT, the world's biggest technology trade show.

I think it was the afterglow of holiday season or the schnapps talking. :D

Having already declared its own victory over its rival, HD DVD, It took another year to kill off HD DVD. Don't know if I commented on that at the time , but I would not have given either format 3 years from then to do as much as Blu-ray has already achieved to this point.

Mid format war propaganda PR speak from the BDA. Before the current economic situation.

Thanks for the linky.


Originally Posted by BobY
They were saying that Blu-Ray would already be outselling DVD by last year. Unless they were assuming that DVD was going to crash and burn big time, I presume that means they thought BD be selling in the Billions of Dollars. They expected over a Billion in sales in 2008.. Still don't see anyone, let alone a Sony rep say 2008. Even that quote from the European BDA guy says 2010.... :)
Originally Posted by Kosty
Show me one link to a story where anyone said that. Noone did. Ever.

I don't think even any bloggers or prominent posters on these sites did.

Come on. Show me just one trade article, Blu-ray company spokesmen or industry pundit who said that. Just one. My challenge still stands. :D

DonnyDC
04-13-2009, 12:06 PM
Still don't see anyone, let alone a Sony rep say 2008. Even that quote from the European BDA guy says 2010.... :)March 2010 here we go!!

Now to avoid confusion what do we think the BDA guy means by 'replace.' Id say he meant replace DVD as the main revenue stream so over 50% of packaged media.
I dont think it'll happen but who knows...

Kosty
04-13-2009, 03:44 PM
Blu-ray is aiming to replace the DVD format within three years, and is practically claiming victory at the CeBIT technology show in Germany.

The European chairman of the Blu-ray Disc Association says that by the end of that period, Blu-ray would be the only next-generation format left. It pointed to the launch of the PlayStation 3 as a major impetus for the format's eventual supremacy.

To be even fairer, it really seems he meant that by that time Blu-ray would be the only high definition optical disc format on the market and HD DVD would be dead at that time.

Since HD DVD died in Feb 2008, he was indeed prescient.....only much too conservative to predict that by March 2010 that HD DVD would be dead. :)

PFC5
04-14-2009, 12:37 AM
I think if he meant HD DVD would be dead within 3 years he would have said "HD DVD, and not "DVD".

I think they were completely overreaching and made a completely unrealistic prediction myself. ;)

MikeRox
04-14-2009, 05:42 AM
I think they were banking on the PS3 instantly becoming the market leader world wide etc. They also won't have factored in any form of bad economic climate etc getting in the way.

It was always completely unrealistic that Blu-ray could ever replace DVD within 3 years. I think DVD will "linger" for a good 5 years yet.

Kosty
04-14-2009, 07:47 AM
I think if he meant HD DVD would be dead within 3 years he would have said "HD DVD, and not "DVD".

I think they were completely overreaching and made a completely unrealistic prediction myself. ;)Blu-ray is aiming to replace the DVD format within three years, and is practically claiming victory at the CeBIT technology show in Germany.

The European chairman of the Blu-ray Disc Association says that by the end of that period, Blu-ray would be the only next-generation format left. It pointed to the launch of the PlayStation 3 as a major impetus for the format's eventual supremacy. Thats the only reason I said that what he meant was Blu-ray would be the winner of the high definition optical disc format war.

But a lot of silly things were said a few years ago, especially right after the launch of the PS3.

No matter now, HD DVD is dead and right now Blu-ray is making some significant progress against DVD and Blu-ray at least has ensured its survival. That by itself was a a bit unknown a couple years ago.