September 19, 2008
CEDIA EXPO Blu-ray Disc Association

By Gary Reber

The Blu-ray Disc Association hosted an informal get together with studio and company member executives during the CEDIA EXPO.

What follows are the opening remarks of Andy Parsons, Chairman of the U.S. Promotion Committee for the Blu-ray Disc Association.

<blockquote>“Good afternoon everyone, and welcome to the Blu-ray Disc Association’s CEDIA luncheon. My name is Andy Parsons, and I serve as the chair of the U.S. Promotion Committee for the Blu-ray Disc Association. My day job is Senior Vice President of advanced product development for Pioneer Electronics USA. 

"We are excited to have some distinguished guests today from some very important Blu-ray member companies, and I’d first like to introduce them to you. We have Bob Chapek, President of Walt Disney Studios Home Entertainment Worldwide. We also have Mike Dunn, President Worldwide of Twentieth Century Fox Home Entertainment;  David Bishop, President, Sony Pictures Home Entertainment Worldwide;  Craig Kornblau, President, Universal Pictures Home Entertainment;  Randy Waynick, Senior Vice President, Marketing, Home Products Division of Sony Electronics;  Chris Fawcett, Vice President, Marketing, Home Products Division of Sony Electronics; and Marty Gordon, Vice President, Business Development, Philips Electronics. All of these gentlemen, and myself, will be pleased to talk with you one-on-one  immediately following my opening remarks. I encourage you to take advantage of this informal setting to chat with us about general Blu-ray format questions you may have, as well as our individual company products and initiatives. 

"Before we break for that, I would like to begin with a very quick “state of the union” update for the BD format. We have some new statistics today that illustrate how the Blu-ray format is really taking off with consumers, retailers and custom installers. 

"As we’ve always said, the driving forces behind the adoption of Blu-ray Disc are the increasing penetration of high-definition TV displays and the availability of high quality content to enjoy on them. Blu-ray Discs also take advantage of the attributes of DVD that consumers love so much: the durable, convenient disc that we can easily hold in our hand, pop into a player, and then put on a shelf until the next time we want to use it. This reassuring familiarity is why we believe that consumers instinctively “get” Blu-ray Disc as a consumer technology, and so far, their buying habits are proving this. Consider these software sales numbers from Home Media Magazine, compiled by The Red Hill Group:

"If we have not achieved it as of today, we should very soon hit 15 million Blu-ray Disc titles sold in the United States market alone since the format first launched in mid-2006. 

"In all of 2007, 5.6 million discs were sold in the U.S. So far in 2008, more than 8.8 million discs have been sold, a 57 percent increase in only two-third the time. 

"Looking at this number in a different way, we are currently selling 4.5 times as many Blu-ray discs per month than we were in the same months last year.
According to Adams Media Research, fully 60 percent of all software sales occur within the fourth quarter of the year, meaning that 2008 is shaping up to be a very strong year for Blu-ray content sales. 

"By the way, there should be no doubt that packaged media will continue to represent the vast majority of the home entertainment content market, even as the new Internet distribution models begin to grow in the coming years. In fact, a very recent report from Global Media Intelligence, a collaboration with Screen Digest incorporating Adams Media Research, estimates that by 2011, all forms of electronic distribution, including download-to-own, video-on-demand and advertising-supported models, will only amount to just a bit over 5 percent of all theatrical and home video revenue. They predict that household bandwidth limitations will limit the practical appeal of Internet-distributed media, and that consumers will continue to naturally prefer the physical, tangible medium that Blu-ray Disc represents. Again, consumers seem to clearly understand the value of packaged media, perhaps better than the pundits who have made sensational predictions that it’s too late for Blu-ray, that Internet downloads will obliterate the format. I'm fond of recalling the old visions of the past that the “paperless office” would also completely obliterate the need for paper––remember?––a very reasonable, logical prediction from decades ago that turned out to be completely wrong. We’ve said it before, and I’ll say it again today: Blu-ray Disc will successfully coexist with, and be preferred to, new digital download distribution models that will slowly grow in popularity, much as DVD has happily coexisted with, and consistently outpaced, video-on-demand.

"GMI also tells us that the adoption rate of standalone Blu-ray players is a bit behind where DVD players were at this point after launch…but that’s before we take PS3 into account. Considering that a very significant number of PS3 owners use their consoles to watch Blu-ray titles on a regular basis, GMI believes that the adoption rate for Blu-ray devices is actually tracking way ahead of where DVD was at this point in its life.

"As of today, more than 6.5 million Blu-ray capable players, including PS3, have been sold in the U.S. The number for Europe is more than 5.5 million, and it’s more than 15 million units sold worldwide. Of course not everyone plays BD movies on their PS3, but when we look at the software numbers I’ve already covered, it’s clear that a huge number of them are. 

"In short, the demand for Blu-ray Disc products is extremely healthy. After the format war ended in February, a sudden, strong consumer demand created a temporary shortage of popular player models from which  many of our CE member companies have only just recently recovered. Today we can find players available for sale that range in street price from under $300 to more than $2,000. If history has taught us anything, we can expect competition and increased volumes to create the same, relentless downward price pressure that allowed DVD players to become so amazingly affordable. 

"Taking all of this into account, we in the BDA are very bullish on the fourth quarter prospects for the format, and expect this holiday season to be the brightest ever for Blu-ray Disc. 

"Now I’d like to invite you to enjoy the opportunity to chat with some of the most influential people in this business, and once again, on behalf of the Blu-ray Disc Association, thank you very much for coming today."</blockquote>

I spoke separately with the individual studio executives and asked each the same two questions: What is your policy on producing titles with 7.1 discrete channel soundtracks? What plans do you have for rich BD-Live™ content on a per title basis?

The answers were reassuring and universal. As for 7.1-channel production they said that was their goal to produce as many titles as possible in the new surround format. As for producing more BD-Live, that too was their goal.

Their response is indeed encouraging. Both features are unique to the Blu-ray Disc format with no competition from other content delivery sources. It is logical that the studios will be increasingly embracing discrete 7.1-channel soundtracks and interactivity via the Internet connection.

I also asked the Sony representatives what the future was for using the Blu-ray Disc format delivery of Dolby TrueHD and DTS-HD Master Audio for surround music. They acknowledge that this is the direction they are pursuing.

Gary Reber
Editor-In-Chief & Publisher
Widescreen Review

Tags: - editor's couch - - CEDIA - - Blu-ray - - Sony - - Disney - - Warner - - Paramount - - Universal - - Pioneer - - Dolby - - TrueHD - - DTS - - DTS-HD - - BD-Live - - 7.1 -