( Leon Neal/The Times)
Blu-ray high definition DVDs
Mike Harvey at the Consumer Electronics Show in Las Vegas
Time is running out for Blu-ray discs, the high definition (HD) format that are supposed to be replacing the DVD.
Despite the launch of new Blu-ray players and talk of rising sales at the Consumer Electronics Show in Las Vegas, manufacturers know they are in a race to make a real impact on the market before the new kid on the block, downloading or streaming HD films directly from the internet, consigns the format to a footnote in video history.
Blu-ray discs have the same physical dimensions as a DVD, but provide better quality sound and pictures for HD movies, thanks to more expensive laser technology. They were launched nearly three years ago but only became the preferred medium after winning an HD format war a year ago.
Blu-ray has just had an impressive year of growth. Consumers are looking to take advantage of the rise of HD TV programming by broadcasters before the coming switch to digital TV and in the US they are buying more HD TV sets than standard definition sets.
At the Blu-ray Disc Association press conference at CES, chairman Andy Powers listed the US Blu-ray statistics: with more than 1,100 movie titles now available, 24.09 million discs were sold in 2008 compared to 5.67 million in 2007.
The Dark Knight batman movie was the standard bearer for the format, becoming the first million-plus seller on Blu-ray in America.
Sales of Blu-ray players are also climbing fast, helped by huge Christmas discounts in America which saw the cost of players drop below $200. Eight per cent of US household are now estimated to have Blu-ray hardware, including Sony's Playstation 3 consoles which can play the discs.
But the problem for Blu-ray is that these figures still mean that Blu-ray is a high-end niche product, bought mainly by early adopters who can afford to pay the higher prices of the discs and the players - still about three times the price of a DVD player.
Sales of DVDs are not being dented by sales of Blu-ray discs. In the UK, figures from the British Video Association reveal that the number of DVDs sold last year actually rose slightly by 1.9 per cent to 252.9 million at an average price of £8.97. There were only 3.75 million Blu-ray discs sold in the year at an average price of £19.29. The top-selling DVD Mamma Mia! The Movie shifted more than 5 million copies in just five weeks while Dark Knight sold only about 300,000 copies on Blu-ray.
Differentiation viewed as the single biggest problem for Blu-ray. People like DVDs and do not see Blu-ray as sufficiently better to make the jump to the new format. This is understandable. The leap from VHS to DVD was huge compared to the more subtle improvement in viewing experience offered by Blu-ray over DVD. What's more, consumers have been confused by the HD format war - many say they are still holding out for the battle to be settled - and others wrongly believe that you cannot play DVDs on a Blu-ray player. The switch has been further confused by the emergence of "upconverter" DVD players which improve the picture quality of ordinary DVDs to near HD quality.
Rob Enderle, principal analyst with the Enderle Group, a leading technology advisory company in the US, said that only after watching an upconverted DVD and a Blu-ray disc one after another could most people tell the difference. "Blu-ray is going to play a transition 'between' role - it can sustain the high end of the market but as soon as the flip comes to downloads or streaming - and I think that will be in the next couple of years - then it will not make any further progress. I am not convinced Blu-ray will ever go mainstream," he said. He fully expected Blu-ray to be the last physical movie format before digital downloading became the norm, he said.
Certainly there was more "noise" among the hundreds of thousands of attendees and exhibitors at CES about downloading and streaming TV programmes and movies than about Blu-ray. One of the biggest themes at the showcase of cutting edge consumer gadgets was how the big TV manufacturers like Samsung, Sony, Panasonic and others have signed up to a new system of widgets which allow users to access internet content including YouTube directly from their television sets. Steve Ballmer, CEO of Microsoft, declared in his keynote speech that the border between TV and the internet was being dissolved.
As people get more comfortable with the idea of connecting their web experience and the TV, streaming TV programmes and movies onto the bigger screen rather than the laptop will become the norm, analysts say. The new wave of digital media services starting to flow into the living room was exemplified by the launch at CES of a new line of HD televisions from the Korean television maker LG Electronics that connect directly to the Internet with no set-top box required. The televisions will be able to play movies and television shows from online video-on-demand services, including Netflix.
Apple's online iTunes Store introduced high-definition movies a year ago and already has 600 titles available to rent or download. A similar Internet-connected box, Vudu, can access about 1,400 high-definition films. While both services remain niche products, supporters say the convenience of streaming and the rising acceptability of watching video content on the big screen will quickly force this into the mainstream. In the UK thanks to services such as BBC iPlayer and YouTube, Gartner, the technology analysts, predict that almost 20 million people will be subscribing to internet TV platforms by the end of this year, a rise of 64 per cent in 12 months.
The biggest obstacle to the wide adoption to video streaming, especially in the UK, is the lack of high-speed broadband in many homes. Millions of internet customers are getting less than half the broadband speed they are paying for, restricting their ability to download music, film and games, according to a report this week from Ofcom, the telecoms regulator. Slow internet speeds can cause streaming images to judder to a halt and make watching HD films unthinkable. It takes about eight hours to download HD-quality films over a normal internet connection of about two megabits (Mb) per second.
The recession, perversely, may be about to provide a solution to this - and hit the growth of Blu-ray twice over. Analysts expect that the lack of consumer spending power will hit sales of Blu-ray discs and players, despite the tumbling prices. The economic woes come at a crucial time for Blu-ray, three years after launch. DVD really took off after its launch in years four, five and six.
Spending on high-speed broadband infrastructure, making streaming of movies faster and much more inviting, is likely to be the second indirect consequence of the recession. Providing high-speed broadband for every American home is set to become one of the main planks in Barack Obama's economic rescue plan in the US. In the UK Gordon Brown has also talked about upgrading the country's ageing copper wire network and BT has proposed investing £1.5 billion in a fibre-optic network to give 10 million households, or 40 per cent of the population, speeds of 40Mb to 60Mb by 2012.
Not that the Blu-ray backers are going to give up without a fight. The big manufacturers and studios have invested billions on the format.
They point out that a new feature of Blu-ray called BD Live (Blu-ray Disc Live), which lets people download additional material from the Internet and interact with friends in text chats that appear on the television while playing a movie, makes the format more attractive.
Many of the new Blu-ray players launched at CES have this internet access built in.
But perhaps the one thing that might just rescue Blu-ray in its make-or-break year is the preference of human beings to own things they can handle. For many people, having a movie in a physical format will always be more preferable than having it on the hard drive in the computer.
Mr Powers, chairman of the Blu-ray Disc Association, said: "If you are going to own something, there is nothing better than a disc, what I call content real estate. I can put my Blu-ray disc on a shelf and watch it later. You can't do that with a download.
Despite the launch of new Blu-ray players and talk of rising sales at the Consumer Electronics Show in Las Vegas, manufacturers know they are in a race to make a real impact on the market before the new kid on the block, downloading or streaming HD films directly from the internet, consigns the format to a footnote in video history.
Blu-ray discs have the same physical dimensions as a DVD, but provide better quality sound and pictures for HD movies, thanks to more expensive laser technology. They were launched nearly three years ago but only became the preferred medium after winning an HD format war a year ago.
Blu-ray has just had an impressive year of growth. Consumers are looking to take advantage of the rise of HD TV programming by broadcasters before the coming switch to digital TV and in the US they are buying more HD TV sets than standard definition sets.
At the Blu-ray Disc Association press conference at CES, chairman Andy Powers listed the US Blu-ray statistics: with more than 1,100 movie titles now available, 24.09 million discs were sold in 2008 compared to 5.67 million in 2007.
The Dark Knight batman movie was the standard bearer for the format, becoming the first million-plus seller on Blu-ray in America.
Sales of Blu-ray players are also climbing fast, helped by huge Christmas discounts in America which saw the cost of players drop below $200. Eight per cent of US household are now estimated to have Blu-ray hardware, including Sony's Playstation 3 consoles which can play the discs.
But the problem for Blu-ray is that these figures still mean that Blu-ray is a high-end niche product, bought mainly by early adopters who can afford to pay the higher prices of the discs and the players - still about three times the price of a DVD player.
Sales of DVDs are not being dented by sales of Blu-ray discs. In the UK, figures from the British Video Association reveal that the number of DVDs sold last year actually rose slightly by 1.9 per cent to 252.9 million at an average price of £8.97. There were only 3.75 million Blu-ray discs sold in the year at an average price of £19.29. The top-selling DVD Mamma Mia! The Movie shifted more than 5 million copies in just five weeks while Dark Knight sold only about 300,000 copies on Blu-ray.
Differentiation viewed as the single biggest problem for Blu-ray. People like DVDs and do not see Blu-ray as sufficiently better to make the jump to the new format. This is understandable. The leap from VHS to DVD was huge compared to the more subtle improvement in viewing experience offered by Blu-ray over DVD. What's more, consumers have been confused by the HD format war - many say they are still holding out for the battle to be settled - and others wrongly believe that you cannot play DVDs on a Blu-ray player. The switch has been further confused by the emergence of "upconverter" DVD players which improve the picture quality of ordinary DVDs to near HD quality.
Rob Enderle, principal analyst with the Enderle Group, a leading technology advisory company in the US, said that only after watching an upconverted DVD and a Blu-ray disc one after another could most people tell the difference. "Blu-ray is going to play a transition 'between' role - it can sustain the high end of the market but as soon as the flip comes to downloads or streaming - and I think that will be in the next couple of years - then it will not make any further progress. I am not convinced Blu-ray will ever go mainstream," he said. He fully expected Blu-ray to be the last physical movie format before digital downloading became the norm, he said.
Certainly there was more "noise" among the hundreds of thousands of attendees and exhibitors at CES about downloading and streaming TV programmes and movies than about Blu-ray. One of the biggest themes at the showcase of cutting edge consumer gadgets was how the big TV manufacturers like Samsung, Sony, Panasonic and others have signed up to a new system of widgets which allow users to access internet content including YouTube directly from their television sets. Steve Ballmer, CEO of Microsoft, declared in his keynote speech that the border between TV and the internet was being dissolved.
As people get more comfortable with the idea of connecting their web experience and the TV, streaming TV programmes and movies onto the bigger screen rather than the laptop will become the norm, analysts say. The new wave of digital media services starting to flow into the living room was exemplified by the launch at CES of a new line of HD televisions from the Korean television maker LG Electronics that connect directly to the Internet with no set-top box required. The televisions will be able to play movies and television shows from online video-on-demand services, including Netflix.
Apple's online iTunes Store introduced high-definition movies a year ago and already has 600 titles available to rent or download. A similar Internet-connected box, Vudu, can access about 1,400 high-definition films. While both services remain niche products, supporters say the convenience of streaming and the rising acceptability of watching video content on the big screen will quickly force this into the mainstream. In the UK thanks to services such as BBC iPlayer and YouTube, Gartner, the technology analysts, predict that almost 20 million people will be subscribing to internet TV platforms by the end of this year, a rise of 64 per cent in 12 months.
The biggest obstacle to the wide adoption to video streaming, especially in the UK, is the lack of high-speed broadband in many homes. Millions of internet customers are getting less than half the broadband speed they are paying for, restricting their ability to download music, film and games, according to a report this week from Ofcom, the telecoms regulator. Slow internet speeds can cause streaming images to judder to a halt and make watching HD films unthinkable. It takes about eight hours to download HD-quality films over a normal internet connection of about two megabits (Mb) per second.
The recession, perversely, may be about to provide a solution to this - and hit the growth of Blu-ray twice over. Analysts expect that the lack of consumer spending power will hit sales of Blu-ray discs and players, despite the tumbling prices. The economic woes come at a crucial time for Blu-ray, three years after launch. DVD really took off after its launch in years four, five and six.
Spending on high-speed broadband infrastructure, making streaming of movies faster and much more inviting, is likely to be the second indirect consequence of the recession. Providing high-speed broadband for every American home is set to become one of the main planks in Barack Obama's economic rescue plan in the US. In the UK Gordon Brown has also talked about upgrading the country's ageing copper wire network and BT has proposed investing £1.5 billion in a fibre-optic network to give 10 million households, or 40 per cent of the population, speeds of 40Mb to 60Mb by 2012.
Not that the Blu-ray backers are going to give up without a fight. The big manufacturers and studios have invested billions on the format.
They point out that a new feature of Blu-ray called BD Live (Blu-ray Disc Live), which lets people download additional material from the Internet and interact with friends in text chats that appear on the television while playing a movie, makes the format more attractive.
Many of the new Blu-ray players launched at CES have this internet access built in.
But perhaps the one thing that might just rescue Blu-ray in its make-or-break year is the preference of human beings to own things they can handle. For many people, having a movie in a physical format will always be more preferable than having it on the hard drive in the computer.
Mr Powers, chairman of the Blu-ray Disc Association, said: "If you are going to own something, there is nothing better than a disc, what I call content real estate. I can put my Blu-ray disc on a shelf and watch it later. You can't do that with a download.