Some people -- mainly those on the red side, but some on the Blu as well -- seem to feel that this is the only issue in this format "war," or at least the main one that will end up mattering. Personally, I just don't see how this is the case. If the goal is to get a Blu-ray player into the home of everyone in the world in 2007, then yes, substantially lowering the player prices would be a necessity. But manufacturers are looking at the situation long-term, and their instincts have proven right thus far.
No new media format has EVER fallen in price as fast as HD DVD has. There are many reasons why... the main one being that R&D costs don't recoup themselves within the first six months of a new product. Massive price cuts like Toshiba has done are the tactics of the desperate... not of the successful. If Toshiba had any other major manufacturers on board making HD DVD players they quite simply couldn't lower prices as quickly as they have (for no other manufacturer would be willing to take the financial "hit" Toshiba is), and by cutting their margins down to nothing (or selling at a loss) they are essentially guaranteeing that no other major manufacturer will join their camp.
The BDA has MANY manufacturers producing players, and if one member started selling players below cost, many other manufacturers would likely jump ship overnight. The manufacturers are all doing a fantastic job at lowering component and prodcution costs as each generation passes, but releasing below-cost players would kill other companies, and set consumer expectations so that others might never be able to profit from player sales.
You can already see this with Toshiba. There is already a feeling that spending more than $100 on an HD DVD player is just dumb for the consumer, and for a store to charge more than $200 for a player is highway robbery. And of course, you'd better get a half dozen or more free movies in the deal. Why in the world would ANY other company want to make these things given the non-existant profit potential at those prices. HD DVD is no longer fighting to become the next generation replacement for DVD... it is fighting just to keep the competition from doing the same. Toshiba is earning far too much from regular DVD to let BD replace it, and they're going to insane lengths to prevent that from happening.
The position the BDA is in affords them the ability to proceed with an eye on the end-game. This isn't "make it or break it" time for BD as it is for HD DVD. BD has, for all intents and purposes, already made it. There are approximately 6 million PS3's in people's homes worldwide. Now, at this point, only a minority of those are actually being used to watch BD movies on, but as time goes on, that will certainly change. And, as PS3 sales grow, the potential market for HD DVD continues to shrink. After all, whether someone uses their PS3 for BD movies or not, there's virtually no chance of them completely foregoing the BD movie capabilities of the PS3 and then going out and buying an HD DVD player. It would make NO sense to do so.
As it stands, no matter what Toshiba does with their player pricing, Blu-ray standalones sell just about the same as HD DVD standalones, though the cost of the cheapest models are substantially higher for Blu-ray. And, of course, that's only in the U.S. -- worldwide Blu-ray player sales far exceed HD DVD player sales. Likewise, Blu-ray recorders, Blu-ray PC drives, Blu-ray camcorders, and, oh yeah the PS3, FAR outsell there HD DVD counterparts (where such counterparts even exist).
Again, Blu-ray is setting itself up to be the next (and possibly last) major optical disc format. It's uses go far beyond movie playback already. That's not a promise of recorders and other uses scheduled for some time in the distant future as with HD DVD, that's all here NOW. And there hasn't even been a real push by Toshiba or Microsoft lately to attempt to counter Blu-ray as an overall disc medium... just in the movie realm.
As far as Warner is concerned, there's WAY too much speculation on what they may be thinking, and about how they are going to look at one metric but not any others, etc. Warner isn't going to make a decision without having ALL the data... they're not stupid. Most importantly, they know what the effect will be of them choosing a side. If they go HD DVD exclusive, it would produce a stalemate, and we'd all be stuck with combo players as the norm. If they stay neutral, the war will eventually work itself out, and they won't be "to blame" one way or the other. If they go Blu-ray exclusive, they will effectively end this war within a fairly short time frame, but will enrage many early adopters who chose HD DVD. Whatever they choose to do they will pick a metric to cite as their reasoning, but the actual decision will have little to do with player prices, or attach rates, or anything else everyone cites. It will be based on what role they really want to play in this format war. Until they decide that, we should all just be happy to know that we're winning, and have been for some time. The other side will continue to make desperate plays, but, as we're already seeing, they don't seem to make a bit of difference in terms of actual sales. So let them. And just pity the poor people who buy a dirt cheap HD DVD player and find that they have nothing to play on it a couple of years from now.
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