Originally Posted by AVRevForum.com
According to a report in VideoBusiness.com today, Toshiba sold over 90,000 of its HD-A2 and A3 HD DVD set-top players last weekend. The unprecedented sales spike comes as Toshiba in partnership with big-box retailers like Best Buy, Circuit City and Wal-Mart, absolutely shattered price barriers for HD players by dipping below $100 for the A2 player, and $199 for the newer A3 player.
Competing Blu-ray players, including the “it-plays-every-Blu-ray-disc-made” Sony Playstation 3 Blu-ray-based game system are still priced firmly in the $350 to $500 range, thus creating a barrier to entry for many mainstream users who have been buying HDTV sets by the millions per month yet haven’t invested in either of the HD disc formats to date. Reports from the Blu-ray camp, suggest that consumers should not expect commiserate price drops for Blu-ray players this Holiday season, with $399 being the drop-to-price for a standalone player according to Sony executives.
The surge in sales activity should come as no surprise as tens upon tens of millions of HDTV sets are now installed in the market, and content providers like DirecTV, Dish Network and various cable companies struggle to keep up with the hunger for HD material 24/7/365, from those who have made an investment in a new television. Additionally, by dipping so low – so quickly – HD DVD players have priced themselves compressively with traditional DVD players which can be found in most mainstream retailers including warehouse retailers like Costco for less than $100. With the all-important “HD” moniker, mainstream consumers are willing to make the leap into a new technology when the cost barrier is at such a low level. Some industry experts suggest that within the next six to twelve months, traditional DVD players will be hard to find on store shelves as HD DVD players are completely backwards compatible with legacy DVD discs.
With a spike of 90,000 players entering the market significantly before the “Black Friday” selling season, Hollywood Studios should look toward higher-than-expected HD DVD software sales in December and in early 2008, as consumers will not want to simply play traditional DVDs in their new players and on their brilliant, new HDTV sets. Tempting, feature-laden titles like Transformers, Hulk, Batman Begins, the films of Stanley Kubrick, and beyond will tempt consumers to get into the world of HD discs for the holidays. The question still remains on whether or not studios will drop some of their disc prices from $24 and $30 for back catalog films to lure more mainstream consumers to buy the HD version of their films on home video instead of the lesser priced, traditional DVD versions.
by: Jerry Del Colliano
This worked so well that the whole industry is trying to figure out how to take advantage of it. Everyone took notice and Toshiba has to realize that they now know they can capture the market at $99. I'd be crunching numbers at Toshiba right now to see if a sales price of $149 for the A3 would be possible to push HD DVD over the 1M in home mark by years end.
Toshiba just figured out how to make someone buying that HDTV add a player. Something that neither side had successfully done yet until this past weekend.
90,000 players in one weekend. The only thing that stopped it from being more was lack of product. You know Toshiba has to be thinking "we can end this now if we can take a loss."
It's the same thing that Sony has been doing from the begining with the PS3, they lose hundreds with every PS3 sold. The difference is that 6M PS3 wont sell movies like 6M HD DVD players would.
If Toshiba really wants to end this war they can do it now, and just drop prices and take the loss. DISNEY, FOX, MGM, and LIONS GATE will not ignore an established base of 1M+ units especially if half of those were sold in a 2 month time frame.