Tuesday, October 28, 2008

Slashing Prices on Blu-Ray Players

The Wall Street Journal has an article today about retailers slashing prices on Blu-Ray DVD players. The article is interesting, because it suggests that the retailers are not simply cutting price because of the down economy. They also are doing so because of fears of the oncoming move to digital downloads. They are trying to encourage adoption of the players, and thereby substantial purchases of Blu-Ray DVDs, before consumers begin to adopt video-on-demand and digital movie downloads in far greater numbers. In a sense, we have a race going on, with firms trying to make sure that we move from regular DVDs to Blu-Ray and then on to digital downloads in that order... the worry is that consumers might just leapfrog Blu-Ray, moving directly from normal DVDs to digital downloads and video-on-demand. The other major challenge in this market is that we may not have enough of a technological advantage to justify, in consumer's minds, making the upgrade to Blu-Ray... especially given the large inventory of normal DVDs that customers have in their homes.