Rich Fiscus
30 Sep 2007 10:38
At least one Sony strategy to promote Blu-ray discs seems to be paying off. As we reported in July, Sony introduced a revenue sharing plan to lower the price of entry into the Blu-ray rental market. Although the move does seem to be at odds with statements from Sony and other Blu-ray backers that the format war is already over, it does seem to be making at least a small impact.
Hastings Entertainment, a regional retail chain based in Amarillo, Texas that already offered video rentals in addition to CD, video, and book sales, has expanded their selection of Blu-ray discs available for rent. According to video category manager Mason Goodfellow, the move is a direct result of the revenue sharing program.
“It basically helped us to spread [Blu-ray] to all of our stores and not have to make that much of a financial investment,” said Mason Goodfellow, Hastings video category manager. “We might be able to get in as many as eight to 10 copies per Title [in one store]. Without revenue-sharing, that might have been three to four copies.”
Although the format war is certainly far from over, it's more than a little curious that HD DVD backers have been relatively silent when it comes to promotions. Blu-ray promotions, primarily from Sony but also from companies like Matsushita and Disney have been abundant. HD DVD promotions, on the other hand, have primarily been related to Microsoft's Xbox 360 HD DVD add-on, although Toshiba, HD DVD's biggest supporter among standalone player manufacturers, has been a leader in pricing, with their HD DVD players consistently the cheapest for hi-def formats. Still, the amount of PR and promotion for Blu-ray seems to dwarf the efforts made on behalf of HD DVD. This may indicate confidence, or may simply be a sign that Toshiba and Microsoft are holding off on expensive promotions until there's enough market share available to actually make the product profitable.
Sony, of course, has made a big deal of the move. “Naturally, SPHE is delighted about this since Hastings obviously acknowledges the fact that consumers have voted for Blu-ray as the high-definition format of the future,” said Marshall Forster, Sony senior executive VP of North America.
However, as usual for both sides in the format war, this is clearly not the case. If the decision had been made by consumers there would be no need for financial incentives to put DVDs on rental store shelves.
Source: Video Business