Blu-ray: Beware of the Leapfrog
“Mission Accomplished”
Recent history would suggest not using those two words in combination until victory is truly, 100%, absolutely, beyond the shadow of a doubt achieved. So back in February, when Toshiba halted development and production on its HD DVD players, I was a bit surprised to hear the media claim that Blu-ray was the clear victor in the high definition format battle. Sure there were no mid-sea jet landings, no aircraft carriers and no live-TV press conferences, but Blu-ray was widely hailed as inevitable.
Let’s first give credit where credit is due: Blu-ray killed HD DVD. However, in the age of digital, downloadable media, that alone does not secure Blu-ray’s success. Let’s examine a few recent innovations that have occurred in the home-video industry that may, very well, leapfrog the entire need for Blu-ray:
1. Cable/FiOS Video On Demand
All major cable companies, as well as FiOS, offer this service, often in HD. In fact, satellite is the only major player left in the dark due to technical constraints. The convenience of this offering is its major selling point. Since it runs through your normal set-top box there is no further equipment to buy. The downsides are that 1) the video libraries are small and typically limited to new releases and 2) the rentals usually expire after 24 hours.
2. Apple TV
Apple has offered movie and television show downloads via iTunes for the past couple of years. This made it simple for people to watch shows on their iPods – but limiting the offering to a very small market of commuters and those who just can’t get enough of their iPods (note: we all know these people). With their most recent version of Apple TV, Apple has made it simple to download HD movies using your home network and transmit them directly to your television via direct cable hookup. In fact, the entire Apple TV interface is managed via your TV, so the intermediary of the computer (i.e. the bottleneck of this whole process) is no longer necessary.
Apple TV hasn’t been quite the hit as the iPod, but it’s Apple, so there’s much potential. For one, the library is limited to only a handful of studios – a problem that can easily be fixed with time. And second, this technology relies on fast download speeds which are fairly commonplace in U.S. households, but still not as fast as some other countries.
3. Netflix
Netflix distributes Blu-ray discs as part of its rental service, which is great for Blu-ray in two ways: 1) it is a consistent revenue stream for Blu-ray disc manufacturers as NetFlix tends to keep large libraries on-hand and 2) it promotes the format in general, further expanding the Blu-ray customer base.
However, Netflix is also a competitor. Two days ago, Netflix and Microsoft announced a deal that would stream thousands of movies over the Xbox game console (which, in turn, prompted Sony to announce their own video download service for PlayStation 3). In addition, Netflix is developing a movie set-top box with LG.
Many of these technologies are in their infancy, and they all lack the consumer’s need to hold a tangible piece of plastic. However, in addition to not prematurely claiming “Mission Accomplished”, history teaches us one other thing: people are caring less and less about their tangible libraries. iTunes’ success has proven that downloadable digital music is the wave of the future, and it’s only a matter of time until it becomes mainstream in the video industry. The only unknown is the timeframe, which offers some opportunity for Blu-ray to capitalize if the adoption rate of video downloads continues to grow slowly for years to come.
However, my money is on the leapfrog, not the disc.
