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The Retailing of HD-DVD and Blu-ray

Evan Powell, September 1, 2006

Recently I stopped into a prominent consumer electronics retailer in town to see how they were promoting the new HD disc technologies, HD-DVD and Blu-ray. Just inside the front door was a riveting demonstration of Samsung's new BD-P1000 Blu-ray player. It was connected to an impressive Pioneer Elite 50" 1080p plasma display. The video material that was playing was a loop from a Blu-ray demonstration disc that had been shot live with a high resolution 1080p video camera -- not a transfer from film. If you ever see a product demo of this type you will be blown away by the spectacular image quality. The plain ole TV at home certainly never looked this good.

When I asked if they had a similar demo of HD-DVD, the salesman took me on a long walk to the back of the store. There on a small shelf was Toshiba's HD-A1 HD-DVD player. It was driving a 27" low resolution widescreen monitor. An HD-DVD movie was playing, and on this monitor it looked like pretty good DVD, but nothing special. That's because the monitor was incapable of displaying the full resolution of the HD-DVD format.

If this retailer's objective was to make Blu-ray look as good as possible and HD-DVD as bad as possible, they could not have done a better job. Any typical consumer walking into this store and seeing these demos would naturally assume, quite erroneously, that Blu-ray was a higher resolution format than HD-DVD.

We have visited over a dozen retail stores in the past month, including big chain stores like Best Buy, Fry's Electronics, Ultimate Electronics, Sears, and Tweeter. And with rare exceptions, the story is similar from store to store. Blu-ray is being featured as the premium solution, and HD-DVD is being downplayed as the cheaper and lower performance alternative. In some stores there is an active demo of Blu-ray, whereas there is none of HD-DVD. In others we found Blu-ray being demo'd on large native 1080p video displays, while HD-DVD was being shown on smaller 720p or lower resolution monitors. One store had Blu-ray on a beautiful 46" 1080p LCD flat panel monitor, and HD-DVD in a separate room on a 1080p DLP rear projection TV with ambient light problems. In only two of the stores we visited did we find both technologies being shown on similar 1080p video displays.

In addition to the favorable Blu-ray staging being done on retail floors, most of the sales reps we encountered were armed with a set of talking points. When we asked about the differences between Blu-ray and HD-DVD we got four stock answers:

1. Blu-ray is higher resolution 1080p, whereas HD-DVD is only 1080i.

2. Blu-ray has more storage capacity, so they can put more video on the disc.

3. Blu-ray is faster, so it can deliver a better picture.

4. Blu-ray has more Hollywood studio support, so you'll see more HD movies in Blu-ray than with HD-DVD.

That's a pretty compelling list of reasons to buy Blu-ray. It is hard to believe anyone would end up buying HD-DVD after a pitch like that. But let's take a look at each of these issues more closely.

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