Warner Cuts Back Blu-ray and HD DVD Sales Projections

Earlier in the year rose-colored glasses must have been somewhat in style when Warner's Steve Nickerson was quoted as saying that Warner, which supports both Blu-ray and HD DVD, expected consumers to spend "between $225 million and $500 million during the fourth quarter (of 2006)." He also predicted that by the end of 2006 that there would be 500,000 Blu-ray and HD DVD standalone players sold, plus two to three million game consoles and two to four million computers with HD DVD or Blu-ray capability.

According to a recent article at Video Business, Warner's Nickerson is now predicting that $750 million will be spent on HD hardware in the fourth quarter, down from the initial projections of $1.5 billion to $1.9 billion. Warner is now predicting that $150 million will be spent on software, down from the $225 million to $500 million originally estimated.

Of course, before discussing the harsh realtiies of what actually did happen, it's fair to note that once upon a time, Sony's Blu-ray based PlayStation3 was due in stores for late spring '06, and standalone Blu-ray players were due from several different companies early in the summer to coincide with software launch.

Well, here it's October, and neither of the gaming consoles expected to help drive next-gen disc sales are on the market. The Blu-ray based PlayStation3 and the HD DVD external drive for the Xbox 360 are now scheduled for release in the second half of November. Toshiba has only two HD DVD players on the market which have been universally praised for image quality and interactivity of the HD DVD discs released so far, but also panned for glitches and ergonomic foibles. At CEDIA 2006 Toshiba claimed to have HD DVD penetration into 30,000 homes in the US and announced that two new players would be available by the end of the year. And, while I don't have the numbers in front of me I'm betting Samsung's isn’t making a big enough dent to get close to that original 500,000 standalone player estimate.

On the Blu-ray front, well, discs keep coming out but what can you play them on? Samsung's BPD-P1000 is the only Blu-ray player currently on the market and it's been universally maligned for offering poor mage quality due to a defective setting of a noise reduction setting in one of its video processing chip sets, and has not released the promised firmware update to fix it. Standalone players from Panasonic, Pioneer and Sony have been pushed back for release sometime between now and December. So, while the list of impressive software titles on both formats is robust, and growing every day, there simply aren't players out there to play them on, and as successful as HD DVD is producing top quality picture, sound and interactivity, it has only three studios supporting it so far.

I suppose we'll know for sure sometime early next year, but these estimates are kind of fun in the meantime. Of course, I'd hate to be the one taking these revised numbers up to my boss!