The high definition disc markets in both the USA and Europe continue to perform in line with expectations, with consumers expected to buy close to 45 million Blu-ray discs in the US this year – more than 400% up on last year – according to Futuresource’s consistently bullish BD forecasts even in the face of reported lacklusted in-store marketing drives and ‘interloper’ DVD upconverting players.

“On big titles, the share of total sales being taken by BD has already hit 5-6% and by Q4 it is possible we’ll see a 10% or even 12% share for some of the really big hitters.” In Europe, awareness and uptake are still lower overall, “although in the key markets the retailers and the studios are reacting to an uplift in interest this year and are gearing up for a good end to 2008.”

“2% of unit sales in the lead markets of the UK and France to be on BD this year and this is likely to hit 5-6% next year,” says Mai Hoang, a lead analyst in the Futuresource Home Video team. “By 2012, between 40% and 50% of consumer expenditure on video discs will be allocated to Blu-ray.”

Futuresource concedes that the lack of catalogue title sales has been disappointing. “All eyes are on Warner’s initiative to cut catalogue prices,” continues Hoang. “Other studios and the retailers are going to be watching consumer reaction to this very carefully.”

“Much of the drive behind this [retailer support] increase is coming from growing consumer awareness and falling hardware prices, coupled with PS3 owners increasingly using their consoles for video playback,” adds Jack Wetherill, who focuses on the hardware business at Futuresource. “I would be amazed if we don’t see a Blu-ray player in the US at or below $250 by the end of this year, and in order to stimulate consumer traffic in the holiday season who’s to say there won’t be a product at closer to $200? In the UK, player prices will fall to around £149 and there may be one or two companies trying to better that.”

When it comes to music titles, however, the content industry may have “missed the boat”, according to Futuresources’ music and mobile specialist David Sidebottom, who describes music release sales as “currently relatively insignificant” in the total Blu-ray market, which is expected to hit around 4.5m unit sales by the end of the year.

Sidebottom suggests that music titles will account for no more than 3-4% of the total market this year and also warns that manufacture and supply issues could further hamper sales in the fourth quarter because products might not be ready in time for the key selling months leading up to Christmas.

He says: “Blu-ray music sales are expected to gain momentum by the end of the year, as stronger, high profile titles are released. As in the Music DVD market, evergreen and strong live acts will provide the majority of sales in the sector, with a more mature buyer evident.

He adds that although selected Blu-ray music titles could see significant volumes, a repeat of the success of the early days of Music DVD is unlikely.

Story filed 26.08.08