A less upbeat assessment of the Blu-ray format to date is offered by Digital Tech Consulting (DTC) who does not expect Blu-ray to represent more than a third of all DVD devices sold five years from now. DTC estimates that global non-PC Blu-ray deck sales will represent only 3% of all DVD devices sold in 2008 and only 31% by 2013.

As for pre-recorded packaged media, DTC estimates that nearly 5.5 billion DVD discs will ship into the market in 2008. For pre-recorded Blu-ray, the estimate is upward of 180 million. Even with an impressive growth curve, DTC projects that the HD discs still won't come close to approaching DVD disc shipments in the future.

DTC believes there are more game-changing reasons Blu-ray won't approach DVD's success. The most profound factor is the new network delivery option available to content owners to get their HD content to consumers. Traditional pay-TV service providers, as well as Internet and mobile-service providers, now have a greater ability to offer consumers an alternative to packaged media. The increased bandwidth afforded by AVC/H.264, as well as upgrades in network infrastructure, should aid traditional pay-TV providers in convincing consumers to get more of their TV and movie programming through HD video-on-demand and DVR services.

Even though the Blu-ray format may not reach the successful heights of its DVD cousin, DTC estimates that it will experience explosive growth throughout the coming years. Forecast is that nearly 3 million Blu-ray PCs will ship in 2008, growing to more than 15 million by 2012, for a five-year CAGR of 62%. Similarly, Blu-ray CE products will experience a CAGR of 111% over five years, with unit shipments of just over 5 million in 2008 growing towards 36 million units by 2012.

With a CAGR of 257% between 2007 and 2012 for prerecorded Blu-ray discs alone, there is no real argument for saying the Blu-ray format will be less than a success. Which yardstick the industry uses to measure that success, however, is a different matter. New distribution pipelines will force the industry to change how it assesses the success of individual sectors.

DTC believes that the additional choices consumers will have for receiving entertainment programming will create a bigger market for direct delivery of video programming. But that doesn't mean the news is good for all players. Without some radical changes in business models, incumbent video-programming providers must contend with some erosion in their core businesses. The only unknown is the degree of erosion.

Blu-ray may have emerged victorious in the HD video disc format war, but its supporters had better keep their armor on, because the bigger battle is the one commencing between packaged media and electronic distribution of content, DTC concludes.

Story filed 26.08.08