It’s fitting that the Consumer Electronics Show (CES) takes place in Las Vegas, because at this show we learn which companies have gambler’s instincts. Sony went all in betting that Blu-ray technology would win the next-gen video disc wars, adding Blu-ray capability to its PlayStation 3 consoles.
Microsoft, on the other hand, hedged its bets with the HD-DVD format. While the console didn’t come packaged with HD-DVD capability, gamers could purchase an add-on drive to upgrade. So at the last CES (2008) when Warner Bros. ended the war by announcing it would no longer support HD-DVD, it certainly looked like a win for Sony.
A year later Sony and Blu-ray still have not garnered that much anticipated victory. One of the biggest obstacles is potential customers doing an end run around Blu-ray by downloading movies digitally. Since Microsoft is equally happy to see you on the Internet as it is to see you on its game console, it jumped on the downloading craze by partnering with Netflix (although Sony refuses to do so, at least for now). Xbox Live Gold members that are also Netflix members can download movies to their console in addition to whatever DVDs they order by mail. LG Electronics has announced a new line of high-definition television that can connect directly to the Internet without a need for any set-top box. It will be able to use video on-demand services including the aforementioned Netflix.
Estimates by Digital Entertainment Group put 10.5 million American homes as Blu-ray equipped. At the beginning of the year, its anticipated figure was nearly 15 million. There is good and bad news for Sony there. An estimated 8 million of the Blu-ray homes are PS3 owners. But at least some of those owners would be hardcore gamers that would have purchased the console without Blu-ray.
The head scratching development is the runaway success of the Nintendo Wii, the least high-tech of the current gen consoles. Nintendo has sold 40 million Wiis worldwide with a console that doesn’t even play DVDs, let alone any high definition discs. Had anyone known a $250 game machine could even compete, let alone potentially win the console war, some different decisions might have happened at Sony and Microsoft. If Blu-ray is going to be the deciding factor in the console war, now would be a really good time for it to start.
Black Friday was a big day for Blu-ray with many stores opting to discount Blu-ray players to more affordable price points. That was buoyed by The Dark Knight, the biggest event movie since HD-DVD gave up the ghost. The Batman sequel moved 600,000 Blu-ray discs in a single day.This week at CES is also key as Blu-ray ‘s backers need a strong showing to convince millions who haven’t adopted the new technology that all the cool kids will be doing it. For better or for worse, the fate of the PS3 and that of the Blu-ray format will forever be intertwined.
This week could tell us whether that marriage will be more akin to Will and Jada Pinkett Smith or Britney Spears and K-Fed.