Bluray Player
The Blu-Ray player is a media player that is produced and marketed by the Sony Corporation. It was first introduced in Japan in 2000. Over the course of the next several years, the Blu-Ray entered into competition with the DVD, in particular the HD DVD that was championed by rival Toshiba. In early 2008, Toshiba announced that it was going to discontinue the HD DVD, effectively ceding the market for movie playing formats to Sony (Toshiba, 2008). The two products were competing as digital video formats for playing movies and television shows in particular. The result of this move is that the Blu-Ray was expected to be the dominant format for this service offering. That has not come to pass, and this paper will seek to explain why, from a marketing perspective.
Historical Context
There is a brief note to be made about the historical context. Sony engaged in a similar battle before with the Betamax player for movies in the late 1970s and early 1980s. This format competed with the open-source VHS format. Although Betamax was considered to be technologically superior, Sony's insistence on controlling the technology led it to lose this battle. The Blu-Ray vs. HD DVD conflict mirrored that competition. It was expected that if the superior format won this time (Blu-Ray is considered to be superior) that Sony would enjoy success.
Blu-Ray After 2008
From a product perspective, Toshiba's withdrawal from the market was seen as a victory for superior technology. While Blu-Ray had a smaller market share, Sony's control over exclusive content was perceived as a market edge -- Sony is a content producer while Toshiba is not. With the way paved for dominance, the Blu-Ray should have achieved a dominant market share. By 2010, Blu-Ray's sales were increasing in Europe, but HD DVD was still the market leader (Chacksfield, 2010). Pop (2010) notes that notebook makers were reluctant to transition to Blu-Ray, as there are costs associated with switching to the Sony technology, and that many consumers remained unconvinced of the value of paying more for Blu-Ray. The prices on Blu-Ray players dropped steadily throughout 2010 in response to this apathy (Pop, 2010). In 2012, while Blu-Ray market share continues to grow, it still remains below 50%, four years after Toshiba ceded the market to the technology (Digital Digest, 2012).
There are two obstacles that stand in Sony's way. The first is that many computer makers continue to use DVD players -- this is a more common format and a more flexible one that can handle software, movies, music and data. Toshiba still does not include Blu-Ray in its laptops. Looking to another computer maker, another problem is revealed. The MacBook Air from Apple does not have any driver, DVD or otherwise. This is because of the rise of digital streaming as a format for watching video content. Corrigan (2012) notes that while Blu-Ray players are still growing, Internet-based content models are reshaping the market for video content. Services like Netflix in particular challenge the need for consumers to even need to own physical media players.
Thus, the decline of the Blu-Ray relates not only to the slow acceptance of the product by consumers, but also by the rapid acceptance by consumers of alternate delivery models. Blu-Ray is a physical product inherently, and simply cannot compete with digital delivery. The trend towards digital delivery, it should be noted, is not global. In major markets like Japan, North America, Australian and Western Europe, digital content is growing rapidly because the bandwidth infrastructure allows for it, and consumers are able to afford the technology required to play high quality content seamlessly. Digital delivery is not growing rapidly in the developing world because bandwidth and consumer devices cannot handle it. In those markets, Blu-Ray is often hampered by its high cost relative to DVD. Consumers who do not have high-end digital televisions cannot differentiate between the two anyway, so there is reason for...
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