Sony’s domination = How much profit?

[sharky]

Quartz said:

sharky said:

Look at what IGN says

 

April 20, 2007 - In breaking news today, it would appear that mega-retailer WalMart has contracted a Chinese manufacturer to produce millions of low-cost HD-DVD players. Though somewhat obfuscated by translation issues and the breaking nature of the news, the current internet consensus suggests that Taiwan based manufacturer Fuh Yuan, in cooperation with TDK, will produce the blue laser drives for 2-million HD-DVD players. Broadcom will reportedly supply the system-on-a-chip decoder, and China Great Wall will handle final assembly. The deal represents around US $100,000,000, and it is reported that a new manufacturing plant has already been opened to fulfill the order.

Speculation suggests the players will arrive at retail in late 2007 and will be priced between $199-299. At such cost, WalMart's HD-DVD drives will be far below the current low of $399 for Toshiba's HD-A20 player, and will look cheap compared to the lowest priced Blu-ray hardware on the market today ($599).

If the current details of the plan prove to be true, WalMart's support of HD-DVD will have a significant impact on the next-gen DVD format war. The American retailer operates on a high-volume, low-margin business plan of market saturation, which is exactly the approach required to drive one format or the other to preeminence.

Stay tuned for updates and confirmation as the story develops.

Really they are getting China to do the cheap labor behind the HD-DVD manufacture. That's not a surprise as the price of HD-DVD/Blue Ray discs are about the same price as each other. Trying to force a player out at a cheap price with the lesser support behind it in terms of movies and companies is really a short term cash in before the format is lost to blue ray.

That's how I see it. It might sound anti HD-DVD, but it's the truth.

Sony of course never invented Blue Ray, however I feel it was right to back it with the majority of companies taking it up. http://www.engadget.com/2005/09/19/blu-ray-vs-hd-dvd-state-of-the-s-union-s-division/ Comany list

It may be a last stand response for HD-DVD. People are not that stupid, Blue Ray in shops looks a lot more promising to customers than HD-DVD because more companies support it.

How is it a cash in if they're driving costs dirt cheap therefore making less money?

Wal Mart now has a hundred million investment in HDDVD, that means they now are going to fully support the format over Blu-Ray, basically.

 

The order is for two million players..considering probably less than 100k stand-alone Blu-Ray players have been sold (meaning, not PS3's), that's a huge magnitude.

Plenty of companies, huge companies, support HDDVD, like Intel, Microsoft, and Toshiba which is a PC OEM that ships millions of PC's.

 

The studios support looks good for Blu-Ray, but a lot of the companies in Blu-Ray camp have offered only half hearted support such as 20th Century Fox. The problem is if the tide swings to HDDVD because of things like this Wal Mart order, they will all jump ship. Sony itself will be the last one to jump ship.

 

Companies like Samsung and TDK that were founding members of Blu-Ray, have actually already begun playing both sides now. Samsung for instance introduced a combo player and said they would introduce a HDDVD player if necessary. That's not good for Blu-Ray. 

But Sony has a terrible track record with formats, Betamax, Atrac, UMD..is Blu-Ray next?