Despite of the fact that premium pricing of Blu-ray movies constrains adoption of the new high-definition video format, the head of Sony Pictures Home Entertainment (SPHE) believes that there is no need to lower the pricing since consumers still buy movies on Blu-ray discs (BDs).
“Certainly on the new-release side there is no reason to change pricing. New-release pricing has held on DVD for a while, albeit heavily discounted at retailers. But we are not likely to change that for Blu-ray,” said David Bishop, president of Sony Pictures Home Entertainment, in an interview with Home Media Magazine while answering the question whether Blu-ray maintains its premium pricing or will dissolve into commodity pricing.
In mid-November the head of Sony Electronics in the U.S. said in an interview with a news-agency that price decreases for Blu-ray players as well as movies were needed to stimulate the adoption of the format. Nevertheless, it seems that for SPHE getting additional profits because of premium BD pricing is more important than getting higher revenues because of inexpensive Blu-ray movies.
Mr. Bishop remains optimistic about Blu-ray. The format is naturally growing and brings in more revenues than digital distribution, according to SPHE.
“[Blu-ray] is continuing to grow and 200% to 300% year-over-year, and the ratio of Blu-ray and DVD sales continues to rise. That calls for optimism. For anyone who said that people would just go to digital and skip Blu-ray that has certainly been proven not to be true. Even if you took Blu-ray separately as a revenue stream, it is probably 20 times larger than digital revenue,” the head of Sony Pictures Home Entertainment said.
It is rather surprising that Sony is reluctant to lower pricing on Blu-ray movies while expressing believes that BD will eventually replace DVD. Currently contend on BDs is considerably more expensive than the same content on DVDs and many consumers may decide to acquire “good-old” DVD at lower price-points despite of lower quality. Since global economic slump is hardly encouraging to buy, SPHE may easily have to reconsider its stance about the pricing on BD movies.