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Format War” Victory, Intent to Purchase the Blu-Ray Disc Player Is Lackluster Few Likely to Purchase a Blu-Ray Player Within the Next Year

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Format War” Victory, Intent to Purchase the Blu-Ray Disc Player Is Lackluster Few Likely to Purchase a Blu-Ray Player Within the Next Year FOR IMMEDIATE RELEASE Despite Widespread Consumer Awareness of Blu-ray’s Recent “Format War” Victory, Intent to Purchase the Blu-ray Disc Player is Lackluster Few Likely to Purchase a Blu-ray Player within the Next Year ROCHESTER, N.Y. – May 13, 2008 ― Two-thirds of consumers are familiar with the recently resolved high- definition format war (67%) and seven in ten of them had heard that Blu-ray is the unofficial winner (69%). It was widely expected that Toshiba's decision to drop out of the market for high-definition HD DVD players and recorders in late February 2008 would lead to an uptick in sales of Blu-ray disc players, incorporating the chosen next generation technology. While nearly a quarter (23%) of those aware of the format war report that they had been waiting for the rivalry to play itself out before purchasing a high definition player, by April, they had yet to do so. These are some of the results of a nationwide Harris Poll of 2,529 U.S. adults surveyed online between April 7 and 15, 2008 by Harris Interactive®. Over a third of consumers now report owning a high definition television set (HDTV) (35%), with incidence higher among males (41%) versus females (28%) and rising decidedly with household income (15% for those with less than $35K vs. 53% among those with $75K+). While ownership of standard DVD players is practically ubiquitous (87%), fewer than one out of ten consumers reported owning any of the devices currently available for playing high definition DVDs, from HD DVD players (6%) and Blu-ray disc players (4%) to Sony PlayStation 3 (5%) and the external HD-DVD drive (1%) for the Xbox 360 (1% have external drive while 9% have an Xbox 360). Furthermore, only 9 percent of the non-Blu-ray player owners report being likely to purchase a Blu-ray disc player within the next year, even when made fully aware that Blu-ray is the definitive technology for high definition DVD players going forward. Notably, the percentage of high definition (HDTV) owners likely to purchase a Blu-ray disc player is only slightly higher (14%). Current ownership of Blu-ray disc players among HDTV owners stands at 10 percent. Why Slow To Catch On? “I expect that a lot depends on HDTV sales in the next year, especially with the pending digital transition.” says Joan Barten Kline, Vice President of the Harris Interactive Media & Entertainment Practice. “But even current HDTV owners are showing lukewarm intent toward purchasing a Blu-ray disc player. There may be price sensitivity mixed with consideration of some alternative options. The Blu-ray disc player pricing is still averaging above the $300 level, well above the $80 to $150 for the latest generation of standard DVD players with up- converters which supposedly generate a higher quality picture than older standard players can from a standard- definition disc. Another option will be the ability to download high-definition videos rather than buying them on discs. While this is likely to catch on more with the technophiles than with the mass market due to the complexity of downloading, it does provide another alternative.” The Harris Poll® #54, May 13, 2008 By Joan Barten Kline, VP, Media and Entertainment Research Practice, Harris Interactive When asked about their interest in a Blu-ray disc player with Internet connectivity expected to be in stores in the Fall in the $500-$650 price range, U.S. adults, including current Blu-ray disc player owners, were twice as likely to say they would purchase a Sony PlayStation 3 which already plays Blu-ray discs and has Internet connectivity for $399 (11%) or an original Blu-ray disc player without connectivity for $399 (10%), versus a new Blu-ray disc player with Internet connectivity for $500- $650 (4%). Not surprisingly, it is the under 40 crowd that is most likely to opt for the PlayStation 3 as their Blu-ray capable device of choice – fully 23% of those in the 30- 39 age group are likely to purchase this device in the next year. What Will Become of the HD-DVD Player? Like the BetaMax loyalists of yore, almost half (45%) of those who currently own an HD DVD player say that they will just continue to use it and continue purchasing HD DVD’s as long as they are available. Another 14 percent of them will continue to use it with the HD DVD’s they have already purchased, but do not plan on buying any new ones. An equal proportion of HD DVD player owners (15%) will continue to use it but also plan to invest in a Blu-ray disc player in the future. Of course, on an HDTV with either a Blu-ray disc player or a HD DVD player, a standard DVD can also be played with the higher quality inherent in up-conversion, but still falling short of the superior high definition viewing experience provided by playing a DVD in either the HD DVD or Blu- ray disc formats. The Harris Poll® #54, May 13, 2008 By Joan Barten Kline, VP, Media and Entertainment Research Practice, Harris Interactive TABLE 1 CURRENT TECHNOLOGY OWNERSHIP “Which of the following devices do you own?” Base: All Adults Have Gender Household Income HDTV Total $34.9k $35k - $50k - Male Female $75k+ Yes or less $49.9k $74.9k % % % % % % % % A DVD player that connects to a TV 87 86 88 82 85 90 92 92 Desktop computer 86 87 85 86 87 88 89 92 Laptop computer 53 60 47 35 49 45 73 69 Wireless router (a wireless network or wireless Internet access in your 47 54 40 32 37 47 67 65 house) Large screen television (36” or 35 38 32 16 34 38 51 65 larger) A high definition television set 35 41 28 15 30 37 53 100 (HDTV) A portable DVD player (not the kind 28 26 29 18 31 32 32 34 that you install in a car) Sony PlayStation 2 24 25 23 23 25 25 27 25 Any other device that plays DVDs 18 23 14 15 16 18 23 23 Nintendo Wii 11 13 9 5 7 12 17 18 DVD player that is installed in your 10 10 10 7 11 9 13 14 car and not removable Xbox 360 9 9 9 6 6 8 13 15 The original Xbox 9 11 7 6 9 10 11 12 An HD-DVD player 6 6 5 2 5 6 9 13 Sony PlayStation 3 5 6 5 3 2 4 9 11 A Blu-ray disc player 4 4 3 1 * 3 7 10 The external HD-DVD drive for the 1 2 1 1 1 2 2 3 Xbox 360 None of these 1 * 1 1 * 1 * - Note: Percentages may not add up exactly to 100% due to rounding. Note: * indicates less than 0.5%; “-“ indicates no response TABLE 2 KNOWLEDGE OF HIGH DEFINITION DVD FORMAT WAR "Before today, were you aware of the high-definition DVD format war? By high definition DVD format war, we mean the battle between Blu-ray and HD DVD to become the next gen format for high definition DVD players." Base: All Adults Gender Total Male Female % % % Yes 67 80 55 No 33 20 45 Note: Percentages may not add up exactly to 100% due to rounding. The Harris Poll® #54, May 13, 2008 By Joan Barten Kline, VP, Media and Entertainment Research Practice, Harris Interactive TABLE 3 AWARENESS OF WINNER OF FORMAT WAR "Before today, were you aware that Blu-ray is the unofficial winner of the high-definition DVD format war?" Base: Aware of format war Gender Total Male Female % % % Yes 69 81 54 No 31 19 46 Note: Percentages may not add up exactly to 100% due to rounding. TABLE 4 IF FORMAT WAR WAS A FACTOR IN PURCHASE DECISION "You indicated that you do not own a high definition DVD player. Were you waiting for the format war to play itself out and declare a winner before you purchased one?" Base: Aware of format war and do not own HD DVD Player or Blu-ray Device HDTV Total Owners % % Yes 23 35 No 12 8 The format war has had no impact on my decision not to 66 57 get a high definition DVD player Note: Percentages may not add up exactly to 100% due to rounding. TABLE 5 LIKELIHOOD OF PURCHASING BLU-RAY DEVICE "Knowing that Blu-ray is the unofficial winner of the high-definition DVD format way, how likely are you to purchase a Blu-ray disc player within the next year?" Base: Do not own Blu-ray Device HDTV Total Owners % % LIKELY (NET) 9 14 Extremely Likely 1 * Very Likely 2 4 Likely 6 10 SOMEWHAT/NOT AT ALL LIKELY 91 85 (NET) Somewhat Likely 26 31 Not at all Likely 65 54 Note: Percentages may not add up exactly to 100% due to rounding. Note: * indicates less than 0.5% The Harris Poll® #54, May 13, 2008 By Joan Barten Kline, VP, Media and Entertainment Research Practice, Harris Interactive TABLE 6 POSSIBLE BLU-RAY PURCHASE "This coming fall, there will be a Blu-ray disc player that will have Internet connectivity so that you can download games and shop for movie merchandise, for example. Knowing that, which of the following Blu-ray capable devices are you likely to purchase in the next 12 months?" Base: All adults Age Total 18-24 25-29 30-39 40-49 50-64 65+ % % % % % % % Sony PlayStation 3 which plays Blu- ray discs and Internet connectivity for 11 17 18 23 8 3 1 approximately $399 Original Blu-ray disc player for 10 3 12 14 7 11 9 approximately $399 New Blu-ray disc player with Internet connectivity for approximately $500- 4 1 5 5 3 7 2 $650 None of the above 78 79 68 65 82 80 89 Note: Percentages may not add up exactly to 100% due to rounding.
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