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Wal-Mart Shrugged – DVD and Blu-ray Fell

by October 08, 2009

Never underestimate the power of Wal-Mart! The retail juggernaut has the power to destroy a product line’s sales by deciding not to sell it - or simply pushing it to the bottom shelf. Wal-Mart recently trimmed down its DVD shelf to free up space for better selling items. Now tremors are being felt across the entertainment industry. But is Wal-Mart contributing to a consumer paradigm shift or simply responding to one? 

If you’ve looked for your favorite new movies at Wal-Mart lately, you’ve had to hunt a little harder than you used to. The world’s largest retailer has decided to remove display cases promoting new-release movie titles and trim down the total amount of shelf-space devoted to disc-based media. The move is part of a broader effort to tidy its aisles, reduce corrugated cardboard displays and overall spruce up its image in an effort to appeal to a higher-end shopper. 

Is Wal-Mart turning its back on its sweat-pants-and-crocs customer base that made it the world’s tawdry ambassador of the Sino-made second rate? 

They’re calling it “Project Impact” and the idea is to devote more shelf space to only the best-selling items and cut back on those that tend to sit and collect dust. So far, DVD and Blu-ray discs have turned into one of the project’s high-profile casualties. Despite denials from studio execs, it’s another wooden stake through the heart of a declining industry. 

"We think the new strategy implies Wal-Mart no longer sees DVDs and Blu-ray discs as traffic drivers," J.P. Morgan analyst Imran Khan said. 

The Digital Entertainment Group says retail sales of DVD fell 13.5% in the first half of 2009, reducing it to a mere $5.4 billion industry. But DVD rentals rose by 8.3% in the same period as it stands at a $3.4 billion dollar market. Many will see a future in digital downloads, and they may be right. 

According to the Wall Street Journal’s numbers, the digital downloads market is on-fire, climbing 21% to $968 million. Don’t forget Video On-Demand. Comcast says its cable-rentals have grown 11% from last year. 

This Disc Won’t Repeat

Don’t expect Blu-ray to save disc-media. Despite healthy growth in the Blu-ray market, evidence suggests it’ll never do what DVD has done since the late 90s. 

According to VideoBusiness.com, Blu-ray sales are experiencing healthy growth, for now. DVD and Blu-ray hardware sales are currently neck-and-neck, if you discount video game consoles. But, include PS3 (and its built-in, mid-end BD player) and Blu-ray player sales get a slight bump ahead of DVD. 

Forecasts indicate Blu-ray sales should continue to grow through 2013. But it’ll never catch up to DVD player’s household presence, this is because of competing options for your home-movie dollar. 

Digital Downloads, Crocs-and-Sweats for your Media 

As slick and convenient as digital downloads can be, any video-phile, Audioholic or private property-owning home theater lover must remain vigilant. 

Theoretically it’s possible for a digital download to be the same audio/video quality as disc based media. But even a premium service like Vudu HDX pales in comparison to a Blu-ray disc with a lossless audio codec. 

It’d be nice to do away with packaging and just download a purely digital copy of any media you could own. But therein lies the problem – buying a thing in the digital domain is no evidence of ownership. 

Up The River without an Orwell 

Amazon.com had its first run-in with our distinctly 21st Century private-property issues with its electronic book-reading device, Kindle. Users that bought-and-paid-for e-books on Amazon by George Orwell including 1984, had their copies deleted without warning. This set off a firestorm in the press that threatened a PR disaster for the fledgling gadget from Amazon. It became obvious to users that when you use Kindle - Big Brother is definitely watching you!

It turns out Big Brother will pull the plug on your property any time it decides you’re reading unlicensed material. 

Amazon couldn’t have picked a more ironic writer to delete. Orwell is the author of cautionary tales involving futuristic privacy issues, including 1984 and Animal Farm. 

The Kindle episode highlighted what digital audio-video aficionados have been dealing with for years - there is no ownership of digital media! Unless you have a physical disc collecting dust or a file that is completely DRM-free, you own nothing more than an agreement to playback the file on only certified, licensed devices. The freedom of digital suddenly feels like barbed wire.

Until all digital downloads learn the principle of private property and trashes DRM restrictions – I’ll stick to discs, even if I have to don the sweats-and-crocs to get them.

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About the author:

Wayde is a tech-writer and content marketing consultant in Canada s tech hub Waterloo, Ontario and Editorialist for Audioholics.com. He's a big hockey fan as you'd expect from a Canadian. Wayde is also US Army veteran, but his favorite title is just "Dad".

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Recent Forum Posts:

lsiberian posts on October 16, 2009 15:38
BMXTRIX, post: 635413
I would wonder why anyone would actually buy a decent HDTV then NOT spend $200 to get a quality player which can handle their entire DVD collection as well as allow them to rent/buy BDs to play back true HD on their HDTV.

My Blu-ray player cost 150 shipped from amazon.

In response to the cost of Blu-ray's

I will pay 30 dollars a disc if it's a movie I love. Consider how much work went into a great film. Millions of dollars. So if a movie is worth the millions it creates to produce I have no issue giving that studio more movie to make another great film. I own every Stargate item on dvd and will upgrade them to blu-ray as the opportunity comes because I love the show. I've bought it at every opportunity in hopes they keep making great shows and movies. Maybe I'm insane, but I'm ok with that.

If you really like something should the person who made it get paid for it?
Wayde Robson posts on October 15, 2009 12:18
BD movies are mostly too expensive. But then… isn't everything?

That's what bargain bins are for. I'm afraid I rent movies I really want to see and only buy a select few. I will mercilessly raid bargain bins with BD discs selling at <$20. It's not uncommon, even here in the land of higher taxes.
Wayde Robson posts on October 15, 2009 12:14
BMXTRIX, post: 634757
certainly isn't causing Blu-ray to ‘FALL’ as the title proclaims. Which is just one of the complaints I've regularly had, despite my respect, with Audioholics

Well BMX - I can honestly say that there is no one-way thought process on Audioholics. We don't always agree on everything.

I think most Audioholics editorials I've read have been pretty clear that the format ‘war’ was worse than either side. I wanted to see the industry get behind one or the other more than I cared about either. Now that BD is it, I'm a strong proponent of the format. It easily offers the best SQ/PQ all around.

I'd say we agree.

Oh, and don't put too much into a headline. They're usually designed use keywords and allude to some thing humorous or catchy. Wal-Mart shrugged is a reference to an Ayan Rand book - Atlas Shrugged. I'm a Rand fan! The effect of Wal-Mart's “shrug” is nothing but bad for Blu-ray. That's not just my observation, it's quoted from industry observers. If anything I'm hopin' it ain't so.

I'm supportin' BD … until digital downloads can get rid of video DRM and provide HD/hi-res movies delivered by studios. Then I'd gladly buy all my movies online.

“Delivered by studio” is important. I want high quality engineering going into the digitization of my media. I want accountability and a studio or office to blame if sound and PQ is crap when they release a movie to a file format.

The trouble with VoD/Downloads is you just don't know what you're getting. It's a mystery how it was converted, or what exactly it was converted to.

At least with a disc format you have full disclosure and a studio to blame if it's not of high quality.
BMXTRIX posts on October 15, 2009 09:38
palmharbor, post: 635194
Blue Ray Discs are just too expensive. Period. Pricing a three disc set of BOURNE movies is a mere $80! Business people have a tendency to shoot themselves in the foot. There is no way I want a Blue Ray player for $199
if it costs me a $27 for one movie. Not just for an improvement in the
picture. Unless the Blue Ray HDMI cable runs through your Dolby Digital
receiver and back to the TV you cannot receive True HD Audio. Few people are going to go to the trouble.
While what you say makes sense, it only does so if you don't own a HDTV and don't care about getting great video quality and truly only shop at brick and mortar stores without patience.

I can definitely attest to the concept of doing some smart shopping instead of just buying whatever. I've paid, on average, less than $15 a movie for the titles I own, which is, as I said, about 100 titles. If I were to buy DVDs ten years ago, it would have cost me at least that much to get the same titles on DVD. 20 years ago, it would have cost me five times as much to get the movies on VHS.

Plus, above all else, you don't have to BUY a single movie!

Blockbuster Online, Netflix, Redbox… You have choices galore to rent as many movies as you want for well under $20 a month.

Considering that most people with a HDTV pay for HD cable/satellite service, often for $10+ a month extra, the cost for renting as many movies as you want for around $20 is almost negligible.

Cost, of course, should be a consideration for everyone, and is a fair consideration. But, buying a new HDTV has a cost which should be a consideration before you buy it. Do you get a very good HDTV at a proper size for your viewing distance and pair it with a good HD source or do you get the 32“ Vizio from Wal-Mart and sit 10 feet from it and think that it is HDTV you are viewing with your composite video connection?

Blu-ray Disc, with a HDMI cable, to you typical 50” display will ALWAYS deliver better video quality than DVD is capable of. Whether you buy, or just rent, the quality will always be better, and the potential for better audio by using a receiver with HDMI inputs and a surround setup, is avaialble, and ONE CABLE easy. Your statement implies that the alternatives are easier!

Some typical ways to do A/V through a surround system - best to worst:
1 - HDMI (carries audio & video) (1 wire)
2 - Component video (3 wires), optical (or coaxial) digital audio (1 wire)
3 - Component video (3 wires), analog audio (2 wires)
4 - S-video (1 wire), analog audio (2 wires)
5 - composite video (1 wire), analog audio (2 wires)

Kind of a weird thing to point to a one wire solution as being to complicated for you, and pointing to the highest prices possible as your standard for comparison.

I would wonder why anyone would actually buy a decent HDTV then NOT spend $200 to get a quality player which can handle their entire DVD collection as well as allow them to rent/buy BDs to play back true HD on their HDTV.
BMXTRIX posts on October 15, 2009 09:22
Clint DeBoer, post: 635400
I know I sure would never buy a Blue Ray player. But I bet it would go well with those Paradime speakers I got off that white van… lol.
Don't be hatin' on the Paradimes! They blend beautifully with my Sunfyre subwoofer.
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