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In 2009, Blu-ray title prices have declined rapidly and the pricing gap is narrowing, according to Futuresource Consulting’s price tracking service. The service shows that in February the average Blu-ray price for new release movies in the UK was £27.29. By the beginning of August this had dropped to £16.74 – a sizeable decline of 40%.

Catalogue pricing has also fallen, but not by such a significant amount. From an average price of £16.87 in February, this dropped to £14.25 in August, representing a decline of 15%. When looking at the average catalogue price across the three largest etailers, (Amazon, Play and HMV), the price drop is far more significant, with the average catalogue price hitting £11.22.

Back in Q4 2008, both in the USA and the UK the premium for purchasing a new release title on Blu-ray compared to DVD was between 30% and 80%. However, for catalogue BD titles this premium was considerably higher, and in some instances was as much as 300%. Although it has never been disputed that consumers will pay more for Blu-ray, the premium in the market in 2008 was clearly not sustainable.

“Pricing is becoming an increasing area of focus for Blu-ray,” says Alison Casey, Head of Global Content at Futuresource Consulting. “Although a number of new BD releases are beginning to achieve healthy sales volumes, catalogue titles continue to disappoint. The retail price of Blu-ray titles, particularly when compared to DVD, is a key factor in holding back sales. Research shows that Blu-ray player owners are making a value judgement call when deciding whether or not to pay the Blu-ray premium; often continuing to buy some titles in standard definition.”

With more than 1,100 BD titles to choose from, combined with growing retail support and increased promotional activity, the rise of Blu-ray will help to offset declining sales of standard DVD product. European sales of BD movie titles are expected to top 31m by the end of 2009 – a more than three-fold increase on the 9m sales recorded in 2008. By 2012, around 35 percent of Western European video disc retail sale volumes will be Blu-ray (the US figure will be 50 percent).

Focusing on the UK, this year Futuresource expects both BD player and BD disc sales to more than treble. UK disc sales could hit 12 million given the strong release schedule for Q4.

On the hardware side, Futuresource’s quarterly BD hardware tracker shows European BD player sales, excluding PS3, are running at close to 300 percent up on the equivalent period last year.

The analysts expect to see players at or below €100 by the Christmas selling season. They reckon BD players will approach impulse purchase level very soon and at these levels people will be increasingly tempted to replace DVD players with the newer format. They expect that over 20% of European homes will be BD enabled by the end of 2011.

Source DVD intelligence – reproduced with permission