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Plunging player prices to reveal Blu-ray vs HD DVD winner?

'Format clarity' coming in 2008, says analyst

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A clear leader in the battle to be the top next-generation optical disc format could emerge next year as player prices plummet and take of the cost of entry out of the equation, market watcher Understanding & Solutions (U&S) has claimed.

While consumers remain confused about whether to back HD DVD or Blu-ray Disc, the high cost of players has allowed them to step back from the debate. However, falling prices have brought both technologies within reach of a greater number of consumers, paving the way for a more unequivocal choice of format - what U&S calls "format clarity".

“Blu-ray and HD DVD player prices have been falling since the Summer, culminating in Toshiba’s loss leading sub-$100 HD DVD player, available in the US last month for a limited time,” said U&S consultant Jeremy Wills.

“Price reductions in the US have continued into December, with Blu-ray players dropping below $300 for the first time, and HD DVD players below $200."

Further reductions are on the cards, said U&S senior consultant Bill Foster. "In early 2008 we’re going to see the Bill of Materials for a basic High Definition player, in either format, weighing in at less than $150, and that’s going to impact the High Street very soon, providing the consumer with a choice of low price players that allow CE companies a margin for profit.”

Buyers in Europe are going to have to wait a little longer for a wide choice of cheap hi-def players, but U&S said it reckons average player prices - as opposed to entry-level model pricing - for HD DVD and Blu-ray of $275 (£138/€192) and $475 (£239/€331), respectively.

Assuming neither format drops out of the race, by 2011, HD DVD and Blu-ray players will both retail for less that $100 (£50/€70), U&S forecast.

“As demand grows and manufacturing volumes build, we’re going to see the costs of releasing on two different formats really start to bite," said Foster.

"There may be surprises just around the corner.”

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