DVDGuy’s Blog @ Digital Digest

Sigh.

Welcome to the third series of “My PS3 just broke”. Unfortunately, for the third time in one and a half month, I have to sent in my PS3 to get it replaced by Sony tech support. PS3 number 1 had a faulty Blu-ray drive, PS3 number 2 had the controller/remote drop-out problem and PS3 number 3 has the same problems as PS3 number 2 and also it refuses to restart after drop-outs (and even connecting the controller using the USB cable won’t help - it’s the exact same problem as described here). So it’s off to Sony again to get yet another PS3. Great!

For reference, here are the posts I’ve already made about this:

My PS3 just broke - firmware 2.42 to blame?
My PS3 just broke - Part 2
My PS3 just broke - Part 3
My PS3 just broke - Final
My PS3 just broke - Final (followup)
My PS3 just broke - Redux
My PS3 just broke - Redux Part 2
My PS3 just broke - Redux Part 3

I explained everything to the Sony tech support gal that answered, and even she was baffled as to why I would receive two consoles, both with the same problems. Perhaps I’m just unlucky then, and apart from trying to get this new exchange expedited, nothing else could be done for me. I will give them one more chance to get me a fully working PS3, but after that, I will have to demand some special actions be taken (like, I don’t know, perhaps give me a PS3 that actually works or something outrageous like that).

The September 2008 NPD sales figures are out, and there are some surprises. The holiday season is just starting, and the figures show a slight lift in sales compared to the last month. We are near the few months of the year when most consoles and games are sold, and we shall see who has positioned themselves best for this upcoming holiday season. You can read last month’s analysis here. The figures are from NPD, a marketing research firm that releases games console sale data every month.

The figures for US sales in September are below, ranked in order of number of sales:

NPD September 2008 Game Console US Sales Figures

NPD Game Console Total US Sales Figures (as of September 2008)

 My prediction last month was:

… the (Xbox 360) price cuts already done with, the momentum could swing back to the PS3 again. The Wii will sell well, and probably recover a bit just in time for the holiday season.

I was right about the Wii, but I was wrong about the Xbox 360. As this month’s figures show, the price cuts had a huge effect on Xbox 360 sales. The surge it produced was enough to propel the Xbox 360 to the third most popular video game hardware, out-selling the PSP and the PS3.

The Xbox 360 also out-sold the PS3 last month, but it was by a much smaller margin. I’m not sure price cuts are a long term solution, but for this holiday season at least, the Xbox 360 is positioned very well to compete with the PS3 and possibly even the Wii. Sony has already come out and said that they won’t cut PS3 prices this year, so I think Microsoft will emerge as the overall winner for 2008 in the war against the PS3. Microsoft is probably trying to achieve some sort of critical mass for the uptake of the Xbox 360, because if enough of your friends have Xbox 360’s, then you would want one too, wouldn’t you? The superior multiplayer system of the 360, despite not being free, will further drive this sort of “peer pressure”. If you want to a curr-gen console somewhat comparable to the PS3, good multiplayer support, a huge range of games at cheap prices (I saw older Xbox 360 hits like Dead Rising, Crackdown on sale for $10 this week … amazing value for hours and hours of fun), then the Xbox 360 is your only choice. The Wii is another, but only if you don’t care that your games look a bit crap on your 50″ HDTV. The Japanese sales figures which have shown the Xbox 360 out-selling the PS3 on its own turf is just the cherry on top, really.

Sony on the other hand are probably not worried about PS3 sales being slightly flatter this year, or even the next. Remember, they’ve said they have a 10 year strategy for the PS3 and this is only the second year. They believe they can achieve something similar to the PS2, where even now, it is still selling in good quantities and there are now more than 42 million PS2s in the US alone. Of course, the PS3 is a completely different beast to the PS2, and if you want to compare apples to apples, then the Xbox 360 is positioned similarly to the PS2 and the PS3 is similar to the original Xbox - cheap, less powerful hardware with more games versus more expensive, more powerful hardware with less games. Will we ever see the mass upgrade of PS2s to PS3s? I think many of these people have already “upgraded” to the Xbox 360 as they were waiting for the PS3 to come down in price (or improve in title availability). Will they buy a PS3 as well? Maybe, or maybe they will buy a Wii instead. While I think Sony’s strategy is still safe for the time being, you cannot market the PS3 as a premium piece of equipment because people don’t really care about that, people just want good games at cheap prices. If anything, the Wii has been marketed is the exact opposite of the PS3, cheap hardware, but fun. When I think the PS3, I think superior Blu-ray player and multimedia hub, not a console you associate with “fun” (even the sleek black design doesn’t say “fun” to me, it reminds me of the monolith in 2001 to be honest). And with the economy the way it is, people are looking at saving money, not spending more even if it is a superior piece of kit.

Speaking of the Wii, it continues to do well, and I don’t think this holiday period will be any different when it comes to demand (so get your orders in now while you still can, and don’t get left out like the last two holiday periods). The real success story of this year (and the last) has to be the Wii, because without a huge array of hit games, and without constant price drops, it has managed to remain top of the sales charts by a considerable margin. The ‘funness’ I alluded to earlier, and the fact that it isn’t expensive to start with is what I think has made it a success, and if anything, the downturn in economic conditions might help it sell more at the expense of more expensive consoles (mainly the PS3, as the Xbox 360 has become even cheaper).

Moving on to software sales, the Xbox 360’s lead over the PS3 means it continues to do well whenever a big multi-platform game is released, and this month, it’s Star Wars: The Force Unleashed. The Wii continues to do well of course, but even though it has more hardware in people’s homes than the Xbox 360, serious gamers (those that spend serious bucks) are still the ones with Xbox 360’s it seems. The PS3 had the poorest result of the year I think, with only a single title in the top 10, and that was Star Wars. Overall, 45.1% of the top 10 sales belonged to the Xbox 360, the Wii was close behind on 40.3%, the PS3 far behind with only 9.8% and a single PS2 title rounding off the month. Here’s the complete list of the top 10 software sales:

1. Star Wars: The Force Unleashed (Xbox 360, LucasArts) - 610,000
2. Wii Fit w/Board (Wii, Nintendo) - 518,000   
3. Rock Band 2 (Xbox 360, MTV/EA) - 363,000
4. Mario Kart w/ Wheel (Wii, Nintendo) - 353,000
5. Star Wars: The Force Unleashed (PS3, LucasArts) - 325,000
6. Mercenaries 2 (Xbox 360, EA) - 297,000
7. Wii Play w/ Remote (Wii, Nintendo) - 243,000
8. Madden NFL 09 (Xbox 360, EA) - 224,000
9. Star Wars: The Force Unleashed (PS2, LucasArts) - 223,000
10. Madden NFL 09 (PS2, EA) - 158,000

The next month should see an increase in sales all around, but I suspect it will be the same as this months in terms of the ranking, the Wii ahead by quite a bit, the Xbox 360 following with the PS3 third (in between are the portables, while the PS2 is sixth). Common sense really. See you next month.

As expected, my refurbished PS3 arrived this afternoon. The turnaround was a bit slower this time, two days shy of 2 weeks, but I’m not complaining.

Opening up the package, the first thing I noticed that it wasn’t packed very tightly, as the PS3 could move around inside the box slightly. Not a good sign. The second thing I noticed was that the PS3 case wasn’t snapped in properly at one end (front, right hand side was popped up). This is easily fixed of course, just apply pressure to pop it back in, but again it’s not a good sign.

Starting the PS3, doing all the usual set up stuff, the freezing problem (right after the Sony Computer Entertainment fanfare music plays) is still present - it must be something to do with certain settings or something, but I did a quick system restore (not the full one), and it seems to have fixed the problem. The PS3 came with firmware version 2.42, so I’m a little bit afraid. I’m also afraid to update to 2.50, due to the various problems that have been reported so far. I think I shall skip using the PS3 much until 2.51 comes out and people have volunteered to be guinea pigs for it.

I did notice that, unlike my last refurbished PS3, the fan noise is more smooth. The last one had a creaky fan which I did not talk about, it sounded like it needed some oiling. The problem with refurbished PS3s is that you don’t know how it has been used by the previous owner, and while the faulty parts were replaced, the parts that aren’t faulty (but have been used near to death) are still in there. I much prefer Microsoft’s repair policy, where they try to repair your own console before giving you a refurbished one.

So wait I shall for 2.51, which means there will be at least one more post in this series of blog posts. Hopefully, that one will be the last one, because my warranty runs out next month and even if it didn’t, I don’t know if I want to go through everything again.

Update: Bad news. The wireless remote/controller drop-out problem has happened again, and what’s worse, plugging in the controller doesn’t work anymore. I had to do a soft reset, but the PS3 refused to reboot (the green light keeps on blinking), and so a hard reset was the only other choice. Not surprisingly, everything worked again after the restart. I’m not updating the firmware to 2.50, since I have nothing to lose anymore (and Sony tech support will probably ask me to do it anyway). I think I might have to send in my PS3 again. Damn.

My PS3 is on the way back to me. Again. Hopefully this one is fully working. The 2.50 firmware came out too, I don’t know if it fixes the disc read error problem that 2.43 seems to either create or make an existing problem come out. There are early reports that the 2.50 firmware is borked too, but more on that later.

I wrote a mid-week blog on the status of Blu-ray, so some of the news stories that I will cover in this WNR will have been covered by that blog entry already.

Let’s start with copyright news. Actually, there weren’t that many, other than the fact that EA continues to disrespect their own customers by sayings that nobody gives a damn about DRM. Other than the thousands and thousands of people who have protested and many more that have deliberately pirates your software as a protest. The Pirate Bay copyright trial is set to start in February 2009, this one should be interesting.

Some of the licensing that Blu-ray hardware requires

I’ve talked about the cost of Blu-ray DRM licensing before, and it was interesting to hear Apple CEO Steve Jobs talk about it as one of the reasons why Macs don’t have Blu-ray support yet (more on the Blu-ray no-show in Mac later on). Could the BDA be digging their own grave with their greed over DRM (and other types of) licensing? AACS, BD+, BD-J, Dolby TrueHD, DD+, DTS-HD … the licensing costs do add up, and each disc, player or software sold has to pay licensing fees. Blu-ray hardware prices will come down if unlicensed players start to flood the market, which is what happened with DVDs when the Chinese manufacturers started doing their thing. The BDA has been working quite hard to prevent Chinese firms from making Blu-ray players probably for this very reason, but in these harsh economic times, the extra cost of Blu-ray manufacturing and production may be very hurtful for the fledgling format.

Onto HD news now, as mentioned earlier, the rumours of Blu-ray coming to the Apple Mac and giving Blu-ray a huge boost of confidence proved to be false. Not only that, Steve Jobs actually called it a ‘bag of hurt’. Ouch.

No Blu-ray on Apple Macs ... yet

Before people accuse Apple being anti Blu-ray, Apple is actually an important member of the BDA and sits on their board of directors. Of course, Apple have their own agenda in regards to iTunes and movie downloads, but Apple is said to have worked closely on the Blu-ray specs, and also had a hand in crafting the HD DVD specs through their involvement in the DVD Forum. But the fact remains that adding Blu-ray to Apple Macs is a costly proposition at the moment, possibly another $300 in hardware and licensing costs alone, not to mention the need to upgrade QuickTime to play Blu-ray movies. Steve Jobs also talked about waiting for Blu-ray to take off before burdening customers with the cost, and that’s true. How many people actually have Blu-ray movies right now? And how many want to watch them on Macs? How many people even watch DVDs on Macs?

And even though Apple’s can’t play Blu-rays, the new MacBooks will now feature accelerated decoding of H.264, one of the major video codecs used by Blu-ray. This should pave the way for eventual Blu-ray support.

DISH 1080p: competition to Blu-ray?

There’s a lot of competition for Blu-ray these days, despite HD DVD dying. Toshiba still wants to beat Blu-ray, but using upscaled DVD instead (which was their original plan before HD DVD). This article talks about it, but what I found most interesting in the article were the Blu-ray hardware figures for Australia. Apparently, in Australia, only 17% of HDTV owners have Blu-ray players. Out of these, only 7.5% are standalone players, the rest being PS3s (I don’t know if these figures count all PS3 owners as Blu-ray owners, or just the ones that use it to play Blu-ray movies). In other words, only 1.3% of HDTV owners in Australia have Blu-ray standalones. Then there’s DISH Network’s new 1080p service, which early reviews have suggested that it equals Blu-ray in terms of quality. You remember a couple of weeks ago that the BDA threatened to sue companies that used the term “Blu-ray quality” to describe their VOD and subscription services. Maybe those claims weren’t so exaggerated, because in the end, it’s just an issue over bandwidth - 40 Mbps will give you Blu-ray quality video and audio. 

Last week’s Iron Man led surge came to an end, nearly, this week. The Nielsen VideoScan stats for the week after Iron Man showed a 46% drop for Blu-ray sales due to Iron Man sales falling away (DVD sales recorded a smaller, but still significant 17% drop). Predictions are still saying that Blu-ray sales will significantly grow in the next four years, with annual hardware sales set to jump to 40 million if the predictions are true. This means Blu-ray hardware will have to sell 8 times the current figure for this prediction to come true. Easy!

And so we come to gaming. A new PS3 (and PSP) firmware was released during the week, version 2.50. When I first posted the news, I warned people to wait before updating as new firmware will usually introduce more problems than it fixes (wait for the eventual .01 incremental updates to fix these problems). I was right, as the 2.50 firmware introduced quiet a few serious problems, such as the B(lack)SOD problem after the firmware update, B/W video playback problem and a few other things. There are probably solutions or work-arounds for most of them, but it’s probably safer to wait for 2.51 which I’m sure will be released soon if the problem identified are serious enough. I must say that Sony’s handling of the PS3 firmware updates haven’t been exactly up to standards that people expect. It’s great that they’re updating the PS3 constantly to add more value, but it’s another if it breaks people’s PS3s because the firmware haven’t been properly tested (and they can’t possibly be, not in the relatively short time-spans between updates).

The new Xbox 360 Experience is coming in November ... if you've got enough space to install it

Speaking of updates, the Xbox 360 is about to have a major one next month, probably the largest since the Xbox 360 launched due to the launch of the new dashboard interface (to compete with PS3 Home, no doubt). The disk space requirements for the new update is quite big, 128 MB or more, and many people just don’t have that much space, especially if they have Core/Arcade versions that don’t come with HDDs. Spotting this potential problem, Microsoft has done the right thing and will give away free memory units and give heavy discounts for HDDs to people that don’t have them. This should help the Xbox 360 build up some momentum for the holiday season, and if the September NPD figures are anything to go by (huge jump in Xbox 360 sales, beating the PS3 quite handsomely), then it could be a good holiday period for the 360 in a year that hasn’t been that great. The full NPD analysis will be posted early next week as usual.

That’s it for this week I think. No, let me check again. Yep, that’s it. No more. All done. Were you expecting more? Were you disappointed? That’s a shame, and I am sorry about it all. Oh well, let’s hope next week’s a bit better.

There has been a lot of stories recently about how well/badly Blu-ray is doing, and I thought a post on it to clarify a few things.

There seems to be a lot of negativity surrounding Blu-ray at the moment, which is strange because Blu-ray has just had it’s best ever week in terms of sales, thanks largely to the release of Iron Man. Before we get to the negativity, let’s have a look at the Blu-ray sale stats from Nielsen VideoScan for the “Iron Man Week”:

Period: Week ending 5th October
Top 20 Sales (by disc volume): 13% of market (87% for DVDs)
All sales (by dollar volume): 15.68% of market (84.32% for DVDs)
Total Sales: $26.84 million

The above figures are impressive because if you’ve been keeping track of the Blu-ray sales stats as I’ve posted them in the forum, then the top 20 sales (by disc volume) averages around 8%, and the all sales (by dollar volume) is around 7%. That’s almost double of what normally happens, and it’s all due to one title (the second most popular title on Blu-ray for that week sold 7 times less than Iron Man). With 13 to 15% of the market, either by disc or dollar volume, that’s pretty impressive for a format that’s really only started to compete about 6 months ago (when Toshiba called it a day on their HD DVD format).

Steve Jobs: No to Blu-ray ... for now

So why the negativity? Well, this last week or two, two pieces of news stories did dampen the enthusiasm a bit for Blu-ray. One was Microsoft saying once again they have no plans to add Blu-ray support. This isn’t a big deal really, because the PS3 is the best console/player for Blu-ray, and the Xbox 360 with add-on drive won’t be able to compete on quality or even price. The second piece of bad news, and this is a big one, is Apple’s Steve Jobs calling Blu-ray a “Bag of Hurt” and wanting nothing to do with it until “things settle down, and waiting until Blu-ray takes off in the marketplace before we burden our customers with the cost of the licensing and the cost of the drives”. The high licensing cost of Blu-ray has always been a weakness of the format, but to hear it from someone like Steve Jobs is something else.

So how is Blu-ray doing actually? If I had to give Blu-ray a report card score, then I think at the moment, it gets a solid C, maybe a C+. Why the pessimism, you ask? Well let’s just go through them.

First of all, while the Nielsen VideoScan figures, for the Iron Man week at least, is looking great, those stats are a bit misleading (aren’t they all!). Note that the top 20 sales figures are denoted in disc volume. This favours Blu-ray slightly because Blu-ray sales fall off quite rapidly after the top 20 items, in fact, or sometimes as in the case of Iron Man week, fall off after the number 1 item (7-to-1 sales ratio between Iron Man and second place Forgetting Sarah Marshall). DVDs, on the other hand, is almost the opposite, with most sales coming from the bottom end of the sales charts due to discounting and the larger catalogue of movies.

And if you then look at the all sales by dollar volume figures, that’s misleading as well. Blu-ray movies are priced higher than DVDs, usually $2 to $3 higher than the premium DVD version (2 disc collection, for example), and up to $10 higher than the budget DVD version (single disc version). And so if you compare dollar volumes, then Blu-ray can sell less discs, but still have the same dollar volume as DVDs. And considering that many older DVD releases are on sale for under $10, and that Blu-ray has no titles in this price range, it further favours Blu-ray.

The best way would be to compare disc volumes only, because that’s the only way we can see if Blu-ray is successfully replacing DVD as the home video format. For whatever reason, these stats are not available, or not published, and so an educated guess (not including the Iron Man week stats, which might be a one-off) would be that if Blu-ray holds about 7% of the home video market by dollar volume, then it would translate to perhaps about 5% to 6% by disc volume. That’s not too bad, but for a format that has been the sole HD disc format for 6 months already, the gains, if any, are small to say the least.

DISH 1080p: competition to Blu-ray?

But while Blu-ray has no HD disc format competitors, it does have competition in general, and not just from DVDs. High definition downloads and subscription television are becoming more widely available. While normally A/V quality from these services cannot be compared to Blu-ray, a recent review of DISH’s 1080p service did say they the differences were small. And of course, downloads have the convenience of not having to have a physical disc collection, which while being attractive to many people (me included), does not have the convenience of a digital media collection (and full quality Blu-ray managed copy is nowhere in sight). A VOD type service would be allow for greater access to a larger collection for many people, and traditional non-interactive cable services with 1080p would be cheaper than building a large collection, especially if you only watch movies once.

Then we have DVD upscalers, which can already do a decent job of getting faux HD to your HD panel, and Toshiba’s innovative work on improving upscalers even more so with new techniques. In other words, competition is plenty and one gets the sense that Blu-ray doesn’t have a whole lot of time before it has to establish itself as *the* format for HD. Recent figures in Australia showed that only 17% of HDTV owners had Blu-ray players. The heavy reliance on the PS3 as a Blu-ray player is also shown in these figures, with only 7.5% of Blu-ray players being standalone types (the rest are all PS3s).

And the economic problems don’t help, of course.

But it’s not all doom and gloom. The holiday shopping season is just around the corner, Blu-ray hardware prices are falling already in anticipation, hit titles such as The Dark Knight and WALL-E are coming soon as well, so Blu-ray might just have a holiday season to remember. The timing may not be great, but Blu-ray needs to do well in the next few months and if it can, then its future will be safe.