HD/BD yields

[diogen]

Interesting post by an insider regarding HD DVD and Blu-ray Disc yields
AVS Forum - View Single Post - Insiders Tracking Thread: post it here
to summarize:

HD DVD:
- HD15 and HD30 - above 95%
- Combos - not known (most probably lower)

Blu-ray Discs:
- BD25 - 60-70%
- BD50 - 2 replicators: ~50%; 3 replicators: ~10%
Paramount/Dreamworks used one of the 10% replicators.

Disc making time for HD is half that of BD.

If all this is true, paidgeek lost quite a bit credibility in my eyes
by claiming replication is not an issue and talking about 80% yields...

Diogen.

 

[JoeSp]

And yet we have more BD titles being turned out -- hummm? With all these sources stating all the doom and gloom how in the heck is BD getting any BD titles out at all -- much less be outselling HD-DVD 2 - 1 in the states (3 and 4 to 1 everywhere else on this planet)? Especially since your favorite boy Amir states that there are 100's of DVD plants just waiting to be converted to HD-DVD. What's the problem -- no source content or no buyers? Which is it because to read the bs from all these inside 'sources' - not named of course-- HD-DVD should be trouncing BD left and right -- BUT THEY'RE NOT!

 

[diogen]

With all these sources stating all the doom and gloom how in the heck is BD getting any BD titles out at all...

That is not the question.
The question is how much does it cost and who pays for it.

As to the rest of your post, it was well... worthless rhetoric at best, as most of the time.

Diogen.

 

[navychop]

If it's so low, how come I can buy BD-50 discs at Amazon?

 

[John Kotches]

If it's so low, how come I can buy BD-50 discs at Amazon?

If yield is 10%; you manufacture until you hit your target production runs with usable units which (generally speaking) is 10x. Notice I said if.

If one has a reliably accurate average with a low standard deviation then one could simply manufacture 1 / yield discs to come very close to the right number the first time. Further, assuming the yields provided are accurate to get 1000 usable discs you would need to create:

HD-DVD/15 ~1053
HD-DVD/30 ~1053
Blu-ray/25 ~1538 (midpoint of 60-70%)
Blu-ray/50 ~2000 - 10,000 depending on line.


If we assume that pressing costs are equal (they aren't) and 100% yield is $1.00 / disc (it isn't) we'd end up with:

HD-DVD/15 $1.05
HD-DVD/30 $1.05
Blu-ray/25 $1.53
Blu-ray/50 $2.00 - $10.00

These are dramatic price differentials and it significantly impacts the margin. It is quite possible that Paramount crunched the numbers and found that the bottom line profit (with projected sales) was higher for the next N months (18 I think) with HD-DVD only.

They are a for profit business, right? Sometimes taking a look at the numbers helps to clarify decisions. I have made the assumption (a major one) that the yield rates are accurate; but I don't have any verification on it.

Cheers,

 

[navychop]

So it seems one possibility is that Paramount may not be making a judgment on the winner (or may even think Blu-ray will win). They might have just decided they can sit out a slow growing phase for 18 months, while waiting for yields to increase and costs to decrease. Then jump back in?

A possibility, I suppose.

We can speculate forever, but the next few months will be interesting to watch.

 

[John Kotches]

So it seems one possibility is that Paramount may not be making a judgment on the winner (or may even think Blu-ray will win). They might have just decided they can sit out a slow growing phase for 18 months, while waiting for yields to increase and costs to decrease. Then jump back in?

A possibility, I suppose.

We can speculate forever, but the next few months will be interesting to watch.

There must be something wrong -- you understood my point

 

[CochiseGuy]

So it seems one possibility is that Paramount may not be making a judgment on the winner (or may even think Blu-ray will win). They might have just decided they can sit out a slow growing phase for 18 months, while waiting for yields to increase and costs to decrease.

I dunno, maybe I just a pessimist, but they have been working on Blu-ray since . . . what? 2002? 2003? For a group that so badly want to be the only High Def format you would think they would have yields up over 50% - at best - by now?

Also, as for "all those BD50's on Amazon: The author of that Insider's Post - Dave Vaughn of Home Theater Spot & Ultimate AV also reported to get those yields up to 50%, they have to limit the data to 45GB max. Yields increase exponentially with less data. Since Warner uses the same transfer it uses for HD DVD on BD, probably a bunch of those "BD 50GB" are actually BD 30GB.

 

[John Kotches]

I thought that WB was limiting them all to 25GB so that they could get in a single layer of BD -- but my HTPC is down so I can't check disc sizes.

Cheers,

 

[CochiseGuy]

I thought that WB was limiting them all to 25GB so that they could get in a single layer of BD -- but my HTPC is down so I can't check disc sizes.

Cheers,

HighDefDigest has been known to get tech specs wrong before, but a quick check of recent Warner releases -

Deliverance - 25GB
TMNT - 50GB
300 - 50GB
Purple Rain - 25GB
Out for Justice - 25GB
Blood Diamond - 50GB

So, about half are listed as using BD 50 GB.

 

[CochiseGuy]

Actually I found a great thread in the BD Software form on AVSForum that gives the actual disk size of BD releases:

Title / Disc Size / Video Codec / Audio
300 - 34,803,466,472 / VC-1 / PCM
Blood Diamond - 30,563,539,040 / VC-1 / PCM
TMNT - 15,782,245,616 / VC-1 / TrueHD

ANd for some of those "big" BD exclusive supposedly DL 50 GB release?

The Fifth Element (Remastered) - 38,946,438,756 / AVC / PCM & TrueHD
Chicken Little / 26,222,073,280 / AVC / PCM (16 bit)
POTC 1 / 45,488,139,747 / AVC / PCM (24bit)
POTC 2 / 42,818,592,246 / AVC PCM (24 bit)
The Prestige / 37,697,346,880 / AVC / PCM (24 bit)
Apocalypto / 39,663,765,164 / AVC / PCM (24 bit)
Bridge to Terabithia / 30,245,327,182 / AVC / PCM (24 bit)

Even those releases were specifically encoded to make the maximum benefit of BD 50GB discs - and using space hogging uncompressed PCM audio - I don't see too many pushing the stated maximum of BD dual layer discs.

 

[mike123abc]

So it seems one possibility is that Paramount may not be making a judgment on the winner (or may even think Blu-ray will win). They might have just decided they can sit out a slow growing phase for 18 months, while waiting for yields to increase and costs to decrease. Then jump back in?

A possibility, I suppose.

We can speculate forever, but the next few months will be interesting to watch.

If they are truly getting paid $150 million, then they probably figured they can make more from just the incentive than they could have made from all the discs sold during the 18 month period. It is a great deal, they can still sell into the HDDVD side of things and get a tidy sum for doing nothing on the BD side. If they do their authoring correctly, they can pretty much have all the BDs ready to go once the exclusivity wears off.

 

[JoeSp]

And yet there are more BD titles on the market and more coming then from the HD-DVD side and that is with all these problems. Personally, I don't really care if Toshiba pays Paramount and Dreamworks for exclusivity or the BDA or Sony pays for BD pressing until the yield are respectable.

All I care is that I get great titles on BD and if there are alot of titles out on HD-DVD and I can not stand to wait for them to come out on BD then I will buy a HD-DVD player on the next great offer from the HD-DVD camp --- Ten titles and 50% off the players -- then I will buy a HD-DVD player.

 

[diogen]

...if there are alot of titles out on HD-DVD and I can not stand to wait for them to come out on BD then I will buy a HD-DVD player...

But of course you will...
BD will probably be dead by then, but don't worry, we won't tell anybody what party you were a member of...

Diogen.

 

[chicagofilms]

If the numbers about yields are to be believed, then it seems obvious HD-DVD is ripping off the customers. The movies should cost the same $15-20 a regular DVD costs. Instead, they cost the same as BD.

If they had that much of an advantage in yield, they could sell movies for 1/2 the cost of BD & there would be no war, it would be over.

 

[r.jones1116]

If the numbers about yields are to be believed, then it seems obvious HD-DVD is ripping off the customers. The movies should cost the same $15-20 a regular DVD costs. Instead, they cost the same as BD.

If they had that much of an advantage in yield, they could sell movies for 1/2 the cost of BD & there would be no war, it would be over.

And as more discs are sold, the price will probably come down. DVDs were not $15.00 when they first came out.

 

[diogen]

If the numbers about yields are to be believed, then it seems obvious HD-DVD is ripping off the customers.

I think this signifies the difference how each team appoaches the war: BD lets CE manufacturers make money on players while breaking even (with Sony subsidy) on discs replication; HD lets studios make money on disks while Toshiba swallows losses on players (Microsoft sharing in on 360 add-on).

Diogen.

 

[John Kotches]

If the numbers about yields are to be believed, then it seems obvious HD-DVD is ripping off the customers. The movies should cost the same $15-20 a regular DVD costs. Instead, they cost the same as BD.

If they had that much of an advantage in yield, they could sell movies for 1/2 the cost of BD & there would be no war, it would be over.

Why+

There's more to a discs costs than replication and without knowing what the other costs are it is hard to say what the wholesale cost is.

Now; the other thing is some basic economics. The perceived value of HD content is higher than SD content and that commands a premium as well.

Eventually as someone else pointed out prices will begin to scale down.

Cheers,

 

[CochiseGuy]

If the numbers about yields are to be believed, then it seems obvious HD-DVD is ripping off the customers. The movies should cost the same $15-20 a regular DVD costs. Instead, they cost the same as BD.

If they had that much of an advantage in yield, they could sell movies for 1/2 the cost of BD & there would be no war, it would be over.

Yes, indeed - one could conclude that. And one could also conclude that for BD to be competitive, production is subsidized. And when the subsidy is stopped or reduced, companies such as Paramount stop releasing on BD. If you are in the film industry, do you have any experience you wish to share?

 

[navychop]

If they are truly getting paid $150 million, then they probably figured they can make more from just the incentive than they could have made from all the discs sold during the 18 month period. It is a great deal, they can still sell into the HDDVD side of things and get a tidy sum for doing nothing on the BD side. If they do their authoring correctly, they can pretty much have all the BDs ready to go once the exclusivity wears off.

Yes. At first, I thought that was too long a period to be realistic. But the more I think about it, and read that the "war" has just been extended 18-24 months, the more it makes sense. Of course, after the 18 months, will there be enough capacity to immediately press a bunch of Paramount discs, and will the Blu-ray replicators give Paramount a lower priority after their regular customers- the ones that stuck with them from the beginning?

But of course you will...
BD will probably be dead by then, but don't worry, we won't tell anybody what party you were a member of...

Diogen.

It will be interesting to see if dedicated Blu-ray player sales really are gaining on dedicated HD DVD player sales, and if it continues after this Paramount switch. The Disney Dog & Pony show, and the releases about Blu-ray players during CEDIA should stir the pot a bit. Keeps the rest of the year interesting.