HD DVD and Blu-ray drives cost over US$400 to build

Research firm In-Stat has released a report that looks at the potential market for the two battling next-generation optical formats: Blu-ray and HD DVD. And they’ve revealed that building both HD-DVD and Blu-Ray will cost over US$400. Along with the hardware, the $400 price-tag will also include paying for the royalty licenses for the codecs. Although the bill of materials, does not accurately tell you the price, since hardware bought in wholesale would be cheaper, it presents a guideline on what to expect.

Also, it’s going to be much more expensive to manufacture a Blu-ray player than a HD-DVD player. Recent examples include Toshiba’s HD-DVD Player, HD-A1 which will retail at $499, while Samsung’s BD-P1000 will retail at $999.

At this point, things look bleak, with the extremely high prices of the players, plus the confusion and incompatibility in standards, and slow sales of HD TVs. The high cost of these players also presents a challenge for Sony, who will be bundling a Blu-Ray player in its forthcoming PlayStation 3. Further, Sony is increasing speculation by denying rumours that the price of the PS3 will be between 499 – 599 EURO.

Frankly, this whole episode looks like a repeat of the VHS vs Betamax episode. Neither of the two groups are willing to forfeit anything for a settlement. Although this might be a problem for the customers, it can only harm the big companies in the long run.

Research firm In-Stat has released a report that looks at the potential market for the two battling next-generation optical formats: Blu-ray and HD DVD. And they’ve revealed that building both HD-DVD and Blu-Ray will cost over US$400. Along with the hardware, the $400 price-tag will also include paying for the royalty licenses for the codecs. Although the bill of materials, does not accurately tell you the price, since hardware bought in wholesale would be cheaper, it presents a guideline on what to expect.

Also, it’s going to be much more expensive to manufacture a Blu-ray player than a HD-DVD player. Recent examples include Toshiba’s HD-DVD Player, HD-A1 which will retail at $499, while Samsung’s BD-P1000 will retail at $999.

At this point, things look bleak, with the extremely high prices of the players, plus the confusion and incompatibility in standards, and slow sales of HD TVs. The high cost of these players also presents a challenge for Sony, who will be bundling a Blu-Ray player in its forthcoming PlayStation 3. Further, Sony is increasing speculation by denying rumours that the price of the PS3 will be between 499 – 599 EURO.

Frankly, this whole episode looks like a repeat of the VHS vs Betamax episode. Neither of the two groups are willing to forfeit anything for a settlement. Although this might be a problem for the customers, it can only harm the big companies in the long run.