Touch & Go

We are doing everything online these days, aren't we? At least, it feels that way. Soon every single aspect of our lives will require us to be tethered to an ephemeral network or we simply will not be able to function. These days it seems that the physical world is becoming less and less important to modernity.

It hasn't, but it sometimes does feel like it. In fact, there have been plenty of changes afoot to bring things a bit more in line with where we should be. It's just harder to notice in the fog of social media, 24/7 news assault, and endless automation of smaller jobs. Things are changing, but not quite in the way we see it changing, as is usually the case.

Even though a lot has changed over the last few years, one thing that absolutely hasn't is the existence of the physical market. Particularly in the arena of movies, disc releases still exist and have only grown in the wake of the recent pandemic and rise of customer-last services such as streaming. People still value the sensation of touch.

This is a bit strange, considering you would have figured the opposite would have happened, especially with less releases of new Hollywood product. But the niche still continues to thrive regardless of what the machine does.

For the most part, you will always have folks that will jump on the most convenient, low effort way to enjoy something, which explains the popularity of streaming over technical improvements such as 4K. However, what is surprising is that despite the hard push from corporations to get these customers to own less and pay constant rental fees for everything they're interested in (and not interested in, to be honest) physical media ownership still exists. Even despite a situation where most people couldn't leave their homes for over a year, never mind go out themselves and watch or buy new movies, they still continued to buy physical objects to own.

A bit unexpected, to be quite honest. From everything that has happened, one would have figured the previous trends of increasing online product would have continued unabated. Yet it looks like for many the opposite occurred.

Take this article about the state of the newer UHD (Ultra HD) format and its bid to seize control of the physical market since its inception nearly half a decade ago. It doesn't seem to be grabbing hold or doing much to attract customers. In fact, DVD sales are still the highest among all physical formats even 25 years after their creation.

Check the chart:

Amazing, isn't it? The cheapest, most disposable form of physical media is still the majority market share to this day. That doesn't look to be changing anytime soon.

But it feels like there is a divide between different sorts of customers. Whether it is those who just want to simply own the product, those who want the best possible presentation, and those who want the best of both worlds, the majority consensus seems to be that outright owning the product is more important than any other aspect of it.

In other words, it is about the experience more so than the bells and whistles surrounding the movie. Not much has changed in the last quarter of a century for a lot of people aside from widescreen TVs. And not even large ones.

The above chart might be confusing to those who value giant 4K television sets and a small library that has no potential to reach the spread of those on lesser formats like DVD or even standard Blu-Ray. This is understandable. Why wouldn't anyone want to pay more for higher quality, even with a library that will never reach the depth and variety of those that came before?

Why indeed.

"With the competition between streaming services intensifying, it’s easy to forget there’s still a market of consumers who buy physical media, who like to collect tangible things, for a variety of reasons including pride of ownership, wanting to actually own things, fear of tampering by content owners. Is it niche? Not quite. It’s shrinking for sure, by double-digit numbers annually, but it’s still a mass market. What’s niche perhaps is the premium segment of this market – Ultra HD Blu-ray, a 4K HDR disc format introduced 5 years ago this February, 10 years after Blu-ray Disc and 20 years after DVD. It’s likely the ultimate video disc format. 

"Nielsen VideoScan, a company of the NPD Group, has since years been collecting retail sales numbers of consumer purchases in the U.S. market. I’ve tracked those numbers the past few years and they show a couple of interesting things."

For a newer format, UHD has never pierced double digit market share, and has already fallen under what it was three years ago. Meanwhile, standard Blu Ray has fallen to a quarter of the total market share, while DVD owns nearly 3/4s of the home market! Even after 25 years, DVD still reigns supreme over it all.

"First a note of caution, though. The past year has not been a normal year for a lot of things, including entertainment spending. Expenditure on streaming services has increased at an accelerated rate while spending on physical media has not. But there’s more. Because of covid measures, Hollywood studios have had to halt movie production for months. Moreover, because of lockdowns cinemas and movie theaters have had to close for extended periods of time. This dearth of theatrical releases has translated into a complete stagnation of home video releases a few months down the line, still observing the traditional windows in the staggered releases schedules. The sell-through video market is, or at least used to be, driven by such new releases. That’s the main reason why 2020 was not a great year for movie sales, and it has exaggerated certain trends."

This is a fair assessment, but what also should be taken into account is that the modern movie industry was already flatlining before the pandemic ever started. Sales had been going down for years, and movie theaters were already seeing worse and worse returns. All the last two years did was hasten that demise faster.

The #1 appeal of buying big 4K TVs and players that blow up picture on them is for newer movies, but new movies don't really sell all that much anymore. Most people interested in them will just watch it on a streaming service. UHD was never going to be much more than a niche in a niche. And it looks like the trends are bearing that out.

"The most interesting trend in my view is what’s happening to Blu-ray Disc, the 1080p HD disc format: it’s getting squeezed between DVD and Ultra HD Blu-ray. It’s clearly visible in 2020 but if you look back a little further you can see this happening more or less from the introduction of UHD BD. The split between DVD and BD was about 50/50 (in units) before UHD BD launched. This was as far as Blu-ray Disc got in trying to displace DVD after reaching maturity. It had been on the market for ten years by then. 

"This squeeze makes sense, of course. DVD is the cheapest option here, and price does matter. Ultra HD Blu-ray meanwhile is the best format in terms of audio and video quality. Blu-ray Disc is neither. It’s a decent compromise between price and picture & sound quality but it’s neither the cheapest nor the best. It’s less and less a compelling proposition. That UHD BD would mostly cannibalize BD was to be expected: The people who want the cheapest option and still haven’t upgraded to BD more than 10 years after introduction are likely to stick with DVD while those who want the best quality migrate from BD to UHD BD."

Unfortunately, this is cope. Standard Blu Ray being down a quarter comes from not much being released that takes advantage of the format over the year. It certainly isn't losing any ground to UHD when UHD has also plunged in numbers and is now under 5% of the market share without ever reaching double digit to begin with. Not to mention, Blu Ray is the best quality when you are not buying or using 4K, as most buyers still do not.

And they probably never will, especially when using it locks out much older material that cannot be released for it. Physical media buyers, from what it appears, heavily invest in old film and television. SD content that cannot be upgraded to HD (of which there is more than you realize) can not be released on UHD or displayed on 4K TVs as they simply cannot display SD. For certain audiences, this is an obvious downgrade, and denying that is part of the above blind spot.

But tech heads tend to overlook the past to their own detriment. This isn't really a new thing, but expected at this point.

Plus, and I hate to say this, but UHD will always remain a niche in a niche. Whereas one can release SD material on Blu Ray (I would suggest looking up Discotek's anime work bringing works that aren't HD out in higher quality), only a small sample can be upgraded to 4K, and even fewer of those will make enough money to justify the exorbitant expense of making a UHD to begin with. If you're planning on leapfrogging over Blu Ray from DVD then you will miss out on a plethora of material the more expensive format of UHD will never, and can never, have. Audiences apparently seem to notice it, hence market share already shrinking.

UHD is a niche of a niche and doesn't have much in the way of growth potential, especially as newer products interest customers less and less. It's exclusively for tech geeks.

Such people usually don't even understand DVDs' continued popularity after a quarter of a century in use. Shouldn't it have been replaced like VHS was?

Well, it simply isn't that simple.

"Every week when I post the weekly market share pie chart on my UltraHDBluray tweet feed, someone – in shock about the high market share of DVD – will ask “who still buys DVDs?” Well, a lot of people, is the answer. And who can blame them? Evidently the movie business and CE industry have not done a good job educating people about the differences between DVD and BD (never mind UHD BD) and persuading them to go for the premium option. These differences go further than just image resolution. Take frame rates for instance. Most DVDs contain interlaced video. The format can support progressive video but not at the 24fps frame rate that most movies are shot at. (For an explanation of the importance of frame rates, see this article on HFR.) Dolby Atmos sound and its competitor DTS:X are exclusive to Blu-ray Disc and its 4K sibling, though much more common on the latter. And naturally 4K resolution and HDR (High Dynamic Range) video are only available with Ultra HD Blu-ray."

There is this constant tendency among aficionados of some space of another to miss the forest for the trees, and the above is a clear case of that happening. The reason DVDs remain king is fairly obvious to anyone who understands art, and it has nothing to do with being uneducated. It comes from not caring about aesthetic improvements over price.

DVD was an objective step up over every format that came before it. Multiple languages, subtitles, sharper picture and sound, more disc storage, easier case storage, and it was not very expensive even at release. Tied with that is that it came included in the highest selling video game system of all time: the PlayStation 2. It was such a clear, cheap, and easy, upgrade that the public went for it almost right out of the gate. No one really thought twice about it. VHS sales plummeted almost immediately once the price came down and the PS2 was released to massive success. It was no wonder DVD was king for so long afterwards.

So what is Blu Ray's advantage over DVD? What does it do that is the equivalent of the huge improvement over VHS? What does it have that will make buyers jump for it as readily as they did for DVD back in 2001?

It does the same thing that made DVD what it is, but it does them better and it's pricier.

That's it. 

Sorry to tell you this, but that's not impressive enough to most people. Most buyers don't care about slight improvements to audio or visuals--they care about having a good reason to jump ship to a new format. I'm sorry to tell you this, but Blu Ray (and especially UHD) give no compelling reason for most people to drop their old format unless they care deeply about picture, storage, and sound. Most do not and never will. Hence why surround sound audio and 4K TVs are not owned by everyone on your block. It doesn't matter to them.

UHD suffers this issue twice over because those who collect Blu Ray already think it's enough of an upgrade, which it is if you're one of the many people who see no value in 4K, or exchanging SD entirely for a small slice of the pie in content. So you're seeing a fraction of a fraction here. Would another format after UHD occur it would then bite into UHD's already tiny percentage. It wouldn't effect the "lesser" formats. Less people care the more into the minutiae one gets. This has always been the case regarding tech. It is why most avoided the internet until 56k modems and Windows 95 became prevalent. They don't need good; they need ease of access.

Normal people are more likely to find streaming more of a revolution over UHD, and their assessment wouldn't be wrong from their perspective. "Blu Ray but better" is even less enticing than "DVD but better" when you can instead click a button to watch whatever you want at any time. The ease comes before quality.

"Another reason for the continuing success of DVD is that while just about everything gets released on DVD, that’s not the case with Blu-ray (let alone 4K). Nowadays, many TV series – even those that were broadcast in HD – are released only on DVD, not on BD. As for Ultra HD Blu-ray, many new movies get a release on the format but TV series rarely do. Also Netflix originals that are shot and streamed in 4K – series like House of Cards, The Crown, Jessica Jones and Daredevil – get a BD release at best. The only exception to that rule so far has been Stranger Things, but that 4K disc release has been a retailer-exclusive only available through U.S. chain Target."

And after five years UHD has never even risen to where Blu Ray was after the same amount of time, never mind DVD. Audiences need a bigger reason to jump ship. But they are never going to have it, especially if they care about old works.

I should go into this a bit more. There are certain things 4K TVs cannot ever do, despite supposedly being advanced. One of them is displaying any form of Standard Definition content well. They literally cannot do it.

What should also be mentioned is that most television shows were filmed on video, not film. Video does not have the materials in order to be given higher definition like film does. It can't. This means they will never be upgraded to HD, and a DVD release is the best they can ever hope for. This goes the same for a lot of things that were edited on tape too, such as properties like Mighty Morphin' Power Rangers. They will never have a HD release because of the way the elements were put together or edited.

The best one can hope for is an SD on Blu Ray release (there are no improvements except less compression than a DVD disc has), which sort of defeats the selling points of Blu Ray to begin with and is not enough of a selling point for audiences.

And on a 4K TV? It will always look like garbage and run considerably worse. There is simply too much of a benefit for DVD's continued existence when a lot of things would lose physical releases should it happen to go away. In many ways, DVD represents the entirety of the physical market, which means it cannot die or else the market will too.

It also goes without saying that streaming services will just throw old series and films up as is, because picture and sound quality isn't its selling point. If it looks bad, just hop to another one. After all, you're paying for ease of access, not quality.

"Some Ultra HD enthusiasts frequently suggest that movie studios should stop releasing DVDs, apparently thinking that consumers would then upgrade to higher-quality formats. I don’t expect that would happen. The cost-conscious DVD buyers would more likely switch to streaming options. Studios would be crazy to stop the cash cow that DVD still is. And it provides essential volume for the optical disc replication plants, of which there are fewer now than during the peak days of CD and DVD, to keep running at a decent load."

I'm always fascinated with this obsessive cult-like frothing demand that normal people acquiesce over the demands of fanatics who should be allowed to consume in peace. This is a reoccurring theme, isn't it?

Let us be honest, if DVD disappeared, audiences wouldn't be jumping to UHD. Some would go to Blu Ray while the wide majority would just be pushed faster into streaming. The wider public doesn't care about 4K when they barely cared about HD to begin with. They just want the product, and they want it cheap. UHDs will never be cheap or have the wide spread that streaming offers. As far as the wider audience is concerned, it's worthless.

I say this as someone who enjoys standard Blu Ray more for its storage capability and uncompressed SD content than anything else. It's a good format, but it's not any sort of revolution. UHD even less so due to have objective steps back in the are of art preservation that no tech head wants to admit is a fatal flaw for many. It will simply never become the majority format.

"The modest rise in market share for Ultra HD Blu-ray will likely resume when blockbuster titles are getting released again and movie business returns to normal. The best weekly market share for the format so far was when Avengers: Endgame was released: 20%. Blu-ray Disc did nearly 50% that week – also a great score. Major titles have been few and far between since the pandemic struck. The only real tentpole title has been Tenet. It sold 38% in 4K in its premiere week (pushing the format’s market share to 6.6% – above average for 2020) and around 25% in the weeks following."

I'm going to throw an opinion out there that new movies do far better on streaming than UHD, while new releases of old movies and obscure releases do far better on standard Blu Ray (based on comments from boutique distributors like Discotek, Vinegar Syndrome, and Kino Lorber), while DVD is a catch all for everything else. There are segments where certain things are simply preferable to others. These are obvious audiences sectors that have easy to understand preferences.

If you ever think UHD, a format the majority of video products can never be released on, will ever be the go-to physical platform, then I think you might be blinded by the bells and whistles over the buyers' preferences. If it ever is the standard, then we will lost a lot of films and TV series to the void. This is not a good thing.

However, this is a baseless fear because it's never going to be more than a niche of a niche. That's what it was designed to be. It's only ever going to appeal to a minority.

"The hardware market indicates that Ultra HD Blu-ray is a stable niche. The number of players sold is shrinking slightly. It’s also telling that while Samsung has actually withdrawn from the disc player market altogether, the other major CE brands Panasonic, Sony and LG have not introduced new models lately and continue to sell existing models, apart from the just announced Panasonic DP-UB9000 Mk II. Cheap, low-end, no-brand competition from China, that became massive with DVD, has not entered this market. Instead we’re seeing high-end boutique brands entering, again indicating this market is becoming a premium collectors business rather than a mainstream one. Industry watchers also predict a wave of ‘clones’ of the beloved universal disc players that Oppo made."

Case in point.

It's the same people buying more UHD, not more people buying into the format. It's already stagnated in growth despite being around for over half a decade. By this point in their lives, DVD and Blu Ray had already taken off.

"The installed base of UHD BD-capable players is sure to rise massively this year thanks to the introduction of PlayStation 5 and Xbox Series X. Discless “digital-only” versions of both consoles exist – the Microsoft one is called Xbox Series S – but millions of players will be in households in the course of this year. These devices are foremost games consoles but statistics show that console owners use the devices for many forms of entertainment including music, movies and series. A lot of that may happen in the form of streaming but the option is there. Will this impact the sales of movies on Ultra HD Blu-ray a lot? Not before major movies see releases on home media again. Once that returns to normal we may see higher volumes of discs selling than before."

If the mega-successful PS4 didn't cause Blu Rays to overtake DVDs, why would newer consoles be able to do it with UHDs? The people who buy consoles would probably just jump over to streaming since, you know, all the streaming services are right there on the console. It's PC gamers who care about tech. The audiences for consoles care more about accessibility which, as we've already discussed, is what this group cares for more.

So no, the PS5 and Xbox S will not give UHD much of a boost, especially when both Microsoft and Sony are swinging hard for the digital distribution fences. They will push streaming services long before even considering expensive movie discs.

There isn't really any potential growth in this sector of the physical market because most people just want the product for as cheap as they can get it. Better picture and sound is not going to impress them. We've long since reached saturation on picture and sound improvements over HD was introduced to the mainstream over 15 years ago. Most people flat out do not care about them anymore. The wow has worn off. What they have is good enough as it is. and that's all that matters.

"At the moment, the worldwide Ultra HD Blu-ray Disc market is worth roughly 1 billion dollars, the majority of it in North America. That may be a niche in the overall entertainment business but it's a sizeable niche with healthy margins. May it live long and prosper."

This is good news if you primarily watch big budget modern Hollywood movies. If you don't then you'll realize that for those who enjoy foreign films, b-movies, animation, old television, or things made or edited on video, have no real place in this market. It's really for big budget, large studio Hollywood releases, and little else.

I think there is a tendency to get carried away by aesthetics or technology at the expense of content. One of the reasons physical media remains popular is because audiences want that tangible connection to their art, to hold and experience on a level they can't with just bits of data. The rental store used to be such a mecca of activity back in the day for a reason. There is something about being able to hold a movie and read the box art that offers something different than scrolling through menus on an internet connection does.

The people who want that, value that experience far more than the quality of picture or sound. To them it is the art itself that matters the most, and they want it however they can get it. Despite changes in the home video market, this doesn't appear to be changing anytime soon. There will always be a segment of the audience that values touch.

And we should salute them for it.

Gone, but never really forgotten.

Nonetheless, the larger point in all this is that there is still a market for physical media. It isn't gone yet. That might change with the next few years, especially as the studios make harder strides towards streaming above all else. After all, no one benefits from it more than they do. Even if it does change, however, there will always be an audience of those who prefer physical media and direct ownership of art and entertainment detached from a nebulous online cord that could be severed at any time. Touch still matters.

Boutique labels are putting out more movies on Blu Ray than they ever have since the format started. We're seeing flicks from the likes of Cannon Films and labels like Vinegar Syndrome putting out even more obscure films that have never gotten good releases before. On top of it, they are also completing unfinished movies for the world to see. There is still a very activity scene thriving for those who appreciate these things.

Right now is probably the best (and will be the last for a long time, to be honest) time to build a library of affordable movies and TV series while the market has some stabilization. Sooner or later, you won't be able to. Time is running out, even if the audience thinks otherwise. This is a once in a lifetime chance.

Until then, we've got plenty of options. Better take advantage of it! Who knows how much time we have left, anyway? Might as well enjoy a good movie while you're waiting. Take your pick. The sky is the limit.

For now!

Weird, wild, and action-packed!