Why UMD will fail
This past week I launched a couple of movie lists:
I know, this is a game site. But I can't change the fact that I'm still a major movie buff, and I suspect quite a few grownup gamers who read this site are too.
I ranted about HD-DVD and non-anamorphic DVD but only dashed off a footnote about UMD. Frankly (to paraphrase Heathers), this new format isn't worth my Rant. But it is blog-worthy, so here goes.
UMD, as a movie format for the PlayStation Portable, seems very likely to fail. And I'll be there toasting marshmallows.
Not just because I got suckered by Sony on that whole MiniDisc thing. I went into that one with my eyes open. (I actually covered the first U.S. foray of MiniDisc players at CES for ABCNews.com some 5-6 years back.) When I finally bought the MD equipment, I realized full well that I'd probably end up with an orphaned technology. And for years it worked great and I enjoyed it - until the iPod hit and negated the need for me to drag around a bunch of media.
Anyway, UMD is destined for a similar fall as a movie format because it's too limited. You get movies fit for a miniature device that won't play in your living room. And even if they rig up a way for you to hook your PSP to your TV, the picture and sound will be inferior to an equivalent DVD. Since they cost about the same at retail, most people will pass on UMD. The exceptions: rentals and rich kids. I bet airports might even offer discs you can check out, and people with money to burn - well, they'll be all over it.
But that's hardly a successful business plan, now is it?
When I announced the UMD list on DVDFile's message boards, I mentioned how I thought this was a doomed format but it might be fun to watch. Someone posted back an interesting idea: Offer UMD discs for free with DVDs. And I think it's one of two things that might make UMD work. But both approaches are inherently doomed.
The other option is obvious: Drop the price of titles to $10 or less. You're getting less, so you should pay less, right? And, frankly with $5-10 DVDs popping up everywhere (and not just the crap no one's ever heard of), how can UMD sustain such a high price point?
Answer: It can't. It will either fold, or drop in price. And since it's not a mainstream format, Sony's going to have higher costs that won't benefit from economies of scale particularly fast. So the price ceiling is liable to stay high for awhile, or Sony will have to eat the cost on ever title sold. And you don't stay profitable taking a loss on the razor blades when you're already practically giving away the razors.
Offering a UMD disc in the box for free with the equivalent DVD titles is similarly flawed - you're still taking a loss on the UMD media and associated costs like mastering. But it might be a way to put some discs in peoples' hands and get them semi-excited about the format. And Sony's already sort of doing this by offering a UMD version of Spider-Man 2 with the first million PSPs sold at launch.
Anyway, I do think this may be entertaining to watch. If you ever find yourself wondering what studios are supporting this format and which titles are planned or available, check back. I'll hook you up.
-=Gamewatcher
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