M+E Daily

At Blu-Tech Summit: Apps Provide New Marketing Momentum for Blu-ray

by Marcy Magiera

UNIVERSAL CITY, Calif.— Apps are poised to increase the interactivity of Blu-ray and provide new marketing momentum for the format, said a panel at Blu-Tech: The Blu-ray Innovation Summit held here today.

“Second screen” apps to access features on Blu-ray discs—such as Sony Pictures Home Entertainment’s “Smurf-o-Vision” feature for “The Smurfs”—were much discussed for their ability to increase consumer interaction with BD movies through the tablets and other mobile devices that are currently growing like wildfire.  “Smurf-o-Vision” is a free app exclusively Apple’s iPhone, iPad, and iPod Touch.

“Second screen is the hot topic, the way to get BD going again,” said Sven Davison, VP of production for 1K Studios/Cinram, who added that traditional features are not the potent selling points for discs that they once were.

With BD Live and apps together, “Consumers will see more Internet-connected features with BD,” said Charles Potter, VP of product development  and creative services for Sony DADC.

“Tablets are delivering on the promise of BD Live,” said Andrew Carlson, executive director of interactive media at New Wave Entertainment.

The term “second screen” is one consumers are becoming familiar with, panelists said, though they emphasized that engaging entertainment experiences are more important to consumers than the technology with which they are delivered.

“Consumers are actually getting it,” said Tracey Garvin, senior VP of worldwide marketing for Sony Pictures Home Entertainment, of the term “second screen.” Sony touted its second screen features in marketing and press materials for “The Smurfs”; other studios, including Disney, have also done so.

That said, panelists stressed that consumers don’t care about features such as second screen capability or UltraViolet, per se. “The creative experience is what matters to consumers,” said Cory Watson, executive director of interactive media at New Wave Entertainment.

Speaking separately, Jim Bottoms, director of Futuresource Consulting, predicted that “apps will be a very, very important distribution medium for movies,” as he presented research on “The Consumer BD Experience.” In addition to adding new excitement to BD, “social networking and apps will help drive online video revenues,” he said.

Futuresource projects that online sales and rentals will account for 30 percent of home entertainment revenues by 2015, about equal with BD, at 29 percent. Pay TV video-on-demand and DVD will split the rest of the market at 21 percent and 20 percent, respectively, Bottoms said. In 2011, DVD still represents about half the market.

BD player sales, meanwhile, will grow to 19.2 million units annually in 2015, with PlayStation 3 sales adding another 700,000 units that year, Bottoms said. At that point, Futuresource expects household penetration of BD players to be 53.2 percent, with penetration of PS3 at 10.3 percent. This year, BD player penetration will be 25 percent and PS3 penetration 14 percent, he said, with 14.2 million BD players and 3.2 PS3 units sold in 2011.

Bottoms said that BD needs more support and education on an ongoing basis to continue robust growth. “Blu-ray represents the circle of life for the video industry,” he said.

Other key challenges include consumer education about UltraViolet, which studios see as a way to boost electronic sell-through with consumers who so far have demonstrated a preference for online movie rentals; and continued investment by broadcasters in 3D content to drive consumer uptake of 3D HDTVs. Within the next three years, virtually all TVs sold will have 3D capability, Bottoms predicted.

In a discussion on “Blu-ray and the Cloud,” Steven Chester, VP of film for Akamai Technologies and Brad Collar, senior VP and general manager of Global Digital Media Exchange, talked about the common file format to be introduced for downloads as a potential game changer for UltraViolet. The common format will reduce download distribution costs for studios and provide them more control over video quality and feature sets, while providing a very strong value proposition for consumers because it will make purchase downloads interoperable with a large number of devices, they said.

In the case of both UltraViolet and apps that interact with BD, conference participants characterized the technologies as full of potential, but just beginning their life cycles.