While Lehman analyst Anthony DiClemente expects digital media to thoroughly cannibalize major entertainment company's DVD sales, Disney (NYSE: DIS) still has hopes that interactivity and social media can breathe life into its home video products. In particular, NYT says Disney is pinning its dreams for higher Blu-Ray DVD sales of the forthcoming 50th anniversary edition of Sleeping Beauty by connecting it to a range of features, known as BD Live, including showing friends' instant messages on the same screen the film is playing on. Parents will also be able to program timed messages to their kids that will pop up at a certain point during their viewing. Sleeping Beauty will offer a trivia game where viewers can challenge each other.
-- Dealing with the price problem: Although BD Live, which was developed by Sony (NYSE: SNE), is viewed as key for Blu-Ray's wider marketplace acceptance, there is only one player currently availablePanasonic's DMP-BD50K, which retails for about $800. New BD Live-accessible players will go on sale this fall for half the cost. Still, the price of the Sleeping Beauty Blu-Ray package is $40, almost double the cost of most new DVDs. This all comes as DVD sales experienced their first annual decline, falling 3.2 percent last year to $15.9 billion last year, according to Adams Media Research. Since DVDs can comprise as much as 70 percent of a movie's revenue any drop in sales is big problem for the studios. So while DVD sales continue to be soft in general, Blu-Ray specifically has been showing some signs of life: the format's sales estimate this year is about $1 billion, up from $170 million last year. In the meantime, as more studios bring out their BD Live DVDs, Disney plans a big ad campaign promoting the technology.
By David Kaplan