year is near and 2005 is just around the corner. The year 2004 brought us a lot
of improvements in DVD burning and we can certainly say that in 2004 DVD burning
became a common thing to do. Increased speeds and dual layer burners are
probably the most exciting things to mention about the year 2004 but will 2005
be boring? We don't think so! In 2005 we can probably expect the DVD recording
industry to become more and more mature and you, as an end user, will benefit.
Here are our forecasts for 2005.
Increasing speeds
On the
hardware side we'll see that the speeds are going to increase for dual layer and
rewritable media. 16 Speed for DVD-R and DVD+R are said to be the maximum so
we're not expecting that those speeds will increase. We do expect that dual
layer DVD recording will reach 8 speed and it's most likely this will be
somewhere in 2005. The DVD+RW Alliance has already announced that 8 speed
might not be the maximum and 12x could be reality at the end of
2005. Also rewriteable media will be faster in 2005. The first drives
that support 8x on DVD+RW have already been announced and should become
available in the first quarter of 2005. According to the DVD+RW Alliance
speeds higher than 8x could become available at the end of 2005.
Focus
shift
Another trend seems to be
manufacturers are switching their focus from getting large OEM
orders to selling more drives in retail. OEM orders from the likes of HP and
Dell are generally good for selling a lot of drives at once but profit
margins are relative low. In retail the profit margins are higher but they
will require more creativity of the manufacturer. This means special
features both hardware and software wise. Since increased competition in the
retail channels will also put pressure on profit margins the brands will need to
find a way to differentiate themselves in order to be able to ask higher prices.
Creativity and good marketing will be essential.
A good example is
Plextor who are still able to sell their drives at relative high
prices by offering exclusive functionality and by investing in their trusted
brand name. Other companies will probably follow their example and create new
features that are exclusive to them. Also investments in brand names will likely
be required. For consumers this means that their demands are becoming
increasingly more important to the optical drive manufacturers. Companies who
want to differentiate themselves will likely do this by offering software that
works exclusively with their hardware. For example BenQ has already notified
their distribution channel that this will be one of the strategies they will be
using.
Rising star
BenQ is likely to become one of the
most popular PC DVD recorder brands in 2005 and already is rising star. The
company has found a way to offer good quality DVD recording at a good price
and are also starting to release exclusive software with their drive. The
company is in a joint venture with Royal Dutch Philips which is good for a large
amount of patents related to CD and DVD recording.
Due to the increased
retail competition other brands will find it difficult to survive, certainly
those who are not in a joint venture with a Taiwanese or South Korean company.
It would not be surprising if more companies follow Yamaha and Ricoh in
leaving the optical drive market.
Emerging technologies
An interesting technology that should become available in 2005 will be
HP's Lightscribe which allows users to write labels on the
labeling/non-recordable surface of a recordable disc. This technology should
become available in 2005 and is supported by large media manufacturers such as
Verbatim, CMC, Imation, Memorex and TDK. On the hardware side the amount of
companies with a license is relative small but amongst them are large
manufacturers such as LG, Toshiba, Philips and Lite-On. Possibly
Toshiba and Philips will make the technology also available to their joint
venture partners Samsung and BenQ. Also all major software companies support
this technology so it will be the question whether consumers will find this an
usefull technology and of course what will be additional costs for Lightscribe
discs and hardware.
Besides the focus on DVD recording hardware it will
also be essential for DVD recording hardware manufacturers to focus on new
technologies. Japanese giants such as Sony, Pioneer and NEC have already
announced they will shift their Research and Development from DVD recording
to recording technologies utilizing blue lasers such as Blu-ray and HD-DVD.
HD-DVD and Blu-ray players and drives will become more widely
available in 2005. However it will be the early adopters that will start using
the technology and as long as HD-TV and other technologies that require more
storage space are not mainstream. The demand for Blu-ray and HD-DVD will
probably be limited to hardcore users at first. As soon as movie companies are
releasing their content on these discs the players will need to become available
and recorders will follow soon. It will be interesting to see the battle between
HD-DVD and Blu-ray much of it is already going on with press releases that
should convince everyone that the support for their format is increasing and
that they have essential supporters on their side.
However nothing is
decided yet and it is very likely that this format war will dominate the news on
our site in 2005.
Increased software competition
Another
interesting development will be on the software side. Sonic solution has
recently acquired Roxio. Roxio is a pretty strong brand name when it comes to
recording software and for a while it was mainly Roxio and Ahead (Nero) who
where seriously competing. Nero is mainly bundled in Europe while Roxio secured
many OEM deals in the United States. Sonic is also rapidly becoming more and
more popular and has some strong products like Record Now and thanks to Roxio
Easy CD/DVD media. Hardware manufacturers seem to be asking for a lot of
functionality of the software that they bundle with their drives and both Sonic
and Nero now have a wide range of multimedia applications that they can deliver
with drives. However it's a public secret that there are small profit margins on
bundling software with drives so also these companies will need to boost profits
in the retail channels. This will likely result in even more functionality in
their packages.
Another software company that is rapidly growing is
Intervideo. This company started with mainly DVD playing software but has
rapidly expanded their product range with burning applications. It will be
interesting to see whether this company will continue alone, acquires other
companies or gets acquired. Also Cyberlink located in Taiwan, near the large
hardware manufacturers, is rapidly growing. Their focus on home entertaiment and
their product range might also fit nicely in the portfolio of
another company.
It will also be interesting to see how companies that
are making most of their profits from transcoding DVD-9 to DVD-5 will survive.
This year they will probably easily survive but dual layer discs and hardware
will become cheaper, better and more widely available. Will people still use
their software or will dual layer become so cheap and reliable that people will
stop to transcode?
Media improvements
Speaking about dual
layer, as said this technology will become wider available and companies will
make many efforts to make it more compatible, faster and above all cheaper.
DVD-R dual layer will have to keep up with the speed increases of the DVD+R
camp. The media will need to become much cheaper and as soon as the large
manufacturers such as CMC, Ritek and Prodisc will be able to produce these discs
in huge quantities the expectations are that the price of dual layer media will
be slightly higher then single layer media in 2005.
Media overall will
become cheaper and compatibility will be one of the main focus of hardware
manufacturers. At the moment they have to keep up with speed increases but now
we've reached the final 16 speed they can start to focus their R&D to make
as much discs compatible with their drives. Also CD recording started with
compatibility issues of which we see almost none at this time.
An
exciting year coming up, we'll be with you
All in all 2005 will
be an exciting year with blue laser technology as the most important development
to keep an eye on. But it will also be the year that DVD recording becomes
faster, more reliable and cheaper. Expect the companies to fight for your
demands as never before and expect us to keep you updated on it all like we do
for almost 8 years now!
