http://columbiatribune.com/2007/Apr/20070417Busi012.asp

Since the advent of Napster and digital music in the mid 1990’s, CD sales have decreased dramatically, declining in accelerating amounts since 2003. Now, with videos and movies becoming increasingly available over the Internet, will a similar decline in sales of DVD’s be observed? Already Wal Mart provides a digital video download service, allowing users to directly download movies that are available at the Wal Mart stores. Similiarly, Blockbuster plans to unveil a “digital rental service” by the end of the year. With faster, fiber optic Internet connections poised to become the norm, downloading a 700 Mb movie to a personal computer will take under 10 minutes, far less than the time required to drive the local Best Buy and purchase a DVD, and comparable to the download rates of music back before broadband Internet became widespread. With down-loadable movies becoming increasingly easier to obtain, the only question that remains is if it will eventually become the technology of choice, supplanting new HD-DVD/Blu-Ray and replacing DVD storage all together.

While other services providing down-loadable movies have been created, the adoption of this technology throughout the network has been slow. However, now with companies like Wal Mart and Blockbuster adopting the technology as well, the “celebrities” of the video retail networks have entered the equation. Both Wal Mart and Blockbuster control sizable market shares and thus have many “in links” into their network. With that in mind, the only thing preventing the spread of digital media is the users willingness to adopt it.

To “switch” to Hd-DVD/Blu-Ray technology, one will have to put front the cost for purchasing an HD-DVD/Blu-Ray player. The Blu-Ray/HD-DVD combo players that are on the verge of entering the market run will cost from 300 to 1000 dollars. With the S-video input common on even the most basic new TV and computers, the cost of playing a digital video is simply whatever Radio Shack is going to charge you for the S-video cable and perhaps a sound wire so that the video does not have to play off of your computer speakers. All told, such products will run someone about 20 dollars. Thus, with the adoption of down-loadable movie technology by the “celebs” of the industry and the much easier means with which someone can “upgrade” from DVD’s to this new technology, we should see a rapid network cascade in which Blu Ray and HD DVD’s go the way of the 8 Track and Beta.