DVD Intelligence

Jean-Luc Renaud

• Jean-Luc Renaud is Globalcom Ltd founder and managing director, publishing www.dvd-intelligence.com – a premier source of news, data and analysis for DVD professionals and publishes the DVD Primer (now in its 7th year).

• Jean-Luc has been involved in various aspects of the new media industry for over 25 years, and presents with wit and knowledge.

DVD Intelligence

Jean-Luc Renaud• Jean-Luc Renaud is Globalcom Ltd founder and managing director.

He has been involved in various aspects of the new media industry for over 25 years. After graduating from the universities of Lausanne and Geneva, in Switzerland, he earned a Ph.D. in the United States where he lectured. Jean-Luc co-authored The Future of the European Audiovisual Industry while a Fellow at the European Institute for the Media in Manchester. He worked as a senior consultant at Logica, the UK's largest independent IT company before setting up Globalcom Ltd to carry out consultancy assignments and develop the company's publishing activities to which he now devotes most of his time.

• Globalcom launched www.dvd-intelligence.com – Europe's premier source of news, data and analysis for DVD professionals. It also publishes the DVD Primer (now in its 7th year), the Filmmakers' Guide to DVD, and organises the annual Film-to-DVD Seminar in London

DVD Intelligence

Jean-Luc RenaudEditor & Publisher

Duplicators in a DVD marketin development

IDDA presentationLas Vegas, 10 May 2005

www.dvd-intelligence.com

DVD Intelligence

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DVD Intelligence

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DVD Intelligence

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Falling DVD-Video prices1998-2003: –30% 2003-2004: –13%

DVD Intelligence

500-1,000 discs. Migration to (more expensive) fully automated networkedindustrial strength multi-drive autoloaders + quality recordables not thatcheap + replicators have learned to do short run more efficiently. BUT duplicator’s shorter turnaround time always an advantage.

material price reduction makes short run (DVD-R) economically viable.CD/DVD up to 1,500 units viable.

several 1,000s. CD-R with thermal printing is less expensive than mostruns of a few 1,000s replicated discs.

a client order 10,000 pieces, saying duplication is faster and just aseconomical as replication.

Cheaper machine + cheaper media = dangerous. CD/DVD reject 30-40%.Costly time wasted. Little thought given by small/office duplicators.Nightmare with tight deadline. Laborious job requiring expertise.

encourage customer to look for professional, high-quality, fast service.

With duplication machines coming down in price and running faster, how big can “short runs” be and still be economical?

DVD Intelligence

very short turnaround time.

value-added services (personalising, serialising, high-end copy protection).

With basic laquer-coated CD-R combined with silk-screen printing,1,000-10,000 CDs selling costs match replication costs.

requirements will also exist for both. One won’t eliminate the other. Big volumes will always require replication.

yes for corporate sector. Not for music, movies, game, software.

better, faster machines push the limit.

late arriving master + short time = choice for duplication. When no time tocreate glass master + replicate + print, get duplication job of up to 7,000pieces.

Takeaway discs. Live event, mobile dupe units.

Independent filmmakers. Film-to-DVD distribution using alternative routes.

Any chance to see duplication ever replacing replication, and for what type of jobs?

DVD Intelligence

Direct-to-DVD opportunities

+ +

+ = $ £ ¥

DVD Intelligence

today: very low-cost fast inkjet printing, much cheaper digital printsolutions, hi-def formats, opportunities in flash memory. Tomorrow: theInternet, ‘which will probably rubbish most of our business models as theyexist today’.

more affordable Flash USB drive might replace CD duplication for marketingmaterial, on the long terms.

Holographic Video Discs (HVD), HD-DVD, Blu-ray

continued growth of online delivery, downloading, web distribution.

opportunities in duplicating solid state memory card or flash cards

What technological change do you see coming on the horizon that will impact on your business?

DVD Intelligence

installing silk-screen line and advanced assembly/packaging equipment toremain cost competitive with replicators in these areas.

Always offered turnkey solution to customers. It offsets declining mediaprices.

multimedia, web programming. CD/DVD duplication came as value-addedservices. Subcontract larger runs to replicators.

fulfillment, graphics and authoring services.

opportunity for clients to place their material into ‘customer store’. No guarantee of sales, but welcome exposure.

getting closer to end users, trying to win creative work, helping with contentor artwork. Developing specific solutions to assist launch and/or futuredevelopment of a product.

One-stop shop is the rule of the game for replicators. In what areas, if any, are you expanding your service offering?

DVD Intelligence

whatever new things we try, we think first Internet: marketing, community,uploading masters and artwork, ordering, order enquiring.

in development. Currently used as marketing tools and for exchangingproject file (proofs, content, etc) with clients.

use web to attract customers, disseminate information. Will add automatedonline disc creation through a 3rd party provider.

“same as everyone else”.

maintain website, aggressively push it into search engines using webprofessionals.

in the middle of developing one. A solid, well thought-out one is way to thefuture.

No clearly defined strategy yet.

partnering with clients, showcasing works/services

Do you have an Internet strategy, if so what is it?

DVD Intelligence

they are becoming more involved in our turf and associated activities.

consolidation is unfortunate development, leading to cross-subsidisation.

Replicators start offering duplication, inevitable path. But this presentsopportunity for joint-venturing with them.

50% say hold/drop prices. Not able to recoup costs increase.

raw materials +capital investment costs up, cut back expansion plans.

will have to invest in hi-def formats.

next consumer move could be in portable video devices, not hi-def.

online downloading + video-on-demand competition.

one-stop shop, into duplication, price dumping.

Because of ever smaller margins, replicators consolidate and diversify. How do duplicators face them?

DVD Intelligence

downloading DVD-type material still slow, unreliable. No impact soon.

requires high-speed + better wireless network tools to move forward.

viable online delivery will produce shift in disc pressing, not decline.

in paperless society, the paper pulp industry is stronger than ever!

must already impact as per-pay-view is already available.

5+ year for significant negative impact.

downloading music has pushed up sales of CDs. Easier to get a movie ondisc than download and burn one. Not much impact on our business.

downloading DVD-quality material not yet there. Compete with HDTV

package makers is most creative, competitive disc industry sector

When do you estimate that online delivery will start to impact negatively on packaged media and, therefore, reduce the demand for disc replication and duplication?

DVD Intelligence

DVD is de facto home entertainment platform for 10-15 years. Online, flashmemory may complement.

will come, but don’t know when. Solid state memory won’t replace DVDbecause of manufacturing costs.

another 5+ year

10-15 years as per media manufacturers, testers, authoring houses,distributors.

if optical media follows path of audio cassette, will remain around for manyyears in commercial, industrial, training, educational fields. Videotape is stillfairly strong.

As storage media moving to Terabytes, discs will be around for a long time.

What do you think will be DVD’s lifespan before it is replaced by online delivery and/or solid-state memory cards?

DVD Intelligence

following the industry, update our equipment as needed. No format preference as long as the industry can decide on a single standard.

will equip with what industry decides.

a lot needs to happen. Industry, corporate sectors need to embrace HD discs for us to make a move.

too early to say, too many variables to make predictions.

manufacturer push or consumer pull?

quantum leap? For whom?

more than two formats in competition

display is growth engine

What will it take for your company to get into duplicating emerging higher-resolution discs?

DVD Intelligence

High resolution media

Blu-ray <50GB/side Sony, Philips, Pioneer + 100

HD-DVD 20/40GB Toshiba, NEC + 100

FVD 6GB/11GB Taiwan’s ITRI

EVD 9GB China

VMD 20-100GB New Medium Enterprises

HVD 1,000GB (1TB) Optware + alliance