Toshiba Cuts HD DVD Forecast as Sales Jump

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Toshiba Corporation has announced it is substantially cutting its sales targets for HD DVD players in the wake of lackluster sales figures in the United States. Toshiba says it now expects to sell 1 million HD DVD players in North America by the end of 2007, a substantial reduction from its initial sales goal of 1.8 million players by the end of the year. “Sales in the U.S. have been slower than expected, and we are going to have to lower our U.S. sales forecast,” Yoshihide Fujii, head of Toshiba’s digital consumer business, told Reuters. The cutback will also impact Toshiba’s worldwide sales goals for HD DVD players.

Sony Corporation lost no time in continuing to declare victory for its own competing Blue-ray technology, telling Bloomberg in San Francisco yesterday it anticipates shipments of stand-along Blu-ray players in the United States may jump six-fold during 2007 to 600,000 units. Sony says movie titles exclusively available on Blu-ray will be the deciding factor, with Sony’s Randy Waynick claiming 14 to 15 of the “top 20 blockbusters” were available only on Blu-ray.

Although the Blu-ray camp has maintained the smoldering format war between HD DVD and Blu-ray a done deal for months now, it’s interesting to note even Toshiba’s reduced player sales forecasts outstrip anticipated Blu-ray standalone player sales. However, the market penetration of Blu-ray is currently being driven by sales of the so-far struggling PlayStation 3 game console, which includes a Blu-ray player.

Efforts to increase HD DVD adoption seem to have found some traction, with figures released by the HD DVD Promotional Group showing recent price rebates (which run through June 16) and promotions have pushed a Toshiba HD DVD player to the top of Amazon.com’s DVD player sales, and that HD DVD players now constitute 60 percent of all standalone high-definition players sold. Total HD DVD player sales now total 150,00 units, and the group says consumers bought 75,000 HD DVD movies during the month of May.

“Toshiba’s latest promotional efforts are clearly resonating with consumers and showing that price is king when it comes to hardware,” said Craig Kornblau, chairman of the North American HD DVD Promotional Group. Of course, this week, those Toshiba players will jump back up to $499.

However, overall consumers still seem to be taking a wait-and-see approach to next-generation disc formats: sales figures for both sides in the format war so far aren’t large enough to constitute significant consumer adoption.

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