Another proprietary, super-secure Sony format bites the dust. Only a year after PSP's U.S. debut, and despite the device's overall success (28% market share by year-end 2005), the UMD movie format is dead in the water. Two major studios have stopped shipping the format, and Wal-Mart is yanking it off the shelves.
Why? Because no one is buying them. Let's take a look at the feature set, and see what's behind this malaise:
- Lower quality than DVD (let alone Blu-Ray/HD-DVD)
- DRM'ed up the wazoo (neither rippable nor writeable)
- Can't be viewed on a TV screen
- Can't be played on a device other than PSP
Wow, who wouldn't want to buy one of those at $15 a pop? Let's take a look at emerging consumer trends in the video space, and see how the UMD fares:
- Increasing quality demands
- Ripping, burning, remixing
- Burgeoning home theater market
- Focus on universal formats
The real question is, how many proprietary formats does Sony have to burn through before it realizes that "synergy" between its filmed entertainment and consumer electronics divisions doesn't mean using one as a hammer to drive consumer adoption of the other? Outside of the magic Apple kingdom, that kind of strategy just doesn't fly any more (and even Apple is now supporting Windows on its hardware).
Then again, Sony's got a lot of smart people working there. Maybe the strategy adds up over the long term. Let's see. If each failed format represents $100M in lost revenue or sunk costs, and each successful format represents $2B in bonus revenue, and they only succeed one out of ten times, they lose (10 X $100M = $1B) total and win (1 x $2B = $2B) total, which means they net a healthy profit of $1B for all their troubles. Even if that's true, though, is the net gain worth pissing off countless consumers, retailers, content providers and hardware manufacturers? Sure, a buck's a buck, right?
Ironically, this move will probably boost the value of UMD movies among a small enthusiast community, thanks to the sudden drop in supply. Guess I'd better start hoarding them for my wife, who's a PSP junkie.