El Cheapo Blu-ray player could spark price erosion

By Patrick Avenell

In a worrying sign that the price erosion of Blu-ray players has escalated, JB Hi-Fi’s latest catalogue is listing a no-name player for under $300.

It was reported on Current.com.au last month that the big players in Blu-ray, especially Sony, were targeting Christmas 2008 as the tipping point for Blu-ray acceptance in the marketplace. The thinking behind this strategy was that the price point was finally more consumer-friendly, with the major players (Sony, LG, Samsung and Panasonic) all releasing entry level models in the $400 to $500 price range.

Trouble therefore looms for this strategy, with the Soniq-branded Blu-ray player being sold at JBs skipping the $300 range and moving straight to $299. This announcement is described as a “Price Breakthrough!” in the catalogue; a surely accurate description.

Highlighting just how much value could be stripped from the market by this development are the advertisements for the name brand Blu-rays in this category. On the same page as the Soniq model is a Samsung player for $388, a Sony for $391, an LG for $446 and a Panasonic Blu-ray recorder for $1,791.

The big names here will all be clinging to the hope that whilst the Soniq model gets the punters into the store, adept salespeople will be selling them up to the name brands. This is an eminently possible scenario, and one which should be encouraged in all categories in all stores. The road to hell is paved with good intentions, however, and this could lead to a near opposite: price slashing in order to remain price competitive.

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