Even though the economy reeled and consumer confidence plunged, DVD remained a strong category for retailers last year.
"The bad news is that sales were slower than anticipated," said Bill Cubellis, Sony's component A/V solutions marketing director. "Also, lower prices may be good news for consumers but it's difficult for manufacturers to make a profit."
To offset the issues of price compression, manufacturers coming into CES 2002 were adjusting their lineups with new value-added features including DVD Audio, SACD and combination DVD/VCRs. Meanwhile, new features a year ago, like mp3 playback, and CD-R and CD-RW compatibility have become virtual standards.
This year's mix will include many more progressive scan models at lower price points and the addition of higher-end units that will play discs using either of the multichannel music formats — DVD-Audio or SACD — and in some cases both.
Reid Sullivan, Panasonic Entertainment Group general manager, said he expects DVD sales to reach 12 million decks and portables for 2001; and predicts 15 million units in 2002.
With close to 25 million DVD households this year, Craig Eggers, Toshiba product management director, said "We're starting to see two or more DVD player households." Second player purchases often include the latest step-up features, manufacturers add.
The following is a glance at some of the major DVDs suppliers were planning to discuss at CES:
Apex is following up its sub-$100 DVD player with one of the first DVD players to support both multichannel Super Audio CD (SACD) and DVD-Audio. The AD7701 also has progressive scan capability and is compatible with mp3, WMA and Kodak PictureCD files. The company will also set a new low price benchmark for the unit at a $349 suggested retail price.
Steve Brothers, Apex sales and marketing senior VP, said the company was targeting limited quantities by Christmas with a larger rollout early in 2002.
"We look at SACD and DVD-A like a Beta/VHS situation. We do not want customers to choose one format or the other with the possibility that one might go away. We feel the consumer should be able to buy any disc they want, regardless of format," he said. The company will also offer a $199 progressive scan player with 3:2 pull down and Kodak PictureCD compatibility.
Denon believes there is life for DVD players above $500, according to Steve Baker, Denon's VP of sales and marketing. They won't be in K-Mart or Wal-Mart but Pro Group dealers do a good business in this category. "We delivered the DVD-1600 ($499) with progressive scan and multichannel DVD Audio in February and it did enormously well. The $800 DVD-2800 has been backordered since January 2001. It has a Silicon Image SiI503 progressive scan engine that's been favorably compared with boutique players that cost thousands," he said.
New for Denon at CES will be the DVD-3800 ($1,200) with the latest SiI504 engine, improved filtering and DVD-Audio for $1,200. It's due in March. Also on display in the South Hall is the high-end DVD-9000 THX Ultra certified player with the 504 engine for $3,000.
Panasonic promises "significant expansion" of its model offerings with more options for dealers including both black and silver color schemes with thinner cabinet designs, said Sullivan. Silver models appeal to new digital TV set purchasers, he said. The brand will ramp up its offerings of five-disc changers and progressive scan models, including a new $179 MAP entry model.
Also slated are more DVD-Audio compatible models, including a multi-channel DVD-Audio deck with progressive output at a $279 suggested retail price.
Philips doubled its DVD market share in 2001 by pushing new styling designs and CD-R/CD-RW and MP3 playback compatibility, said Steve Jean, Philips DVD product marketing manager.
Philips will continue to have close to 12 SKUs in 2002 with emphasis on higher-end features in more affordable price points. The company plans more models with Faroudja progressive scan technology and SACD compatibility this year.
Philips will show a multi-channel SACD/DVD player for $299 with a black finish targeted to music enthusiasts. The $599 silver finish step-up will add progressive scan and Faroudja technology and is geared to Home Theater enthusiasts.
Jean expects Philips to have one of the highest concentrations of progressive scan players in 2002. The opening price point will be $169. Also new will be Windows Media playback capability.
Pioneer plans to introduce its first multichannel DVD-Audio/Video and Super Audio CD player under the Elite brand. Model DV47A is also slated for March at a price to be announced, although Pioneer assured that the cost would be significantly lower than the current $5,000 Elite AX10, which offers multichannel DVD-Audio but only two-channel SACD output.
Samsung said its restructured distribution and increased DVD SKU count paid market share dividends in 2001, and "while other companies were dropping price points, we held ours," stated Claude Frank, Samsung senior marketing manager.
In combo products, Samsung is upgrading its DVD/VHS line with the DVD-V2000 and DVD-V2500. Both new combos play VCD/CD/CD-R/CD-RW/MP3/VHS and S-VHS while the DVD-V2500 adds an HDCD decoder, a Memory Stick interface, Picture CD viewer, progressive scan output and a crystal mirror display. The DVD-V2000 ships in March at $299 and the DVD-V2500 ships in May at $349.
The company will show a combination DVD player and hard disc video recorder (DVD-H40) featuring progressive scan output. The deck incorporates a 40GB HDD that can store up to 5,000 digital music files. It also features EZ Time Shift to pause and replay live broadcast TV programs. Included are a Memory Stick interface for digital photo playback and MP3 audio files. It ships in June at $699.
Samsung's high-end DVD player — model DVD-HD1000 — will play DVD Video and DVD Audio files, and includes a unique 720p/1080i High Definition Output. The unit also outputs 480p and plays HDCDs. The DVD-HD1000 will ship in May at $1,999.
Sony plans to hit all the key categories at CES including single disc players and changers and will make a new style statement, according to Cubellis. Sony will continue to trumpet SACD-capable DVD players. The new transportable DVP-F41MS will be aimed at teen-agers and college-age consumers who want a certain level of customization in the look of their products. It is also the first DVD player with Memory Stick capability. Consumers will be able to use the player to view digital stills and videos on the TV screen.
Toshiba was well positioned in 2001 to capitalize on the MP3 and progressive scan trends.
Craig Eggers, Toshiba product management director, said the company was one of the "first to talk about progressive scan DVD," adding it has become an important driver for HDTV-ready sets. "It's like fries with a burger. It's a perfect complement," he said.
For 2002, DVD-Audio will play a larger role for Toshiba. In November, they delivered the SD4700 and SD5700, the company's first DVD-A machines. At CES, the company will unveil the SD-2800, a new leader (silver or black finish) that is basically the SD1700 with MP3, a new carousel with MP3 as well as the SDV-280 DVD/VHS Hi-Fi combo, the SDA-300 DVD/TV-Internet device and an integrated DVD/receiver with five speakers and a 50-watt subwoofer.
Also slated is a new dual deck VHS/DVD player (model SD-V280), featuring silver metallic styling, MP3 playback, zoom and marker functions for DVD videos and a four-head Hi-Fi VCR. It will ship in March at $299.
Toshiba was also planning a second portable with an 8.9-inch screen and a TV/FM tuner, and will showcase a prototype DVD-RAM/DVD-R/HDD recorder to gauge dealer reaction. It's currently available in Japan for $2,499 and has an 80 gig hard drive.
Thomson Multimedia will be coordinating its product lines with a common aesthetic due late in the first quarter.
"MP3 is very important to us and every model will have MP3 playback," said Randy Staggs, Thomson video product planning general manager. Staggs expects growth in progressive scan and said his company will add units to the current model it now offers.
Vialta, which recently launched an interactive DVD player that connects to the Internet for a wide range of features and functions, will show its next-generation ViDVD Player, model 330, which adds progressive scan playback capability. The player also offers compatibility with music CDs, MP3s with ID3 tag support, digital photos including Kodak Picture CD capability and Karaoke with CD+G support. It includes dial-up and broadband Internet access, a Compact Flash card reader, and is slated for a spring introduction.
Yamaha will debut the DVD-C920 high-end DVD changer featuring "intelligent" progressive scan output and 3:2 pull down conversion via a one-chip solution.
Highlights include 54 MHz video bandwidth, 10-bit video DAC, compatibility with CD-R/RW, DVD-R/RW/+RW discs, ability to play MP3 files, Yamaha patented PlayXchange technology, and Cinema Image and Cinema Dialog for optimized music viewing and listening. It ships in late February at a $599 suggested retail price.
The company will also show its flagship CX1 DVD changer. Features include "intelligent" progressive scan output. The CX-1, which ships in February at a $1,299 suggested retail price, also offers onscreen menus and icons, still picture function, programmed and random playback, parental lock function and extensive digital and analog output jacks.
Zenith will show at CES a DVD/VCR combo unit, and four DVD players — two single-disc models in standard-only and progressive scan versions, and two five-disc DVD changers in standard and progressive scan versions.
The top-end five-disc changer will be Zenith's first player to incorporate DVD-Audio compatibility.