inquisity

Two days ago Wal-Mart, Best Buy, and Netflix announced they will no longer carry HD-DVD players and products. Many have predicted that the “format war” is in its final stages. Not one day after, Toshiba announced that it will no longer produce HD-DVD players. The consensus is in: Blu-Ray has won.

So what exactly has Blu-Ray won? Yes, HD-DVDs will most likely go the way of Betamax (the alternative to VHS in the 80s). Blu-Ray will now be the only choice in the “next generation” of digital video.

But that’s not going to mean anything.

There are huge number of obstacles before Blu-Ray will succeed. First, Sony (the principle investor in Blu-Ray) needs to figure out how to sell us that buying a Blu-Ray disc is better than downloading the movie (legally or illegally). Second, unless you’ve bought a top-of-the-line TV in the last year or so, you can’t even take advantage of the higher video quality offered by Blu-Ray.

Ok, so this is true about most new electronics – people are slow to adopt a new, costly technology. I’m not the first to draw these conclusions. But there’s something missing from the analysis of the next-gen video market: Blu-Ray is simply more than we want.

Do this: next time you’re in an electronics store, find the Home Theater section and look at a Blu-Ray display (Best Buy will usually have a good one). The quality is simply too much. The movement of the actors is abrubt like a British comedy or Soap Opera. For some reason, it actually looks like a lower quality video than normal TV shows or DVDs.

Yes, Blu-Ray has incredible detail compared to DVD, but the movements on screen are awkward to the eye. I’ve noticed this in multiple movies. It’s easiest to see when watching a movie with lots of quick movement like Spider Man 3.

So while I’m not surprised Blu-Ray has won the format war (better brand, sexy new technology), it will ultimately fail to be profitable (which, remember, is the whole point here – to make money). I don’t see consumers switching to Blu-Ray unless DVDs are no longer made. It seems that Sony may have, for the second time, invested in a failed format. Only this time, it may lose out to an older technology.

I noticed that Dell has decided to abandon its direct-sales model that it has been using for 10+ years. Now, instead of buying a Dell from www.dell.com or one the phone, you can stop by your local Best Buy and pick one up:

I’m skeptical about Dell’s move to sell in retail, which has been tried before and scratched due to low profit margins. One of Dell’s biggest advantages was using a just-in-time (JIT) inventory system, meaning it only ordered the parts to make your computer after you had paid. This allowed Dell to keep minimal inventory on hand at any point in time.

In the computer industry, this is a huge advantage. Because computer hardware is becoming faster and cheaper at an exponential rate, computer manufacturers have to keep offering the latest and greatest at competitive prices. If HP, for example, overestimates demand and produces too many desktop computers, they either become obsolete in a few months, or have to be sold at a reduced price (and for less profit or even a loss). Dell minimized this problem by only ordering what was needed.

Best Buy is certainly the best retailer to choose, but now Dell is competing in-store with the likes of Apple, HP, Compaq, eMachines, Gateway, Acer, and others, who have much more marketing experience in the retail arena.

When testing out names for my blog, I tried possible domain names by simply typing them into the address bar of Firefox (a domain name is something like www.google.com or www.yahoo.com). Domain names tell your browser where to find a website like Google. The following day, I discovered that some of the domains which previously had been available were now taken by place-holder sites. You know the ones I’m talking about, where it’s just a skeleton page with some random links on it and a “search” field. Someone had figured out that I was thinking about buying that domain name and purchased it before me, and now wanted to “negotiate” a price (much higher than the normal price, of course).

Apparently this practice actually has a name: Domain Name Tasting. When you initially purchase a domain, you have a 5-day grace period where you can “return” the domain for a full refund. This policy was originally intended to protect consumers from accidentally buying the wrong domain due to typos or other mistakes. Certain enterprising individuals have figured out a way make money through this loophole by automatically buying domains that are searched for or typed into browsers and earning advertising revenue from page visits.

Currently it’s a legal practice, but Google is fighting back by not including these sites in AdSense results. The idea is to prevent people from earning money off the practice, effectively eliminating the market. ICANN, the organization that oversees these kinds of things, is looking into the matter.

In order to minimize the chances of this happening to you, see if domains are available through sites like godaddy.com, and buy them immediately if they are. Nothing is worse than finally coming up with a good name and then having someone “steal” it from you.