Philips Australia predicts that DVD recording technology will hold 50 percent of the DVD home entertainment market by the year 2004.
The prediction comes at a time when the company has aggressively cut the price of its DVD recorder, the DVD-R 1000, by 36 percent from AU$4,699 to AU$2,999. Prior to today's announcement DVD recorders retailed between AU$3,800 and AU$5,000.
Philips said that observers shouldn't let current prices lead them to be overly sceptical about the claim. Philips marketing manager, Jonathon Wight expects the price of DVD recorders to erode at least the same rate, if not higher, than VCRs.
"VCRs started at a comparable price point of AU$2,500 when they first entered the market," said Wight.
Philips has a track record for making predictions in conjunction with product launches. Last March the company publicly predicted that DVD technology would replace the VCR within three years, in conjunction with the launch of the DVD-R 1000. However, recent industry statistics contradict that claim.
Retravision's unit sales figures for 2001 indicate that the VCR sales volumes grew 17 percent over the previous year despite ceding market share to the newer disc-based technology.
Refuting the retailer's statistics, Philips said that demand for VCRs in major retail channels is falling. Quoting wholesale industry data, Philips said orders fell from 1.12 million units in 2000 to 998,000 in 2001, representing an 11 percent year-on-year fall.
Philips spokesperson David Wolf conceded that the 'sell-in' figure didn't reflect the number of units sold but said "it's pretty close to it because retailers don't keep a lot of stock on hand".
The same set of industry statistics for DVD players indicates a 106 percent year-on-year increase in retail demand, from 249,000 to 514,000 units.
