For those interested in the evolution of entertainment content standards, word has been floating around the Internet that some big-name retailers are phasing out -- or at least limiting -- their supply of the time-honored VHS cassette. Despite its venerable status, the increasing popularity and maturation of DVDs have long implied that VHS's days were numbered.
According to The Washington Post, among others, Wal-Mart (NYSE:WMT) and Target (NYSE:TGT) will reduce their VHS inventories, which might well be a step toward phasing them out entirely. Some news articles yesterday had more drastic implications of a firmer deadline for VHS's elimination, although today's information suggests a more gradual reduction. Indeed, according to The Post, Wal-Mart's reductions will apparently be tailored to demand in specific stores.
The idea of VHS's slow demise is by no means a new one. Motley Fool Stock Advisor pick Best Buy (NYSE:BBY) and Circuit City (NYSE:CC) already phased out VHS tape sales in light of the DVD format's popularity. (Interestingly, the VHS holdout appears to be movies for children -- parents likely still use older VHS players for their kids' rooms, saving the fancy new DVD player for the family room.)
It's obvious that many factors favor DVDs' complete takeover. DVD player prices have dropped to the point where the expense is nominal. For VHS holdouts, there are also combo DVD/VHS players. I would imagine that most combo unit buyers simply want to watch their existing VHS libraries, rather than buying new tapes. Some, like me, may also want to make room for additional home entertainment devices such as Stock Advisor pick TiVo (NASDAQ:TIVO) recorders, or cable boxes and DVRs provided by companies such as Comcast (NASDAQ:CMCSA).
Meanwhile, DVDs themselves are inexpensive and contain tons of bonus content -- a no-brainer where value is concerned. To me, DVD's ascendance makes the fadeout of, say, music cassette tapes seem slow in comparison. For consumers, saying goodbye to some of these technologies may seem like parting with a tried-and-true friend. But to us investors, decisions like Wal-Mart's and Target's speak directly to good old-fashioned supply and demand, peddling the inventory that's going to move.
Of course, as consumers, some of us may be concerned about even newer technologies poised to disrupt us once again. Much has been made of the warring Blu-ray and HD-DVD formats, both of which promise to one-up DVDs for storage space and video quality.
Will many of us miss purchasing clunky VHS tapes? I think not. The decision by Wal-Mart and Target almost certainly reflects a big change in consumer desire. And of course, with ubiquity comes the promise of the next big thing.
Fast forward to Foolish Takes on Blu-ray technology:
- Think Blu-ray's exciting? Imagine what's next.
- Is a compromise in order?
- Longtime Fool Rick Munarriz bids goodbye to DVDs.
Best Buy and TiVo are Motley Fool Stock Advisor picks. To give more of Tom and David Gardner's favorite stocks a spin, sign up for a free 30-day trial subscription.
Alyce Lomax does not own shares of any of the companies mentioned.
