UHD and HDR: A Dynamic Duo

It takes two — 4K Ultra HD resolution and high dynamic range (HDR) — to create what critics are calling the best home entertainment viewing format yet.

The increased resolution of 4K has found the perfect match in HDR, which offers brighter brights and darker darks and wider color gamut to create a more vivid and lifelike picture.

It’s the closest the home sector has come to matching the theatrical experience, experts say.

“Combined with technological advancements in film mastering and high dynamic range color, 4K is now the de-facto media format you didn’t know you couldn’t live without until you experience it fully,” says Miguel Casillas, SVP of production, home entertainment and digital distribution, at Lionsgate.

“4K HDR has solidified itself, both with consumers and within the creative community, as the best way to watch content at home,” says Jessica Schell, EVP and GM at Warner Bros. Home Entertainment.

Consumers agree that 4K UHD with HDR is a format they can embrace — when the two are combined.

“The resolution doesn’t do it for me but the HDR, the expanded colors, does,” says Adam Gregorich, co-owner/editor at Home Theater Forum, a home entertainment enthusiast site.

“I’m a 4K junkie,” adds Steve “Uncle Creepy” Barton, editor of Brainwavestalk.com, a site for fans of horror and the paranormal, citing the HDR effect. “So much of horror movies take place in the shadows, a lot of details get obscured, but with the remastering, the next richer depth of colors, especially black tones, you can still have that murky, in-the-shadows feeling, but now you can actually see what’s there.”

Home entertainment executives are also seeing promising growth in the market boosted by this consumer enthusiasm. “We’re very enthusiastic about the continued growth of 4K Ultra HD and the unparalleled cinematic experience it brings into the home,” says Lexine Wong, senior EVP of worldwide marketing at Sony Pictures Home Entertainment.

“The 4K ecosystem continues its steady expansion, marked by a host of meaningful advancements over the past year,” says Eddie Cunningham, president of Universal Pictures Home Entertainment. “Across the industry, we’ve seen a surge in 4K content offerings and devices as well as a diversified retail presence spanning both physical and digital customers, powering the format’s notable progress.”

“The growing number of digital providers and streaming devices supporting 4K coupled with robust sales of 4K UHD discs indicates that demand continues to grow for the exceptional home viewing experience that only 4K offers,” says Vincent Marcais, EVP of worldwide marketing at Paramount Home Media Distribution.

By the Numbers

Consumer uptake of 4K UHD TVs is helping to expand the market for content. In its mid-year report, DEG: The Digital Entertainment Group noted that more than 8 million 4K Ultra HD TVs were sold in the first half of 2018, bringing the total number of U.S. households to 38 million. Growth of 4K Ultra HD content is expanding rapidly, according to the DEG, with 344 4K Ultra HD titles available on disc, representing more than $100 million in consumer spending for the first half of the year. There were also 473 4K titles available digitally through the first half. In the same time frame, approximately 1.7 million Ultra HD Blu-ray playback devices were sold (including game consoles).

The Consumer Technology Association expects 1.2 million 4K UHD Blu-ray Disc players to ship domestically in 2018 (39% growth over 2017), which will make up 22% of all Blu-ray player shipments. UHD Blu-ray player revenue will reach $180 million (17% growth over 2017), according to the CTA.

“Consumers’ desire for a premium entertainment experience at home is the sales driver for both 4K Ultra HD TVs and Ultra HD Blu-ray players, which, when used together, provide the very best possible in-home viewing experience,” says Amy Jo Smith, president and CEO of the DEG. “The speedy uptake of 4K Ultra HD displays and devices, combined with the rapid expansion of 4K titles available on 4K Ultra HD Blu-ray and digitally, make it possible for every entertainment lover to find something to enjoy with the richest picture and sound possible.”

“We are very encouraged by the format’s demonstrated year-over-year growth,” says Universal’s Cunningham. “UHD disc sales have doubled from the first half 2017 to first half of 2018 to $100 million in consumer spend and are now capturing a larger share of sales during a tentpole title’s first week of release, accounting for nearly 10% of all new-release sales.

Research also shows that 4K UHD TV households are driving a significant share of digital transactions.”

The new line of 4K TVs, which increasingly feature HDR, are a driving force.
“The TVs are better and better,” says Bill Hunt, editor at home entertainment enthusiast site The Digital Bits. “I’m kind of shocked at how fast they’ve gotten inexpensive. You can get a very credible set for a few hundred bucks. And if you want to spend $1,000 or more you can get a very, very nice set. Prices are getting better and features are getting better all the time.”

“Your bang for the buck goes further now than it ever did,” adds Home Theater Forum’s Gregorich.

Worldwide, Futuresource data shows 4K Ultra HD TV shipments increased by nearly 40% in 2017 and are expected to increase another 33% in 2018. Also, according to Futuresource data, standalone Ultra HD Blu-ray player sales (minus Xbox) are on pace to surpass 2017 by 44%. Meanwhile, 15% of all Ultra HD Blu-ray players shipped worldwide in 2018 are expected to be 4K UHD, with that percentage anticipated to be almost 25% in 2019.

The UHD Blu-ray player installed base worldwide is expected to reach 4.5 million by the end of 2018. Worldwide there are 29 4K UHD BD player models available and 11 4K UHD recorders/players available, according to Futuresource data. Ultra HD Blu-rays are expected to account for 7% of Blu-rays sold worldwide in 2018, rising to 28% by 2022, according to Futuresource.

“The prices have definitely come down to the point where it makes sense to [upgrade your Blu-ray player to UHD],” notes the Home Theater Forum’s Gregorich. “It just doesn’t make sense to not slowly start to make that change.”

IHS Markit anticipates the number of 4K households worldwide will be 188 million by the end of 2018, more than double that of 2016, with the number of households with a 4K TV predicted to grow from 121 million in 2017 to 501 million by 2022, according to the UHD Alliance.

“As consumers continue to transition to 4K, the UHD ecosystem is growing at an accelerated rate,” says UHD Alliance president Mike Fidler. “ABI Research is anticipating 4K UHD TV sales will surpass 102 million, representing 44% of total global flat-panel shipments and Hollywood studios continue to dramatically expand their 4K UHD offerings. And while content from traditional broadcasters remains limited, it remains a critical component of the content universe. In addition, filmmakers, studios and consumer electronics manufacturers are making a more concerted effort to deliver the full capabilities of 4K UHD with more awareness of HDR, wide color gamut, 10-bit color depth and enhanced immersive audio.”

In addition to fostering 4K UHD TVs, Blu-ray players, Blu-rays and other hardware, the UHD Alliance is looking to promote 4K UHD broadcasting.
“From the outset, the Alliance has been focused not only on helping consumers understand the benefits of 4K UHD with HDR, but also on fostering the growth of the UHD ecosystem,” UHDA chairman Michael Zink told broadcast executives at IBC 2018 in Amsterdam Sept. 18. “Broadcast is a critical component of the content universe, and the recent delivery of marquee events such as the Olympics, the World Cup and Wimbledon in 4K with HDR is a significant step toward ensuring consumers get the most out of today’s 4K UHD with HDR displays.”

Content Pipeline

Indeed, content, while perhaps not coming as quickly as the most avid 4K enthusiasts would like, is growing to serve the market, especially for the all-important gift-giving season.

“If you are a 4K enthusiast, it’s going to be an expensive second half of the year,” says The Digital Bits’ Hunt. “There are some really great titles coming that everybody wants to buy.”

In fact, home entertainment enthusiasts are buying 4K UHD titles even before they’ve got the equipment to play them.

“You have to have an HDR set to really benefit from the UHD,” says the Home Theater Forum’s Gregorich. “[But] I’ve seen some people buying in advance. They know they’re going to get the HDR set in the next year, so rather than buy the [regular] Blu-ray Disc they’re buying the 4K UHD Blu-ray so that they can enjoy the Blu-ray now and have the UHD for when they make that display upgrade in the next year or so. So we’re seeing some people do that, kind of future-proofing if you will.”

“I know a lot of guys who don’t even have 4K yet, but will buy the 4K version,” adds Hunt.

“We’re seeing 4K HDR content availability continue to broaden, with not only the latest theatrical new releases, but remastered classics like The Matrix and 2001: A Space Odyssey, as well as TV franchises like ‘Westworld’ and ‘Game of Thrones’ and direct-to-video releases including our DC Universe animated movies, all available or coming soon in 4K HDR,” notes Warner’s Schell.

“I’m excited about 2001: A Space Odyssey,” Hunt says. “That title is going to look amazing on 4K.”

Going into the fourth quarter, the industry is rolling out some of its biggest films of the year on 4K UHD, says Universal’s Cunningham, citing Universal’s Jurassic World: Fallen Kingdom and Mamma Mia! Here We Go Again.

“Consumers can expect Fox’s new releases to be available in 4K UHD with HDR, many day and date, with digital and Blu-ray, such as the upcoming title The Predator,” says Danny Kaye, EVP at 20th Century Fox and managing director of the Fox Innovation Lab. As far as Kaye is concerned, “It’s clear 4K UHD with HDR is redefining the premium entertainment experience.”

“For the industry, it’s important to expand our 4K content footprint alongside our consumer electronics and retail partners within this space; and for the consumer, we are excited to bring favorites such as Hotel Transylvania 3, Sicario: Day of the Soldado and Air Force One to market so that consumers can enjoy them in the highest possible quality,” says Sony’s Wong.

“More than 38 million U.S. households have 4K televisions, and clearly those consumers want to maximize the capabilities of their home entertainment systems, so Paramount is committed to delivering an array of titles to fill that demand,” says Paramount’s Marcais. “From enduring classics like the Jack Ryan films to contemporary blockbusters like Mission: Impossible — Fallout, fans can enjoy a diverse slate of movies from Paramount in 4K.”

Home theater enthusiasts are taking notice of the plethora of releases in 4K UHD.

“I like the fact that we’re seeing almost all big titles as day-and-date UHD releases,” says the Home Theater Forum’s Gregorich. “I like the fact that a lot of studios are going back and releasing catalog. I mean you’ve got Paramount doing all the ‘Mission: Impossible’ movies. You’ve got ‘The Matrix’ collection coming out. You’ve had titles like Die Hard come out, so the fact that we’re seeing studios go back to catalog and release those films in 4K HDR is a good thing, and I’m finding that despite the fact that I swore Blu-ray would be it, I’m rebuying and replacing Blu-rays with UHDs.”
Gregorich is looking forward to the fourth-quarter sales.

“I’m very interested to see what’s going to happen with Q4 and Black Friday with the format,” he says. “I was actually sort of surprised at the number of UHD deals on Black Friday last year, and I’m really interested to see what we’re going to have on Black Friday this year. I was surprised at the number of $10 UHD discs last year at both Best Buy and Amazon. I did a lot of catalog catchup then. Hopefully, we’ll see something similar this year.”

Physical, Digital and Looking to the Future

Industry pundits agree that the physical disc is still the best way to watch 4K UHD with HDR.

“Home theater enthusiasts, serious film fans, cinephiles, they want stuff on disc,” notes The Digital Bits’ Hunt. “The guys who have the really nice home theaters, they don’t want to watch a 4K stream on their iPad. They want to be able to have the disc.”

Hunt is a disc aficionado.

“I don’t purchase movies digitally. It’s just not my thing,” he added. “If I’m gonna spend my money, I want the best quality, especially in a new format like 4K.”

Redbox, known for its national fleet of disc-rental kiosks as well as its Redbox On Demand digital store, last May began renting 4K Ultra HD rentals in six test markets. Ultra HD Blu-ray Discs rent for $2.50 per night, 50 cents higher than the rental rate for regular Blu-ray Discs (DVDs are $1.75). The test rolled out across more than 2,500 kiosks in Los Angeles, Seattle, Austin, Detroit, Miami and New York City.

“This is a major move for Redbox as we focus on expanding consumer access to home entertainment options across price points and formats,” Galen Smith, CEO of Redbox, told Media Play News at the time. “As the popularity of 4K content increases and pricing of 4K hardware decreases, we’re excited to offer the best viewing experience at the best price for 4K Blu-ray discs.”

But like all content, 4K Ultra HD is fast migrating from disc to digital. Nielsen recently reported that domestic DVD/Blu-ray household penetration has fallen to 67% in the first quarter of 2018 from 73% at the end of 2017, indicating consumers’ shift to other forms of delivery.

“We still believe 4K Ultra HD Blu-ray remains the premium format for viewing 4K HDR content,” says Warner’s Schell. “However, the digital infrastructure continues to improve, with most digital services now supporting 4K HDR content. And with the 5G infrastructure ready to deploy this year from AT&T and others, the availability and digital distribution of 4K content will continue to improve and proliferate globally.”

Home theater enthusiasts are preparing for the future as well, happy that studios are offering 4K digital copies in the physical combo packs.

“The fact that almost all the studios are giving you a 4K digital copy now instead of the 2K digital copy is sweetening that pot a little bit, just to know that I’ve got a more future-ready digital version,” the Home Theater Forum’s Gregorich says.

Digital retailers are catering to the 4K consumer as well.

“It’s likely that a new TV in the home will be a 4K TV, and there’s a dearth of premium content available,” says Cameron Douglas, VP of home entertainment at Fandango. “That’s where providers like FandangoNow step in, with a vast assortment of big 4K titles, most in high dynamic range, ready to watch on demand — titles like Incredibles 2, Solo: A Star Wars Story and Deadpool 2 are just a click away.”

Streaming goliaths such as Netflix, too, are moving into 4K. Netflix reports subs require a minimum speed of 25Mbps to stream 4K content, and it is tinkering with higher pricing for 4K streamers in Europe, perhaps indicating the value of picture quality in the streaming realm.

No matter how the content is delivered, education is the key to expanding the format, observers say.

“Driving further awareness about the format and educating both physical and digital consumers on 4K UHD’s high-value, high-quality proposition will be critical to successfully driving broad adoption,” Universal’s Cunningham says.

“Consumers are witnessing an unprecedented and rapid convergence between 4K options in movies, gaming, streaming and affordable high-end 4K displays that have expanded from televisions to a bevy of smart devices and computers,” says Lionsgate’s Casillas. “The most exciting part is that the best of 4K is still to come.”

Even More Dynamic

Dynamic metadata, as opposed to static, is considered by many to be the height of HDR, allowing colors and brightness to adjust scene by scene.
Dolby Vision, which requires a licensing fee, and HDR10+, which does not, are two of the formats promoting this greater HDR capability.

HDR10+ is backed by 20th Century Fox, Panasonic and Samsung with support from Amazon.

“Fox has eyes toward the future and is committed to bringing consumers the best in picture and sound, often working hand-in-hand with leading technology partners on the development of content for the next generation of entertainment,” says Fox’s Kaye. “This includes the latest HDR10+ technology, which is gaining traction and will further improve the viewing experiences for all audiences.”

Dolby via Dolby Vision, which also offers dynamic metadata, and the sound enhancement, Dolby Atmos, is also vying to improve the home entertainment experience.

“Dolby Vision and Dolby Atmos continue to gather exciting momentum across the entertainment ecosystem,” says Ron Geller, VP of worldwide content relations at Dolby. “Major Hollywood studios and independents are now delivering Dolby Vision on a regular basis, with all studios supporting Dolby Atmos for the home. With a wide range of content available including Dolby technologies, leading service and content distribution providers around the world are enabling the combined Dolby Vision and Dolby Atmos experience. This includes Amazon, iTunes, iQIYI, Netflix, Rakuten TV, Tencent, VUDU, and others. From content creation and distribution to devices, Dolby Vision and Dolby Atmos are creating spectacular experiences for next-gen home entertainment.”

Dolby reports that more than 360 movies are available in Dolby Vision, with more than 400 hours of original content available from Netflix. Also, content partners supporting Dolby Vision include A24, Amazon Studios, BBC, Disney, HBO, iQIYI, Lionsgate, Magnolia Pictures, MGM, Netflix, Paramount, Sony Pictures, Universal Pictures and Warner Bros., among others. Content service providers supporting Dolby Vision include iTunes, iQIYI, Netflix, NTT Plala, Rakuten TV, Vudu and Tencent.

Also, Dolby Vision is available on 4K UHD Blu-ray with 80-plus titles in the market.

On the hardware side, 12 TV brands have Dolby Vision TVs in the market at prices as low as $350, according to Dolby. Apple announced support for Dolby Vision across iPhone, iPad and Apple TV 4K; Lenovo announced the first PCs supporting Dolby Vision; and Microsoft announced Dolby Vision support on Xbox One S and Xbox One X, according to Dolby.

Dolby Atmos is featured on more than 400 movie titles available in the home from all major studios and a wide range of independents, according to Dolby.

As for the home entertainment enthusiasts, they are captive to what the studios and hardware manufacturers support. But they are not too concerned about it.

“It’s whatever the studio opts to use for their authoring pipeline, so it’s not like I have a choice,” says HTF’s Gregorich. “I did as a conscientious decision make sure I had invested in playback hardware that would do both Dolby Vision and HDR10. Unfortunately, HDR10+ came out after I bought displays.”

Hunt, at The Digital Bits, is more sanguine.

“I don’t find it to be a big deal,” he says. “Some consumers swear that it is. Some enthusiasts swear that it is, but I don’t find it to be that big a deal. The key is if you’ve got a really bright display, like a display that can really handle the bright brights and the dark darks, you don’t need Dolby Vision. The Dolby Vision is more of a benefit when you’ve got a display that isn’t fully capable of displaying the full range of dynamics.”

4K Ultra HD Blu-ray All-Time Top 50 Sellers as of 8/25/18
All-Time Top 4K UHD BD Market Share as of 8/25/18

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