Do optical media packagers need performance specifications to prevent the erosion of product quality?
Maybe so, said Peter Ciriello, chief executive officer of Carthuplas Inc., a DVD and compact disc packaging producer in Kennebunk, Maine. When the CD jewel box was launched, he said, the specs were clearly understood. ``It was highly automatable, and the quality was repeatable,'' Ciriello said. But pricing pressures led to deviations.
``We are seeing the same thing with DVD cases. We started out with something very durable [and] dimensionally stable.'' But now, he said, processors look for less-costly alternatives - such as reprocessed resins - that have opened a host of durability and contamination issues. He speculated that, in the long run, the DVD case would suffer the same image downfall as the jewel box.
``The consumer will think it is a bad product because it will fail and twist and warp,'' he said.
Carthuplas obtains a certificate of analysis with its resin purchases, according to Ciriello, who spoke during a panel discussion at the Entertainment Media Expo, Aug. 30-31 in Hollywood. ``I'm not sure it would be far-fetched for end users to require that from their packaging manufacturers,'' he said.
In response, media packaging executives and fellow panelists Eric Jakobowicz and Kim Sorensen proposed that packaging standards might dampen design creativity. Jakobowicz is vice president of business development with AGI Polymatrix in Pittsfield, Mass.; Sorensen is president of Scanavo Ltd. in Calgary, Alberta.
``In an ideal world, it would be wonderful if we could use exclusively prime materials,'' Jakobowicz said. ``Given the changing nature of our market and the demands put on us by our market, I just don't know how realistic long-term we can expect to police this type of situation.''
Resin pricing trends are especially troublesome, he said.
``I have been in the resin business earlier in my career, and I can tell you what we are experiencing now is almost unprecedented in terms of the magnitude of the increases ... and also the frequency. It has put a stress on manufacturers such as ourselves with regard to margins. These costs are difficult to absorb on a long-term basis,'' Jakobowicz said.
Tim Barnette, vice president of sales for packaging supplier Nexpak Corp. in Duluth, Ga., said he spent 15 years working in the resin industry. The consolidation among resin suppliers is playing a role in pricing, he said.
``There were really seven or eight real polystyrene suppliers and probably eight or nine polypropylene suppliers,'' Barnette said. ``Now, as a buyer of those products, we do not have that many choices.''
Despite steep and still-rising resin prices, studio content owners expect regular cost decreases to accommodate pressures from the retail market.
``That has been the model in the video supply chain for years,'' Barnette said. ``It is simply an immovable force and an object, and we are getting cracked like a nut.''
Since its introduction in mid-1997, DVD packaging has become a commodity except for specialty cases, Carthuplas' Ciriello said.
``The challenge is really to control costs [and] maintain the quality our customers expect. The new formats are an opportunity,'' Ciriello said.
Nexpak's Barnette agreed, saying the high-definition market is ``a giant opportunity for our company that ... cannot be overstated.''
The onset of any new format requires capital-intensive equipment adjustments, the executives agreed.
``We buy automated systems [and] need four to five years of a reasonable pricing plan,'' Ciriello said.
Barnette said that calculating the capital investment is scary.
``We have to surf these technology waves, and if you miss the wave, you crash. So, it is mission-critical for us to attack these things with every ounce of mettle we have,'' he said.
