Friday, May 6, 2011

The Japanese Disaster & the Effects on Media Supplies

The March 11 earthquake and tsunami that wreaked death and destruction in Japan, and created a grave nuclear threat situation that is still in flux, has also had a huge effect on the world economy.

And the Communications field has been no exception.

When life and death and environmental catastrophe are threatening, it seems a bit trivial to discuss such things as media supply, but we at Video Labs are in the business of media replication, and we feel it our responsibility to keep our clients informed on any impact the disaster in Japan may have on their businesses.

The Sony manufacturing facility in Sendai, which is about 80 miles from the earthquake’s epicenter, suffered severe damage and ceased operations.


(click photo to view footage)


As a result, the following tape formats have been particularly challenging to obtain: HDCAM (both rstandard and SR), XDCAM, IMX and DVcam. Also affected is Blu-ray disc stock.

And there’s been a domino effect as well. When producers can’t obtain a particular format, they then move toward trying to find either “used" (aka "evaluated” stock) of that format or start considering alternative formats. The result is that the demand for both has soared as well.

This whole paradigm gets further roiled by the trend of media replicators like Video Labs enacting “just in time” inventory policies as way to be more efficient in the current recession.

And as with the oil economy, when scarcity, demand and panic are all in play at the same time, prices go up. So, given the rapidly changing nature of the situation, we ask that you understand that there may need to be some price flexibility between once a job is quoted and once it is started.

Be assured, we are being diligent in our efforts to help our clients meet their media needs. To assist us, we ask that you give us as much notice as possible regarding any media replication orders you have in the pipeline.

The latest we have heard is that the Sendai plant will start production of Blu-ray discs in late May and tape stock in July.

We appreciate your understanding of the situation and encourage you to stay in contact with your Video Labs account manager.

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