Is the tug of war over high-def DVD format over?

Peace may be at hand in the nearly three-year battle to provide HDTV owners with an affordable DVD player that can handle any movie that shows off high-def's vivid video and rich surround sound.

During the last six weeks, Hollywood studios, consumer electronics companies and retailers have given Sony's sne Blu-ray format a seemingly insurmountable edge over its rival high-definition DVD format: Toshiba's HD DVD.

This week Best Buy bby, the No. 1 consumer electronics chain, said that it will feature Blu-ray players and software and will advise customers to buy them instead of HD DVD products.

Separately, online rental firm Netflix nflx said that it will buy only Blu-ray discs and phase out HD DVDs by year's end.

And on Friday, Wal-Mart Stores wmt, the world's largest retailer, said it will exclusively sell DVDs in the Blu-Ray format.

The companies acted after Warner Bros. twx, the No. 1 video distributor, announced that beginning in May it will drop HD DVD and sell its high-def movies and TV shows only on Blu-ray — joining a group that includes Disney dis, Fox, Lionsgate and Sony's film studio.

"Warner's jump was the last straw to break the camel's back," says Walt Disney Studios Home Entertainment President Bob Chapek. "The format war's over."

Well, maybe. The HD DVD camp — which includes Universal, Paramount, DreamWorks Animation and Microsoft msft— hasn't raised a white flag yet.

But it also isn't predicting victory.

"There are a lot of other product areas where different formats coexist," says Jodi Sally, vice president of marketing for Toshiba's digital AV group. "Look at gaming (where Nintendo and Microsoft compete with Sony). There are discs that won't play in each other's machines. Apparently that is the current scenario" for high-def DVDs.

Her view chills executives and technophiles who say that most consumers won't buy two machines — or a pricey combo player — so they can enjoy HD versions of Disney's Ratatouille as well as DreamWorks' Shrek the Third, or Sony's Spider-Man and Paramount's Mission: Impossible.

"We interview consumers, and over the last year 60% didn't want to buy either format until there was a clear winner," says Envisioneering Group director Richard Doherty.

With consumers reluctant to buy into the new technology, Hollywood studios are left selling conventional DVDs — which have grown tired after 12 years in the market. Spending on sales and rentals last year fell 3.1% to $22.9 billion in 2007, according to trade magazine Video Business.

That also opens the possibility that HDTV owners will wait until they can download the movies they want.

Comcast cmcsa, cmcsk CEO Brian Roberts demonstrated at last month's Consumer Electronics Show in Las Vegas a cable Internet technology his company will begin rolling out this year that makes it possible to download a high-def movie in four minutes.

There's still time for high-def DVDs to take off.

"There are an awful lot of pieces that have to come together" before downloading becomes practical, says Stephen Baker, vice president of industry analysis at research firm NPD. "This stuff takes a lot longer to get started than we think it should. But once it gets started, it catches on a lot faster than we think it will."

With the window of opportunity for high-def DVDs starting to close, though, analysts say that retailers may soon pick a winner.

  • 1
  • |
  • 2
  • |
  • 3
Join the Discussion
blog comments powered by Disqus
You Might Also Like...