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High-def DVD Format War: More Bad News for HD-DVD

January 5, 2008

On Friday, Warner Bros. dropped a bomb on the consumer electronics industry by announcing it would stop supporting the HD DVD format and stick with Sony's Blu-Ray for high definition discs.

The decision leaves only Paramount and Universal as HD DVD loyalists. Plainly, shrinking of that cadre the two-studio base does not bode well for HD DVD.

And as evidence of that, a planned HD DVD press conference at the Consumer Electronics Show (which starts this Monday) has been canceled.

Sounds to me that the HD DVD advocates are in a funk. I mean, who can blame them?

The underpinning issues are real complicated, having to do with affordablity and a reluctance to confuse customers.

These issues are explained in apiece by Diane Garrett, of the show-business "bible" Variety:

She writes in part:

Warner execs cited Blu-ray's domestic and international sales as the tipping point in its favor. From the start, the Sony developed format enjoys has had an advantage in greater studio support and the PlayStation 3 console, which plays high-def movies and, at least in the early going, was much more affordable than Blu-ray decks, which have tended to carry a higher price tag than HD DVD counterparts.

Supporting both formats came with a cost for the studio, which had to maintain dual inventories for their releases. And while the studio had some of the best sellers on high-def when both formats were added together, they couldn't help but wonder whether dual support was helping, or hurting, the transition to a next-gen format.

"By us being both, we were playing into consumer confusion," Tsujihara said. "There's a window of opportunity with first time buyers of HD TVs to also buy a high-def player at the same time."

"The window of opportunity for high-definition DVD could be missed if format confusion continues to linger," Warner Bros. chairman and CEO Barry Meyer seconded.

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