HD format wars get murkier, dirtier as EU gets involved

Stan Beer
Thursday, 05 July 2007 11:02

Opinion and Analysis

It's no longer any secret that Blu-ray has taken a clear lead at the point of sale over its rival HD DVD high definition video format. No matter how you spin it, Blockbuster and Nielsen VideoScan report more Blu-ray than HD DVD discs being rented and sold. Sales and rentals are largely a factor of two things: high definition player sales and movie studio support. The latter is where things get murky, why the war is still not over and why the EU has entered the fight.

While the games industry is shouting from the rooftops almost daily how Nintendo Wii is slaughtering the Sony PlayStation 3 in games console sales, the fact is that there are now about 4 million PS3 Blu-ray players in homes around the world, including about 1.5 million in the US alone. Compared to that, the number of HD DVD players sold as dedicated players, in PCs or as add-ons to Xbox 360 is miniscule - about 10-15%.

Blu-ray also has the advantage of movie studios support, with the notable exception - and it is a big exception - of Universal which supports only HD DVD. Paramount and Warner Bros have a foot in both camps, but Disney, Fox, MGM, mini-major Lions Gate and of course Sony are Blu-ray only studios. Recently, EU antitrust watchdog the European Commission has become very interested in how studios came to their decision to support either format.

The EC - some say at the prompting of HD DVD advocates - has sent letters to studios backing Blu-ray only asking them to explain why they only back Blu-ray. Presumably, a letter has also gone out to Universal to explain its exclusive backing of HD DVD - one would hope so anyway.

There's absolutely no doubt in the world that there has been a lot of lobbying and deal making going on behind the scenes between movie studios and both HD video camps. The question is why should the EC get involved? It certainly is not in the best interests of consumers to have competing HD video formats. The sooner this war gets resolved the better.

Whether HD DVD stages a fightback and eventually prevails or whether Blu-ray wins out, what consumers want is certainty that the players and HD movies they buy won't go the way of Betamax. This is one battle where market forces should be allowed to prevail. At the moment, Blu-ray has a big advantage on that score because the best selling HD player on the market is the PS3, which is primarily being bought as a games console. What a different story it might have been if the HD DVD camp had been able to convince Microsoft to hold off on releasing the Xbox 360 for a few months.