Xbox is vital for HD DVD survival

Stan Beer
Wednesday, 24 October 2007 11:23

Opinion and Analysis

I have absolutely no idea whether the story over on Smarthouse about the development of a new Xbox incorporating an HD DVD drive is true or just wistful musing on the part of a Singaporean Toshiba executive. However, if HD DVD is to have any chance of winning the format war, then the idea is a project whose time is long overdue.

Microsoft's gain in the gaming space in bringing Xbox 360 to market early with a standard DVD drive has been Toshiba's loss in the high definition video market. Sony, whose Playstation 3 made a sluggish start because of its high price and production problems, has still managed to put more than 5 million Blu-ray toting games consoles into homes around the world much to the detriment of the HD DVD cause.

Meanwhile, Xbox 360, replete with games, including the newly released Halo 3, is selling up a storm. It must grate on the nerves of Toshiba executives to know that, despite quality issues, Microsoft has sold more than 11 million Xbox 360 units worldwide, while Toshiba struggles to move more than a few hundred thousand standalone HD DVD players. An Xbox 360 incorporating an HD DVD player was a seeming no-brainer yet it didn't happen.

Obviously Microsoft, which doesn't have a stake in the HD DVD video business, wanted to get a head start on Sony. Another possible issue could have been price. An Xbox 360 with an onboard HD DVD player may have priced the early Xbox 360 consoles out of the market as Blu-ray did with the PS3.

While Sony continues to languish behind Xbox 360 and the Nintendo Wii in the games console race, the company has managed to out-manoeuvre Toshiba in the high definition video race by getting millions of Blu-ray players into homes by stealth.

So what do Toshiba and Microsoft do now? The answer, as pointed out in the Smarthouse story, is obvious. However, if the story's time frame for releasing the new HD DVD Xbox consoles in late 2008 or early 2009 is right, the move may be a tad late.

Twelve months or more from now, Sony could well have more than 15 million Blu-ray PS3 consoles in the homes of consumers. That would be a huge lead for Toshiba and Microsoft to make up and the format war may well be over by then. Still, Toshiba has no option. 2008 should be an interesting year.