DVD high definition format battle a dead heat

Stan Beer
Saturday, 12 August 2006 06:13

Opinion and Analysis

Two weeks ago we conducted a reader poll which ran for a full week posing the question:  Who will win the high definition video war? As we wrote on August 9, the hundreds of respondents were almost exactly evenly divided in their opinions between Blu-ray and HD DVD. A new report vindicates that result.

Market research company Screen Digest has come out with some negative predictions for the two formats, saying that neither will win the war and eventually they will be forced to merge into a single format.

In addition, the firm suggests that all the publicity surrounding the Blu-ray and HD DVD debate will inhibit the consumer market from making a choice and moving forward into high definition technology.

While Screen Digest is probably right about the end result eventually being one affordable high definition format, there are still a few issues to be resolved.

Firstly, Hollywood is firmly behind Blu-ray and only partially behind HD DVD. Secondly, Microsoft, which controls the computer desktop space, is firmly behind HD DVD. Sony, which is the games console leader, is firmly behind Blu-ray. Finally, HD DVD players are over priced and Blu-ray players are ridiculously over priced.

With Hollywood studios obviously prepared to sit on the fence and wait to see the outcome of the format war, the obvious battle ground is going to be the games space, where the two major players are prepared to subsidise the prices of players.

Consumers do not want to pay US$1000 or even US$500 for a video player. However, they will be prepared to shell out $500 for a games console that also doubles as a high definition video player.

Both Microsoft and Sony recognise this. However, Sony appears to be the better positioned of the two companies at present because it is a couple of months away from releasing PlayStation 3 consoles with integrated Blu-ray players.

Microsoft rushed its Xbox 360 players onto the market with ordinary DVD players so that it could get the jump on Sony in the games space. Now the software company plans to bring out a subsidised add-on HD DVD player for Xbox 360 for about US$200. Many console owners will buy the optional add-on and many won't bother. PS3 owners, however, will all have Blu-ray players. Look for Microsoft to announce Xbox 360 with integrated HD DVD soon.