February 26, 2008

The Real Reason HD DVD Is Dead: It Wasn't Warner Or A $400 Million Payoff

While the general consensus is that Warner Bros. decision to release their movie titles exclusively on Blu-ray was the last straw in the format war, sealing the fate of HD DVD, general manager of storage device strategy for Matsushita, Masayuki Kozuka says otherwise.

Remember the hoopla surrounding the $99 (and in some places cheaper) Toshiba HD-A2 HD DVD player available from Wal-mart and Best Buy just before Black Friday? According to Kozuka, this pricing strategy was the worst thing Toshiba could have done for HD DVD. By introducing such low prices, Toshiba effectively discouraged new manufacturers from producing HD DVD players. For the most part, Toshiba had the only established series of HD DVD players on the market. Up until this point, standalone HD DVD players were actually outselling standalone Blu-ray players, but by Christmas Blu-ray had a clear lead. So it turns out that maybe Warner Bros. never killed HD DVD, nor did any backroom $400 million payoff, a pre-Black Friday sale did.

Now that HD DVD is dead, movie studios will aim to move the DVD market to Blu-ray, expecting movie titles sales to increase from 7 million last year to 50 million this year. And what about the meme floating around the web stating that Blu-ray will be the next format to go at the hands of digital downloads. Not going to happen anytime soon, says Kozuka, adding that 7-8 years from now could be a totally different story.

Via Tech-on