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December 26, 2007

Blue-ray Disc, HD DVD Continue to Fight it Out in Marketplace

By Shamila Janakiraman, TMCnet Contributing Editor

Blu-ray Disc and HD DVD formats are still competing to become the high-definition successor to DVDs. For the moment, according to a recent report, Blu-ray players seem to have taken the lead in terms of sales.
At some stores, though, prices for HD DVD players during the holiday season were considerably lower than Blu-ray: $98 (HD DVD) at Wal-Mart compared with roughly $299 (Blu-ray).
Players may not be the real deciding factor in which format wins this war, though. Andy Parsons (News - Alert), senior vice president of product planning at Pioneer Home Entertainment Group and chairman of the Blu-ray Disc Association Promotions Committee, was quoted in a CNNMoney.com report as saying that discs are more important than players.

“A lot of people have been looking at hardware sales as a bellwether, but we really should be looking at content sales not hardware sales,” Parsons was quoted as saying in the report.
The report also cited figure from Parsons said that so far 4 million Blue-ray software titles have been sold, while sales for HD DVD software titles stand quite a bit loer at 2.6 million. Blu-ray also reportedly leads sales of movies and games.
Sales of high-definition players have not picked up as expected, CNNMoney.com reported. One deterrent is the fact that discs in one format won’t play in machines intended for the other, so people may be reluctant to commit to a player without knowing if the chosen format will stay around. Instead they’re likely to stick with DVD until the outcome become clearer.
“When we look at competitors, it's really not Blu-ray. It's DVD. People are very happy with their DVDs,” said Ken Graffeo, executive vice president of HD strategic marketing for Universal Studios Home Entertainment and co-president of the HD DVD Promotional Group, in the CNNMoney.com report.
Also, CNNMoney.com said in its report, not that many homes have high-definition TV sets yet, so demand for high-def players has yet to pick up. High definition is, in short, still in the early-adopter stage.
In the report, Parsons added his opinion that Toshiba (News - Alert) is prematurely trying to enter the mass market for HD DVD; DVD itself took 3 years to reach mass market product status and high-def disc formats are only 18 months old. Most consumers are likely to stick with DVD into 2008.
Toshiba makes HD DVD players while Panasonic (News - Alert), Philips PHG, Pioneer, Samsung and Sony make Blu-ray Disc players, CNNMoney.com said in its report. Viacom’s VIA Paramount Pictures, DreamWorks Animation DWA and NBC Universal (News - Alert) support HD DVD exclusively. Sony, MGM, Walt Disney DIS, News Corp.’s Twentieth Century Fox all back Blu-ray exclusively. Time Warner is the only studio supporting both formats.
“Microsoft (News - Alert) believes that HD DVD offers the best overall quality and value for consumers and is the best next-generation DVD format for the industry,” CNNMoney.com’s report quoted Jordi Ribas, general manager of the HD DVD Group at Microsoft, as saying. “We have made major technology investments in HD DVD, from our HDi interactive layer to our VC-1 video codec, and have more than 100 staff at Microsoft dedicated to the success of HD DVD.”

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Shamila Janakiraman is a contributing editor for TMCnet. To read more of Shamila’s articles, please visit her columnist page.

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