In February, 2008, the battle for supremacy in high-definition DVD technology ended. Toshiba surrendered to Sony in the most expensive format war since VHS videocassette format trumped Sony's Betamax in the 1980s. Toshiba and other HD-DVD supporters like General Electric Company (GE) and Microsoft (MSFT) must now shift their focus to phasing out the HD-DVD format in the least painful way possible. This means reducing the price on the Toshiba's remaining HD-DVD players and providing customer support to HD-DVD customers.
In its late stages of the battle, and HD DVD and Blu-ray made their best efforts to gather disk and decoder/reader manufacturers, media companies, and retail outlets to their respective sides. Blu-ray had a string of victories, gaining endorsements from major rental companies Netflix and Blockbuster, and in January 2008 the production company Warner Brothers announced that it would support the Blu-ray format exclusively. Meanwhile, the top two DVD retailers in the United States, Wal-Mart and Best Buy, announced in February 2008 that they will showcase Blu-ray over HD DVD and phase out the latter in the long term. Toshiba's HD DVD continues to have the support of the other major Hollywood production companies, including Universal Pictures and Paramount Pictures, but this may change with the recent votes of support for Blu-ray by the key distributors.
Blu-ray technology, developed by Sony (SNE), got a slower start and is a slightly more expensive technology than HD DVD (Toshiba's competing product), but its proponents argue that Blu-Ray's larger storage capacity (25GB for a single layer disk and 50 GB for a dual layer, nearly twice the capacity of HD DVD) make up for the price difference. Blockbuster's announcement in summer 2006 that it would carry Blu-ray DVDs (adding a limited selection of HD-DVD after a year or so) was the first indicator of shifting favor away from HD DVD and towards Blu-ray as the main high definition technology. In January 2008, Warner Bros. announced it would release high def DVDs in Sony's Blu-ray format only, joining several other production companies and ensuring that in 2008 roughly 70% of new releases will be in Blu-ray. The two formats are incompatible, meaning that buyers of HD DVD players cannot play movies issued in Blu-ray, and vice versa.
February 2008 seemed to deal the final blow to Toshiba's format. In the same week, Wal-Mart and Best Buy announced their intention to focus on Blu-ray, and after a weekend flush with Japanese media reports that Toshiba would pull the plug, the firm announced that it would review its HD DVD strategy with an end to operations sure to be the outcome. A variety of factors, from marketing to management strategy, played into Blu-ray's ascent and HD DVD's swift decline, but it appears that the approximately 1 million customers who have purchased HD DVD equipment as of February 2008 will soon possess outdated technology and have no recourse but switch to Blu-ray or pursue digital options if they hope to watch newly released movies from home.
Although several companies have introduced decoders (used in DVD players) that can read both Blu-ray and HD DVD, the two optical storage formats cannot coexist in equality forever. Many companies are deeply invested in one side or the other, and all of the major players take the position that customers will benefit from the compatibility and expanded content choices that a single format in the industry can offer. There are also a number of companies who will "win" no matter which format emerges dominant.
|Single Layer (Gigabyte)||25||15|
|Dual Layer (Gigabyte)||50||30|
|Theoretical Limit (Gigabyte)||200||60|
|Security Measures||Mandatory HDCP Encrypted Output, ROM-Mark Watermarking Technology, BD Dynamic Crypto (Physical Layer), Advanced Access Content System||Mandatory HDCP Encrypted Output, Volume Identifier(Physical Layer), Advanced Access Content System|
|Retail Price Comparison|
|Babel (Movie) - $27.95||Babel (Movie) - $27.95|
|Cheapest Available Playstation 3 (40GB) with Blu-Ray Capacity - $399||Cost of XBox 360 with Additional HD-DVD External Drive - $498|
|Samsung BD-P1000(Cheapest available stand-alone Blu-Ray player found) - $489.77||Toshiba HD-A2 (Cheapest available stand-alone HD-DVD player found) - $329.99|