High_definition_optical_disc_format_war

This article is about the Blu-ray/HD DVD format war. For a comparison of formats, see Comparison of high definition optical disc formats.

Formats supported by U.S. studios in 2008. (Size of each slice is relative to 2007 box office receipts.)The Numbers: Annual Movie Chart for Year 2007. Retrieved on 2008-01-02.

The high definition optical disc format war was a format war between the Blu-ray Disc and HD DVD optical disc standards for storing high definition video. These standards emerged between 2000 and 2002 and attracted both the mutual and exclusive support of major consumer electronics manufacturers, personal computer manufacturers, television and movie producers and distributors, and software developers. In early 2008, a tipping point of studios and distributors shifted to Blu-ray disc. On February 19, 2008, Toshiba officially announced that it would stop the development of the HD DVD players, conceding the format war to the Blu-ray Disc format."Toshiba Announces Discontinuation of HD DVD Businesses", Toshiba, February 19, 2008. 

Background

The format war between Blu-ray and HD DVD had antecedents trailing back to the early 20th century, including conflicts between Thomas Edison\'s cylinder records and Emile Berliner\'s disc records for audio recordings, EP vs. LP vinyl records, 8-track vs. compact cassette, and AM stereo vs. FM stereo. More recent conflicts include flash memory cards (CompactFlash, Memory Stick, Secure Digital card, Smart Media), and Hi-fi digital audio (DVD-Audio vs. SACD), as well as recordable DVD formats (DVD+R vs. DVD-R). The videotape format war between VHS and BetaMax resembled the Blu-ray/HD DVD conflict because of Sony\'s strong involvement with both. These format wars have often proved destructive to both camps because consumers, afraid of committing to a losing standard, will refrain from purchasing either.Dranove, David; Neil Gandal. "Surviving a Standards War: Lessons Learned from the Life and Death of DIVX". Idea Group Inc..  Format wars have been avoided in notable cases like the DVD Forum for unified DVD standard, the Grand Alliance for the HDTV standard, and the Wi-Fi Alliance for wireless internet standards.

The emergence of high definition players followed the entry of HDTV televisions into the mainstream market in the mid-1990s. Consumer-grade high definition players required an inexpensive storage medium capable of holding the larger amount of data needed for HD video.Evan Ramstad (1998-04-08). In HDTV Age, Successor to VCR Still Seems to Be a Long Way Off. online.wsj.com. Retrieved on 2007-10-18. The breakthrough came with Shuji Nakamura\'s invention of the blue laser diode, whose shorter wave length opened the door to higher density optical media following a six year patent dispute.Martyn Williams (2002-08-12). Opening the Door for New Storage Options. pcworld.com. Retrieved on 2007-10-18.

Sony started two projects applying the new diodes: Ultra Density Optical and, with Pioneer, DVR Blue.S.B. Luitjens (2001-06-15). Blue laser bolsters DTV storage, features. planetanalog.com. Retrieved on 2007-10-19. The first DVR Blue prototypes were unveiled at the CEATEC exhibition in October 2000. In February 2002, the project was officially announced as Blu-ray, Barry Fox (2002-02-19). Replacement for DVD unveiled. newscientist.com. Retrieved on 2007-10-17. and the Blu-ray Disc Association was founded by a consortium of nine electronics companies.

The DVD Forum, chaired by Toshiba, was deeply split over whether to go with the more expensive blue lasers, which initially required a protective caddy to avoid mis-handling, making the medium more expensive and physically different from DVDs."Next Generation DVD Born", bbc.co.uk, 2002-02-21. Retrieved on 2007-11-04.  In March 2002, the forum voted to approve a proposal endorsed by Warner Bros. and other motion picture studios that involved compressing HD content onto dual-layer DVD-9 discs.Junko Yoshida (2002-03-01). Picture\'s fuzzy for DVD. eetimes.com. Retrieved on 2007-10-19.Junko Yoshida (2001-12-12). Forum to weigh Microsoft\'s Corona as DVD encoder. eetimes.com. Retrieved on 2007-10-19. In spite of this decision, the DVD Forum\'s Steering Committee announced in April that it was pursuing its own blue-laser high-definition solution.Philip De Lancie (2002-06-01). HD on DVD. emedialive.com. Retrieved on 2007-10-19. In August, Toshiba and NEC announced their competing standard Advanced Optical Disc,Toshiba, NEC Share Details of Blue-Laser Storage. pcworld.com (2002-08-29). Retrieved on 2007-10-18. which was finally adopted by the DVD Forum and renamed "HD DVD" the following yearDVD Forum backs Toshiba-NEC format. theinquirer.net (2003-11-28). Retrieved on 2007-10-18. after being voted down twice by Blu-ray Disc Association members, prompting the U.S. Department of Justice to make preliminary investigations.Opinion: Trust\'s worth.Lieberfarb lobs charges at Blu-ray. Three new members had to be invited and the voting rules changed before the initiative finally passed.Junko Yoshida and Yoshiko Hara (2003-11-14). High-definition DVD format divides industry into rival camps. my-esm.com. Retrieved on 2007-10-19.Yoshiko Hara (2003-11-26). HD DVD Format Wins Key Nod From DVD Forum. techweb.com. Retrieved on 2007-10-19.

The competing standards had significant differences that made each incompatible with the other.

Alliances

The Blu-ray Disc Association was started by Hitachi, LG, Panasonic, Pioneer, Philips, Samsung, Sharp, Sony, and Thomson in 2002-02-19.Large Capacity Optical Disc Video Recording Format "Blu-ray Disc" Established. SONY Press Release (2002-02-19). Retrieved on 2007-08-31. Early supporters included Apple, Dell, and Panasonic.Companies supporting Blu-ray. Retrieved on 2007-07-07.

The comparable HD DVD Promotion Group included Toshiba, NEC, Sanyo, Microsoft, RCA, Kenwood, Intel, Venturer Electronics and Memory-Tech Corporation, with non-exclusive support by Acer, Asus, HP, Hitachi Maxell, LG, Lite-On, Onkyo, Meridian, Samsung,Blu-ray Samsung backs HD DVD - Foot in both camps (16 April 2007). and Alpine. In Europe, HD DVD was supported either exclusively or non-exclusively by Medusa Home Entertainment, Studio Canal, Universum Films, Kinowelt Home Entertainment, DVD International, Opus Arte, MK2, Momentum Pictures, Twister Home Video, among others.^{[citation needed]}

During the height of the format war, some studios supported both formats, including Paramount Pictures (including subsidiaries Nickelodeon Movies, MTV Films, DreamWorks Pictures and DreamWorks Animation), BBC,BBC says it will still support both high-def formats. First Look Studios,First Look Brings \'King of California,\' \'Amateur\' to HD DVD; Adds Blu-ray Support. Image Entertainment (including the Discovery Channel),Discovery Channel Brings \'Atlas\' to Blu-ray, HD DVD. Magnolia Pictures,Psst! Magnolia Jumps Into Blu-ray with \'Bubble\'. Brentwood Home Video, Ryko, and Koch/Goldhil Entertainment.\'Chronos\' HD DVD Gets New Distributor; Blu-ray Version on the Way.

Attempts to avoid a format war

In an attempt to avoid a costly format war, the Blu-ray Disc Association and DVD Forum started to negotiate a compromise in early 2005. One of the issues was that Blu-ray\'s supporters wanted to use a Java-based platform for interactivity (BD-J), while the DVD Forum was promoting Microsoft\'s "iHD" (which became HDi).Junko Yoshida (2005-04-19). Sides close to deal on HD disk format. eetasia.com. Retrieved on 2007-10-19. A much larger issue, though, was the physical formats of the discs themselves; the Blu-ray Disc Association\'s member companies did not want to risk losing billions of dollars in royalties as they had done with standard DVD.Andy Patrizio (2007-04-12). Who Is Drawing Out The High-Def DVD Stalemate?. internetnews.com. Retrieved on 2007-10-19. An agreement seemed close, but negotiations proceeded slowly.Michiyo Nakamoto (2005-05-17). Sony-Toshiba DVD format talks stall. ft.com. Retrieved on 2007-10-19.

At the end of June 2005, Sun announced that the Blu-ray Association had chosen the Java-based BD-J interactivity layer instead of Microsoft\'s HDi. This was based on a BDA board vote favouring BD-J 10 to 4, despite a technical committee previously favouring HDi by a vote of 7 to 5.Micro-managed copies. At the same time, Microsoft and Toshiba jointly announced that they would cooperate in developing high-definition DVD players.David Cohn (2005-06-27). Microsoft, Toshiba Gear Up. wired.com. Retrieved on 2007-10-19. In a top-level meeting in July, Microsoft\'s Bill Gates argued that the Blu-ray standard had to change to "work more smoothly with personal computers". The Blu-ray Disc\'s representatives defended the technology.Cliff Edwards, Peter Burrows, Ronald Grover, Tom Lowry and Kenji Hall (2005-10-17). Daggers Drawn Over DVDs. businessweek.com. Retrieved on 2007-10-19.

On August 22 2005, the Blu-ray Disc Association and DVD Forum announced that the negotiations to unify their standards had failed.Sony, Toshiba fail to unify DVD format - report. forbes.com (2005-08-22). Retrieved on 2007-10-19. Rumors surfaced that talks had stalled; publicly, the same reasons of physical format incompatibility were cited. In the end of September, Microsoft and Intel jointly announced their support for HD DVD.Susan B. Shor (2005-09-27). Microsoft, Intel Back Toshiba\'s HD-DVD. ecommercetimes.com. Retrieved on 2007-10-19.

Hewlett Packard (HP) made a last ditch attempt to broker a peace between the Blu-ray Disc Association and Microsoft. HP demanded that the Blu-ray association adopt Microsoft\'s HDi instead of its own Java solution, and that Blu-ray adopt a mandatory managed copy feature. If their demands weren\'t met, HP threatened to support HD DVD instead.Ken Young (2005-10-20). HP calls for changes to Blu-ray. vnunet.com. Retrieved on 2007-10-19. In a research report, Gartner analysts Van Baker, Laura Behrens and Mike McGuire wrote that if HP\'s proposal was accepted, Blu-ray would become the winner of the format war.Robert Jaques (2005-10-25). HP\'s Blu-ray move spells doom for HD-DVD. vnunet.com. Retrieved on 2007-10-19. However, the Blu-ray Disc group did not agree to HP\'s demands."Blu-ray Won\'t Bow to HP\'s Demands", foxnews.com, 2005-11-17. Retrieved on 2007-10-19. 

HD DVD players and movies were released in the United States on April 18 2006,Netherby, Jennifer; Susanne Ault (2006-04-13). HD DVD set to launch quietly. Video Business. Retrieved on 2007-04-09. The first Blu-ray Disc titles were released on June 20 2006 and the first movies using dual layer discs (50 GB) were introduced in October 2006. Bracke, Peter M. (2006-10-10). Click: Blu-ray Disc review. HighDefDigest.com. Retrieved on 2007-09-15.

Deciding factors

The format war\'s resolution in favor of Blu-ray was primarily decided by two factors: shifting business alliances, including decisions by major film studios and retail distributors, and Sony\'s decision to make Blu-ray players a part of the Sony PlayStation 3 video game console.

Studio, distributor alliances

Studio alliances shifted over time. Prior to October 2005 and before the release of either format, each had the exclusive support of three of the Big Six. Then HD DVD supporters Warner Bros. and Paramount added support for Blu-ray.Grover, Ronald; Peter Burrows, Cliff Edwards (2005-10-05). A Warner Bros. Green Light for Blu-ray?. BuinessWeek. Retrieved on 2008-01-14. But in August 2007, after supporting Blu-ray for over a year, Paramount announced it would release all high-definition content (except titles directed by Steven Spielberg) exclusively on HD DVD. At the same time, DreamWorks Animation SKG, which had not released any high-definition discs, announced it would release exclusively on HD DVD. Explaining their decisions, the companies cited perceived advantages to HD DVD\'s technology and lower manufacturing costs. The companies together received about $150 million in cash and promotional guarantees, including a Toshiba HD DVD marketing campaign with a tie-in to Shrek the Third.Paramount and DreamWorks Animation Each Declare Exclusive Support for HD DVD.Barnes, Brooks. "Two Studios to Support HD DVD Over Rival", New York Times, 2007-08-21. Retrieved on 2007-11-13. 

But the tipping point came on January 4, 2008 when Warner Bros., which has the largest market share of DVDs, announced plans to drop HD DVD support completely as of the beginning of June 2008. At the Consumer Electronics Show in Las Vegas, some HD DVD-related events and private meetings with analysts and retailers were cancelled, including an event scheduled for the eve of the show sponsored by the North American HD DVD Promotional Group. Toshiba management expressed disappointment over Warner\'s decision but said that Toshiba would continue promoting the competing format.Waters, Richard Waters; Paul Taylor , Mariko Sanchanta. "Sony DVD move deals blow to Microsoft", Financial Times, 2006-01-06. Retrieved on 2008-01-06. "Toshiba Defiant After HD DVD Setback", Associated Press, 2008-01-06. Retrieved on 2008-01-06.  The following Monday, Toshiba reduced the price of its HD DVD players by 40 to 50 percent, calling price a "deal breaker for the mainstream consumer"."Toshiba cuts HD player prices in Blu-ray fight", Reuters, 2008-01-14. Retrieved on 2008-01-15.  At the time, analyst Roger Kay of Endpoint Technologies Associates likened the price cut to the high-stakes Blackjack bet of "doubling down" in an effort to increase market share and "win back the studios".Kessler, Michelle. "Toshiba turns up heat in DVD war with big price cut", USA Today, 2008-01-14. Retrieved on 2008-01-15.  Richard Greenfield of Pali Capital called the move a gimmick and predicted that HD DVD would not become widely adopted.Sung, Chinmei; Andy Fixmer. "Toshiba Cuts Retail Prices of HD DVD Players by 50%", Bloomberg, 2008-01-14. Retrieved on 2008-01-15.  Gartner analyst Hiroyuki Shimizu predicted that while the price cut might extend HD DVD\'s life somewhat, the limited title library would ultimately "inflict fatal damage on the format", leaving Blu-ray the victor by the end of 2008.Nystedt, Dan. "Gartner: HD DVD Price Cuts Only Prolong Agony", PC World, 2008-01-28. Retrieved on 2008-01-31. 

Warner Bros.\' sister studio New Line Cinema followed suit, canceling tentative plans to release titles on HD DVD."New Line Details Transition to Blu-ray", High-Def Digest, 2008-01-08. Retrieved on 2008-01-25. hddvd.com - New line titles delayed for HD DVD due to lack of region coding. Other small studios and producers moving exclusively to Blu-ray included National Geographic Society, Constantin Film, and Digital Playground.homemediamagazine.com"Did Warner Bros. Just Kill HD DVD?". Retrieved on 2008-01-05. DVD format war appears to be over. Retrieved on 2008-01-05.Pie Charts Show True Impact of Warner Bros. Move to Blu-ray. Retrieved on 2008-01-07.

Warner\'s move also caused a chain reaction among DVD distributors, most prominently in the form of Wal-Mart\'s February 15, 2008 decision to phase HD DVD out completely by June 2008.http://www.walmartfacts.com/articles/5673.aspx Wal-Mart is the largest DVD retailer in the United States, and its decision prompted the New York Times to run a mock obituary for the HD DVD format. The newspaper quoted technology analyst Rob Enderle\'s contention that if Wal-Mart "says HD DVD is done, you can take that as a fact."Richtel, Matt; Eric Taub (2008-02-16). Taps for HD DVD as Wal-Mart Backs Blu-ray. New York Times. Retrieved on []. Four days earlier, Best Buy began recommending Blu-ray Disc as the customer\'s digital format choice,Business Wire (2008-02-11). "Best Buy to Recommend Blu-ray as the Customer\'s Digital Format Choice". Press release. Retrieved on 2008-02-12. and Netflix, the largest online video rental service, began phasing out its HD DVD inventory after stocking both formats since early 2006.Netflix, Citing a Clear Signal From the Industry, Will Carry High-Def DVDs Only in Blu-ray Format. Netflix press release (2008-02-11). Retrieved on [].http://biz.yahoo.com/ap/080211/netflix_blu_ray.html?.v=1

These shifts were preceded by Blockbuster, the largest U.S. movie rental company, which in June 2007 had moved to Blu-ray exclusively in 1450 stores after test-marketing both formats at 250 stores and finding that more than 70% of high definition rentals were Blu-ray discs.Blockbuster backs Blu-ray CNN, June 18, 2007. (Web archive)Blackbuster Online - HD In July 2007, Target Corporation, began carrying only Blu-ray standalone players in its stores, promoting them with end cap displays featuring Blu-ray Disc movies from Sony and Disney.Target to sell only Blu-ray DVD players | Reuters In January 2008, UK retailer Woolworths Group plc said it would stock only Blu-ray discs in its 820 stores beginning in March 2008."Woolworths backs blu-ray format over HD-DVD", Woolworths press release, 2008-01-28. Retrieved on 2008-02-08. 

PlayStation 3

Sony\'s decision to incorporate a Blu-ray Disc player as a standard feature of the PlayStation 3 video game console also helped ensure the format\'s eventual triumph. By the time Toshiba ceded the market, about 10 million of the Sony consoles had sold versus an estimated 1 million HD DVD players – including both standalone units and the add-on player for Microsoft\'s Xbox 360 console. This equipment gap was a factor in Blu-ray titles outselling their HD DVD counterparts two to one in the United States and three or four to one in Europe. Sony\'s strategy came at a cost. The company initially sold the PlayStation 3 at a loss of more that US$200 per unit, resulting in a total loss estimated at more than $3 billion. But analysts believe that with Blu-ray\'s success, the resulting royalties will eventually more than make up for the deficit.Sabbagh, Dan. "How the Blu-ray war was won - Sony outspent, outsold Toshiba", The Times, 2008-02-21. Retrieved on 2008-02-23. Smale, Will. "How the PS3 led Blu-ray\'s triumph", BBC News, 2008-02-19. Retrieved on 2008-02-23. 

Toshiba announcement and aftermath

On February 19, 2008, Toshiba announced it would cease developing, manufacturing and marketing HD DVD players and recorders."Toshiba Announces Discontinuation of HD DVD Businesses", Toshiba Press Department, 2008-02-19. Retrieved on 2008-02-19.  On that same day, Universal Studios announced it would release its titles in the Blu-ray Disc format, following two years of exclusive HD DVD support. highdefdigest.com The studio will release two more HD DVD titles: Fletch on 2008-03-11 and Atonement on 2008-03-18. http://www.highdefdigest.com/news/show/Universal/Industry_Trends/Universal_Ends_HD_DVD_Support_with_Atonement/1527 On February 20, 2008, Paramount Pictures announced it would back Blu-ray, becoming the last of the Big Six studios to do so.Hollywood Reporter:Paramount seals Blu-ray sweep. Paramount ceased HD DVD production on February 28, 2008, with Things We Lost in the Fire and Into the Wild becoming the studio\'s last HD DVD releases, both released March 4, 2008. The first Paramount Blu-ray Disc release since August 2007 is expected in summer 2008.http://www.hollywoodreporter.com/hr/content_display/home_entertainment/video/e3i0055cabe5256398afc4fc3dc4e59ea6f Paramount sister DreamWorks Animation followed suit by canceling its only remaining HD DVD release: Bee Movie.http://www.highdefdigest.com/news/show/DreamWorks/Paramount/Industry_Trends/Paramount_Cancels_Majority_of_HD_DVD_Slate_(UPDATED)/1522

Microsoft stopped production of Xbox 360 HD DVD players while considering how its proprietary HDi and VC-1 technologies could be applied to other platforms."Microsoft Pulls Plug on HD DVD Players", Associated Press, 2008-02-24. Retrieved on 2008-02-24.  Microsoft has since entered into talks with Sony regarding Blu-ray."Sony chews the Blu-ray fat with Microsoft", RegHardware.co.uk, 2008-03-07. Retrieved on 2008-03-10. 

See also

• Format War
• Videotape format war

References

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