Sound Advice: Blu-ray wins in format war, but at what cost?In the past I have strongly recommended the HD DVD format as the best choice for consumers. Surprising developments this month led Warner Bros. to drop support for the format, which likely will lead to a Blu-ray victory in the format war. I started receiving inside information about a week before it happened and will recount the story here.
Warner Bros. publishes on both HD DVD and Blu-ray and found the "format war" was not only slowing the adoption of high-definition discs, but also hurting their regular DVD sales -- clearly an untenable situation for them. They wanted to bring the format war to a quick close by picking a side.
If they chose HD DVD, studio support would be roughly equal but would likely go HD DVD's way eventually, as Warner is the biggest producer of high-definition discs. If they chose Blu-ray, studio support for Blu-ray would be lopsided and the war would end more quickly.
When rumors started flying publicly, I e-mailed Jim Noonan, a Warner Bros. vice president, who immediately replied that they had not decided to change their policy. A WB executive in New Zealand issued an even stronger public statement denying imminent changes.
Obviously, they had decided to change -- they just didn't know the direction. Given their long partnership, Warner gave Toshiba an opportunity to lure a Blu-ray studio to HD DVD, in which case they would go HD DVD exclusive and give HD DVD a clear studio advantage.
A deal was nearly secured with Fox, which had been having trouble with Blu-ray disc production due to the lack of manufacturing infrastructure. At the 11th hour, Fox went to Sony with its concerns and received a reported $120 million payout to stay with Blu-ray.With no studio joining them on the HD DVD side, Warner's hand was forced and it went with Blu-ray, receiving a reported $500 million for doing so.Obviously I am saddened by the implications for my readers, the industry and consumers, but still believe I recommended the better, more solid format, which was much more affordable, as well.
I was at their booth at the Consumer Electronics Show and regretted I could not find a single stand-alone player worthy of recommendation -- and if HD DVD goes away, the cost of entry to high-definition movies will be doubled. It's sad for the consumer, really.
My mind and my heart were in agreement that HD DVD was the way to go. To not recommend HD DVD would not be true to my own convictions, and it would be unfair of me to not recognize Toshiba's accomplishment in bringing an affordable, fully developed product to market.
Many in the industry agreed with me, and no one in the media expected Warner to pull the plug so quickly when HD DVD stand-alones were selling so well this holiday season. As for my future course, I will recommend the Playstation 3 to people who want Blu-ray until fully specified Blu-ray Profile 2.0 players are available and their performance matches the PS3.
http://www.post-gazette.com/pg/08012/848675-96.stmREBUTTALFirst of all, this is a format war. So not surprisingly, the main rule at play thus far with these two camps has seemed to be: "All's fair in love and war." For all the talk about how Warner must surely only have bitten the blue pill due to huge payoffs from the BDA (something Warner's Ron Sanders and others have repeatedly denied, I might add), does anyone really think that the HD-DVD camp didn't offer an equally "green" red pill to Warner to go HD-DVD only? And apparently also to Fox, according to Lindich's original story?
Second, I'll again point out that the HD-DVD camp did the exact same thing with Paramount and DreamWorks last year, to the tune of $150 million. And we're now hearing that they MAY be trying to do it again, to keep the remaining HD-DVD studios loyal in the wake of Warner's decision. So this would seem to be a case of "what goes around comes around." As we noted last week, you may recall that, at the time, Paramount simply cancelled many Blu-ray titles that had already been solicited with retailers. Warner is not only still releasing the HD-DVD titles it's announced, but it's releasing more that haven't yet been announced. The bottom line is that HD-DVD enthusiasts have until 5/31 to enjoy titles from Warner on that format, and there are still MAJOR Warner titles on HD-DVD that have yet to be released on Blu-ray.
Finally, as to these rumors about Fox... does anyone REALLY believe Fox would have flipped to the HD-DVD camp after all their talk about how important Blu-ray's added BD+ copy protection was? As some of you might recall, Fox actually delayed releasing titles on Blu-ray for a period of many months last year in order to wait for BD+ to be finalized. And all this was happening while AACS decryption keys were being extracted from HD-DVD releases and posted online.
Fox has been one of the most vocal supporters of Blu-ray. The idea that they would suddenly flip to HD-DVD exclusivity, when software of their preferred format is not only more protected in their eyes but has also been outselling HD-DVD for over a year now, is completely absurd. That would be like a marathon runner with a significant lead at mile twenty-four suddenly deciding to sit down for a coffee break before finishing the race. The belief that Fox was about to go HD-DVD only may simply have been a case of wishful thinking, but wishing does not make it so.
As it happens, I've actually spoken about this today with Fox's senior VP of corporate and marketing communications, Steve Feldstein, who echoed something Warner's Ron Sanders has also said in recent days:
"The kind of money they're talking about [in these stories] isn't worth jeopardizing a multi-billion dollar business." In other words, payoffs would not have impacted Fox and Warner's decisions. Feldstein also told me that when The Pittsburgh Post Gazette piece broke, he contacted Lindich immediately to let him know that he was being misled by someone.
When Don posted the same piece on his own blog, it was edited to reflect this. Specifically, the references to $120 million and $500 million payoffs were gone - something that's worthy of note.http://www.thedigitalbits.com/#mytwocents
