E’tu Warner… what now for HD DVD?

[MI55ION]

As the news of Warner's defection to the Blu side sank in yesterday, I like many others I'm sure, was left thinking what now for the future of HD DVD? What could the HD DVD camp do to get out of this mess, did they really not anticipate a move like this could severely upset the equilibrium and have some sort of contingency plan in place.

From the press release it appears that Warner has taken everyone for a ride, from Microsoft and Toshiba right down to early adopters, the largest studio in Hollywood and one that has the biggest share in HDM market has used HD DVD as a platform to lower hardware prices and increase mass adoption. The irony is of course, just as HD DVD, seen by many as the consumer friendly format, reached hardware prices to attract the masses with every chance of success, Warner releases their atom bomb.

Consumer confidence in the format will now be at an all time low, HD DVD is severely wounded, what could they possibly do to recover?

[Greg]

Whilst we don't need yet another thread on this subject, I will keep this one open purely as discussion on where next for HD DVD, which I do think warrants discussion.

Any snide or ***taking comments by particularly blu-ray, but also HD DVD fanboys will result in 7 days suspension. Keep it intelligent please.

[Greg]

Non mod post!

Personally, speaking as a dual format owner, I can not see how HD-DVD can pull this round now. Warner going Blu-ray only is a major defection.

If there haven't been any major announcements from the HD DVD camp, including Microsoft this week at the CES show, then I think HD DVD will gradually fade off. The only thing I can see that could help the HD DVD side is if Microsoft actually release this rumoured Xbox 360 Ultimate with its inbuilt HD DVD drive. Otherwise not sure what else can be done.

[richard plumb]

I don't think Warner took anyone for a ride. From the sounds of it they were seeing what both sides had to offer. They knew they were a big player, they felt that one format was necessary to get growth (if indeed SD DVD sales were slower than expected due to this 'war'). Its possible they could have jumped either way.

IMO HDDVD needs to go away now. No spite in the comment, they just need a smooth transition. Toshiba's press release to comment on Warner's annoucement was interesting in its wording.

IMO the best way forward would be to have some kind of ordered transition to bluray. Perhaps sweetened by allowing Toshiba a slice of the license fee pie.

Have a free disc exchange program to swap HDDVDs for blurays, and some kind of subsidy for HDDVD player owners to buy bluray players.

Alteratively, Toshiba could bring out a cheap dual format player or provide guarantees as to spares/replacement availability to give confidence to existing owners. But they should withdraw from the hardware market during2008.

[Rasczak]

Originally Posted by MI55ION

As the news of Warner's defection to the Blu side sank in yesterday, I like many others I'm sure, was left thinking what now for the future of HD DVD?

HD DVD has time to recover from this: Warner are supporting the format until May and remains with Universal, Paramount and Dreamworks as exclusive supporters. It also has heavyweights like 2Entertain and Studio Canal onside.

Next week will be a bad week for HD DVD as Blu-ray will dominate CES and New Line will formally drop the format. But going on from there we may well see a recovery strategy if Universal and Paramount can fill up the release schedule. Of course if either of those studios goes neutral or pulls out then I think HD DVD will fade.

But we are not there yet and I'm sure the HD DVD Forum are considering their options - I suspect their strategy will become clearer in the next month or so. Maybe Microsft/Toshiba can entice a third stuio (unlikely IMHO). Or, as a last resort, maybe dirt cheap dual format players simply to increase the user base?

Interesting times ahead...

[Craigy]

I think they cant do anything, maybe if they released the Elite 360 (last year) with HD-DVD (internal) and bundled it with a couple of movie like Transformers then maybe the general shop going public may have bought into it, they were slow to release titles in the UK as well, having roughly a quarter of available titles in HMV when I have been in.

[stuartbrown21]

I recall prior to the Paramount / Dreamworks announcement having an impending feeling of doom for HD DVD. Post that announcement, studio support looked quite similar, but it felt like HD DVD had the momentum, plus we had the very fine 3rd gen players being released with enticing free disc promotions.

Now after this, we are back to the original position, only somewhat worse considering the size of Warners library, and with the momentum firmly in favour of Blu-Ray.

The only bright spot on the horizon is that both formats are still tiny compared to DVD, and in truth the vast majority of the general public just don't give a monkeys about HD material!! To them, DVD is very cheap and works extremely well - they just don't need anything better. Only cheap hardware is going to shift either format, and fortunately for HD DVD they are still currently the only format that can offer something approaching a good value proposition to the general public. Warners announcement will undoubtedly cause the split of the HDM market to swing in favour of Blu-Ray in a big way, but I doubt their share of all disc sales will increase significantly for a few years.

I think there may still be a chance that HD DVD could win this war (not a big chance though, admittedly!!). As I understand it, Toshiba is in much better financial health than Sony, and obviously you can take into account the backing they receive from Microsoft also. If they are able to maintain a presence in the market, and keep their remaining exclusive studios, this could still swing in their favour.

[Pecker]

Originally Posted by Greg

Non mod post!

Personally, speaking as a dual format owner, I can not see how HD-DVD can pull this round now.

China.

They have CH-DVD (or whatever it's called), which will continue as BD is going to be far too pricey for the Chinese Market for a year or two.

In that time Chinese manufacturers will drive down HD DVD prices, resulting in it costing just a few quid to add HD DVD-compatability to SD DVD & BD players.

Picture this - January 2009.

Universal & Paramount are still HD DVD-exclusive.

The cheapest BD standalone is £100. The cheapest BD standalone with HD DVD capability is £125.

Which will people buy?

If HDM takes off at that point, and HD DVD is still cheaper to produce, what will Warner do then?

Just a guess.

Steve W

[Adam_uk]

I really think this is a knock out blow for HD DVD- which is a shame as I love my XE1 and the format.

Tosh could license the tech to BD so all future players cold be dual format at low cost. Or as Greg suggested offer some swap/ subsidy to change DH DVD's to BD (though this would make no commercial sense).

MS could release an internal 360- but so what- it is not a HW issue, its software- Warner, Fox, Disney, Sony all BD only- no neutral studios at all! They would need to pay some big buck to sway another studio- but this would only make the format war worse!

I cant see HD DVD winning, and now I cant really see both living side by side either!

[Starburst]

Originally Posted by Adam_uk

I really think this is a knock out blow for HD DVD- which is a shame as I love my XE1 and the format.

Yep, it may not be the one punch stoppage but for the first time since the two formats went head to head this decision (at least for me) is a critical one far more so than Paramount.
Regardless my XE1 will grace the AV rack until it fails, I have plenty of movies now and more still to come from Universal and Paramount (Warner till May) plus the overseas rights holders for US BD exclusives.

As to the future of HD DVD how much is Toshiba willing to spend to keep it in the "war" and if not can they do deals with major DVD manufacturers to become the replacement for all but the highest end DVD upscalers?
In other words sell them off the back of the high quality scaling at sub £100 and even supermarket prices and let the BD camp decide how to market Blu-ray with the PS3 at one end and £1000 standalones at the other.
The HD war would be over in name but the HD DVD drive could have a very good future at the right price point.

[tonyk79]

Warner as any business are driven by profit and Warner know there is 8 million PS3 out there and stand alone players compared to how many HD-DVD players.

If I was Toshiba or the HD-DVD backers I wouldnt give up the fight yet as Blu Ray is not that successful either. What they need to do is get the average member of the public on board and they need to do this via two main ways.

Average Joe Public will not spend more than £100 on a DVD player, if they can get HD-DVD down to this cost then they have a chance of convincing the Average Joe to buy this instead of a DVD player. Show him the difference in the retail show rooms, dont just have them sitting on a shelf doing sweet FA like they do in Currys and then saying giving me £200+ for it and the guy standing looking at the £50 DVD player sat next to it thinking why should I pay £150 more?

They then need to address the pricing of the discs as I think this is the real reason many arent switching from DVD, Its not confusion over formats! You can buy DVD Superman Returns for £4.99 or the HD-DVD for £23.99, how many people are going to spend an extra £19 when they know what DVD can do? Another Example from HMV,, Batman Begins £4.99 DVD versus £17.99 on HD-DVD!

Get Market penetration and Warner and all the other studios will want to make money on the format with the largest user base as this where the money comes from. Currently its Blu Ray with the user base.

[lfletcher]

For me this is the first nail in the coffin. I believe HD-DVD's ultimate fate will be handed to them by how the retailers take to this news.

[Rasczak]

Originally Posted by lfletcher

For me this is the first nail in the coffin. I believe HD-DVD's ultimate fate will be handed to them by how the retailers take to this news.

The retailers will stock what sells - so I would suggest it is the consumers that will decide HD DVDs fate now. If people have lost confidence in the format then it will wither and die, if not it won't. It's as simple as that IMHO.

I was looking in HMV at the week-end , blu ray has a far greater film Catalogue now then HD dvd , does this mean blu ray looks the stronger format ? i guess this year will tell

[MI55ION]

Originally Posted by richard plumb

I don't think Warner took anyone for a ride. From the sounds of it they were seeing what both sides had to offer.

I sense that this whole format war was strategically played from the beginning and one that Warner could have avoided by going Blu-ray exclusive from the start, why didn't they? Because and I'll quote the man himself Jeff Bewkes, President and Chief Executive Officer, Time Warner Inc.: “Warner Bros. has produced in both high-definition formats in an effort to provide consumer choice, foster mainstream adoption and drive down hardware prices.” 'Consumer choice' has nothing to do with their decision here, the consumers have not chosen, the corporation has. Why are they in such a hurry now, well because and I'll quote again “The window of opportunity for high-definition DVD could be missed" because they want to secure their revenue for the next 8 to 10 years i.e. get people to replace their DVDs before downloads or whatever next gen format takes over.

So the key point here is that the most powerful studio has outmaneuvered everyone else in this war (including Toshiba, Microsoft and the legions of consumers the world over that have bought into HD DVD) so that blu-ray hardware prices can be brought down quicker. From the studio's perspective, the only conclusion from this format war is that it has brought down prices of hardware far quicker than if a single format was in existence.