/ 30 August 2005

Rivalry hots up for next-generation DVDs

The two rival camps in the battle over next-generation DVD standardisation are looking forward to the International Radio and TV Exhibition in Berlin from September 2 to 7.

Since consumers will likely decide the winner — Blu-Ray or HD-DVD technology — producers are eager to impress them with devices in the new formats.

Consumer electronics industry experts generally agree, however, that the respective disc drives and recorders probably will not hit the German market until 2007. Once they do, though, things could move very quickly.

Sony’s Playstation 3, which will feature a Blu-Ray disc drive, could get out of the gates early. Its appearance is expected sometime next year. Industry analysts believe Playstation 3 and Microsoft’s Xbox 360 console — with its high-resolution games — could give the market for high-definition video a bigger initial boost than HDTV or DVDs.

Next-generation DVD formats are being held back mainly by a lack of content. Recorders for high-definition fare are simply not needed yet. The German pay-TV operator Premiere plans to broadcast the first high-definition TV (HDTV) programmes in Germany in November.

In line with conditions set by Hollywood, Premiere’s HD movies will be recordable on decoder hard discs at best. The first DVDs in the new formats will go on sale in the United States around the end of the year.

Toshiba and NEC, which are pushing HD-DVD, have experienced setbacks of late. The big Hollywood studios Warner and Universal — in the HD-DVD camp — announced they were reducing the number of titles in the format for release this year.

Moreover, two other important studios, Twentieth Century Fox and Lions Gate Home Entertainment, have cast their lot with Blu-Ray, whose proponents include consumer electronics heavyweights Sony, Panasonic and Philips, as well as PC makers Dell and Apple.

Twentieth Century Fox pointed to what it said was HD-DVD’s weaker protection of copyrighted content, promptly drawing a rebuttal from the format’s developers. The subject has been a sore spot in the movie industry ever since DVD protection was cracked and consumers started burning copies indiscriminately.

The Blu-Ray camp has begun wondering aloud how its rival intends to prevail against the power of the industry’s giants. Other Hollywood studios — Sony-owned Columbia Tristar and MGM, as well as Disney — have also come out in favour of Blu-Ray.

HD-DVD’s backers have not given up, however. The president of Toshiba, Atsutoshi Nishida, told the British Financial Times that his company will put HD-DVD devices on the market — as planned — at the end of the year.

An advantage of HD-DVD, experts say, is that existing production equipment can be used in part, thus cutting costs. There are now triple-layer, 45-gigabyte HD-DVD discs.

Blu-Ray comes in discs with two layers and a capacity of 50 gigabytes — in theory up to 200 gigabytes. Meanwhile, observers warn that film studios’ support, while valuable, cannot be banked on.

Once devices in both formats hit the stores, studios will hardly turn up their noses at the huge revenues to be had in an ”alien” format. After all, Hollywood makes more money with DVDs than it takes in at the box office.

And not to be forgotten is the possible role of discounters, who can turn new technologies into common commodities — as happened with DVDs.

Either there will be agreement on a standard after all, or we are in for a long, costly ”war of the formats” in which consumers will have to resort to expensive, hybrid disc drives. Talks between the two camps broke down last spring — reportedly because both sides were too proud to give in.

Toshiba’s Nishida said recently, however, that the door for more negotiations is open. — Sapa-DPA