The bombshell: Warner Bros announces they’re dropping the HD DVD format to exclusively produce Blu-ray Discs. The aftershock: HD DVD Promotion Groups cancels their press conference. This seemed to be the most discussed topic in the days leading up to CES, both on-site and online.
At this point, the next generation optical disc war has been won – Blu-ray is the undisputed champ. The only questions that remain are how long will HD DVD linger and how soon will Dave ebay his HD DVD player? Having said that, adoption will still be slow until Blu-ray hardware prices drop further and less HD DVD hardware is found on store shelves. The hot Christmas gift of 2008? BRD.
It’s not OVER yet. It’s just…looking very, very bad for red. Y’know, everyone always compared the format wars to the VHS/Betamax format war, but it didn’t occur to me until recently that this go around, HD DVD = Betamax. it’s too bad, too…it really was the more consumer-friendly standard.
I will buying HD-DVD as long as they make them. A whole lot less buggy then BRD. Better features and less expensive too! Players and discs will last 10 years anyway.
“Having said that, adoption will still be slow until Blu-ray hardware prices drop further and less HD DVD hardware is found on store shelves.”
“ItÂ’s not OVER yet… everyone always compared the format wars to the VHS/Betamax format war…”
I don’t really remember the VHS/Betamax format war, but I don’t think that Betamax Video Cassette Recorders were twice as expensive as VHS VCR’s.
Hmmm… RCA VHS VCR was $300 less than Sony Betamax VCR. That sounds like right where we are today (except I doubt the RCA VHS VCR sold for $150 back in the day, making a $300 dollar difference in price now a much bigger percentage of price now). Just substitute Toshiba HD DVD player for RCA VHS VCR and Sony Blu-Ray player for Sony Betamax VCR.
“While price later was less of a factor, in 1977 the VHS manufacturers, led by Matsushita, got into the trenches. VCR prices dropped as they became cheaper to make. RCA led by dropping prices $300 below the Sony machine, which caused an avalanche of follow-on price cutting. Eventually even Sony was forced to drop its price by $200.”
http://tafkac.org/products/beta_vs_vhs.html
“SEP. (1977): RCA introduces the VBT-200 VHS deck in U.S. at $995; first two-speed VHS deck.”
http://www.betainfoguide.com/Tidbits.htm
It is over, really. Even the HD DVD players are reeling. Instead of responding aggressively and making their planned announcements and ‘we will fight on’ etc, we got a couple of week press releases and *all* announcements were canceled. And smaller studios have started following Warner – either switching from HD DVD to neutral, or from neutral to Blu-ray. I don’t think anyone seriously expects HD DVD to last through 2008, the only question is when Paramount and Universal will offer Blu-ray – not if.
As for pricing, Toshiba has been subsidizing their players – selling them for less than they cost to make – to try to gain market share. And if didn’t work. That’s also why you don’t see a lot of HD DVD hardware vendors – it is hard for someone else to enter the market and make money when Toshiba is undercutting them with subsidies. That’s why Thomson/RCA exited the market. The Onkyo model is a rebadged 2nd gen Toshiba, and Venturer isn’t selling – why buy Venturer when the equivalent Toshiba is less?
Blu-ray hasn’t be subsidizing their players, which is more sustainable. Even with that, the natural progression has seen prices drop so that players are selling for sub-$400 regularly, and sub-$300 MSRP players were announced at CES. Which means they’ll be selling for a lot less than $300 online. We’ll probably see Blu-ray decks under $200 by the holidays.
Even with the price advantage this holiday season HD DVD failed to displace Blu-ray, which was one of the key factors in Warner’s decision.
Over is a tad premature. Until Paramount/Dreamworks and Universal all announce they support Blu, then everyony HDM fan must have HD DVD to watch many great movies. Albeit quite possible they may wave the white flag, it seems odd to pretend you can predict the future when many cards are yet to be played. I for one like the competition and the $129 prices seen at many online retailers this week for an HDM player.
Nah – it is over. It is just a question of when the studios give in, not if. Toshiba seems to have dropped the MSRP on their units, looks like a last ditch attempt to grab sales. But even with the $99 sales during the holidays Blu-ray hardware held its own in volume.
The only thing buying HD DVD hardware or movies can do at this point is drag out the death throes a bit. The faster people stop buying it, the faster retailers will drop it. There are already rumblings of retailers dropping HD DVD to force a quick end now that Warner has jumped. And with HD DVD being called dead in all the mainstream media, it is going to hurt their sales.
I don’t think even Toshiba seriously expects HD DVD to last now. They were clearly stunned by Warner’s move and couldn’t do any damage control. There have already been comments from users on various blogs that they’re returning their new HD DVD players before the return window ends.
The best thing that could happen now is for Best Buy or Wal*Mart to stop stocking HD DVD, that’d shove Paramount and Universal to Blu-ray pretty fast. They’re already giving Blu-ray more shelf space than HD DVD.
There is no need to buy HD DVD – just wait and those movies will be on Blu-ray. The fewer movies you buy, the faster it will happen.
It’s a bit unfair to say that Sony hasn’t been subsidizing the cost of Blu-Ray players, because without the “Trojan Horse” of the Playstation 3, the format war would probably be still a stalemate or tipping towards the red camp. They’re only just NOW breaking even on PS3s, and that’s after stripping it down and bleeding cash for over a year.
Like a lot of people, I imagine, I’m up on the newest tech and I have a beautiful HDTV, but I was sitting out the format war. I really wanted HD-DVD to win, because it’s got a more complete standard, easier to manufacture, etc. But I don’t have the kind of disposable income to spend on a technology that may not pan out, so I couldn’t “vote” for my format of choice. The studios are desperate to control their content, and BD+ is supposedly the better copy protection. And of course, no other equipment manufacturers contributed to HD-DVD, leaving Toshiba in the unenviable position of being the “Sony” this time around. Maybe there’ll be a place for HD-DVD in the future, just like the niche market for UMD and, up to a few years ago, Mini Disc…
Maybe Toshiba and Microsoft should get with the Blu camp and work on a Blu-ray 3.0 that supports HDi as well as BD-J — and possibly even HD-DVD discs. That way, all the former red exclusives can be ported over easily without missing out on anything. But before I buy ANY HDM format, they need to get a finalized, internet connected standard for under $200.
The “War” is really between HDM and DVD. I am not sold in any way that Blu can actually ever achieve that while HD DVD has the ability to effectively tansition the market via Twin Layer Discs by eliminating the DVD sku altogether. So forgive me if I hold out hope for HDM via HD DVD.
Even without Blu-ray, the HD DVD/DVD hybrid discs were already fading because of costs. It costs more to produce a hybrid than it does to produce separate HD DVD and DVD discs, due to lower manufacturing yields. The exact same thing killed DVD18 – it is cheaper to press two DVD9s than one DVD18. So the studios were already moving to bundle packs with two discs – which, of course, Blu-ray can do as well.
And Blu-ray can do hybrids – two kinds actually. Dual-sided with DVD9 on one side and BD50 on the other is the simplest. And isn’t hard for them to do. They can also do single-sided with DVD9 ‘under’ a BD50 layer – the red laser reads the DVD content through the blue laser layers.
But these haven’t been used in commercial products because of the costs – again, it is cheaper to press a BD and a DVD than to press the hybrid versions.
The hybrid discs have just never been a real factor in the war at all.
The Combo discs (flippers as some call them) do suffer from some of the cost issues you noted above. The real strength would be the upcoming Twin Layer Discs with 2 layers of HD DVD and 1 layer of S DVD all without flipping or gluing anything. The concept has already been used for 1 single layer of both and is well on its well to full implementation.
The three layer discs are vapor – and I’d be willing to lay money we never see a single three layer HD DVD commercial disc. The problem with both the dual-layer hybrid and the three-layer hybrid is the lack of space. A DVD5 is too small for most commercial releases – very few DVDs are DVD5s these days because you have to over-compress the material to fit.
That was one of the problems in the early days of DVD. Since DVD9s had a high failure rate, until they got the bugs worked out, a lot of titles were crammed onto DVD5s. And they looked like crap – I bought several of those, being an early adopter.
The DVD5/HD DVD15 hybrids suffered from having too little space for both formats – unless it was some really short content. So those never went anywhere.
The DVD5/HD DVD30 solves the problem for HD DVD (as best HD DVD can anyway), but you still get stuck with a DVD5 for DVD content, which is miserable.
On top of that, the reject rate will go up in manufacturing. Any time you add a layer to a disc you compound the failure rates as each step in the process adds some reject. Plus manufacturing three-layer discs requires modifying the production process, and that was HD DVDs ‘big advantage’, being able to use DVD machinery with few modifications. So it loses some of that.
None of the HD DVD studios have suggested that they will adopt three layer discs. For that matter, there has been no news of any of the pressing plants considering adopting it yet. It was only recently approved by the HD DVD Forum as a spec. And while Toshiba says their 2nd and 3rd generation HD DVD decks will handle it (but probably not the 1st gen), there hasn’t been any real testing with all the DVD decks in the field.
Along the way DVD players have had issues with the first dual-layer discs, then DVD-R, DVD-RW, DVD+R, and DVD+RW, and then the dual-layer writable discs, because of the different geometries and reflectivity of the different formats. Will any players have issues with three layers and the variances therein? Probably some will, most probably won’t, but it is hard to say.
At this point, with the massive lead Blu-ray has, there is little incentive for the HD DVD camp to invest in tooling changes to produce three layer discs. They’d have to gamble that the format would be in production long enough to pay off the changes, and that takes years.
At the end of the day, it’s all about the content… and I firmly believe we’ve reached the tipping point.
Dave (and esp MegaZone), thanks for all the details.
Like others I have sat out this format, and while I’d predict its over, I’m still not willing to jump in. I’d like to see the end-game play out with Universal and Microsoft and Paramount switching. I’d like to see BluRay under $200. And I still don’t want to buy an early version player with the slow startup, no internet, no interactive content, maybe incompatibility with BD+, etc. I’d also want to make sure we have the whole ripping thing worked out. And I’ll want a BD drive on my PC at a reasonable price that can also handle multi-format DVD burning, etc etc. I might jump earlier than all of this, but not by much…
Glenn,
I think your requirements will be met before the year is out. At CES sub-$300 BD players were announced. Sold online they’ll probably be sub-$250 to start, and fall from there. I think we’ll see sub-$200 this year.
Sony also announced a $200 computer BD drive which is also a DVD Multi-format burner.
All DVD players introduced since October 2007 are required to be Profile 1.1 aka Final Standard Profile aka Bonus View, which provides for PIP, etc. The one last variable is Profile 2.0 aka BD-Live which is Internet connectivity. Some players have been announced with BD-Live support, others have the hardware and are expected to be firmware upgraded. (Sony confirmed the PS3 will get an update to BD-Live.)
Things really shifted into high gear at CES with both the low end and high end jumping on Blu-ray. At one end you have sub-$300 players from Funai (likely to be sold under the Sylvania brand) and $2000 BD players from Marantz.
“The only thing buying HD DVD hardware or movies can do at this point is drag out the death throes a bit. The faster people stop buying it, the faster retailers will drop it. There are already rumblings of retailers dropping HD DVD to force a quick end now that Warner has jumped. And with HD DVD being called dead in all the mainstream media, it is going to hurt their sales.
I donÂ’t think even Toshiba seriously expects HD DVD to last now. They were clearly stunned by WarnerÂ’s move and couldnÂ’t do any damage control. There have already been comments from users on various blogs that theyÂ’re returning their new HD DVD players before the return window ends.”
HD-A3 and HD-A30 are the top sellers (among DVD players and High-Definition Video disc players) at Amazon.com and BestBuy.com, respectively. Aren’t these the top two sellers of high-definition media?
It apparently isn’t hurting sales (the new price points).
I believe Wal*Mart and Best Buy are the top sellers of media.
But the increase player sales don’t matter – it has happened before when Toshiba had sales on the players and there was no associated jump in HD DVD media sales.
Also, it is a bit deceptive. Since Toshiba is basically the only HD DVD vendor all the sales are concentrated into a couple of models, while sales of Blu-ray units get spread over many models – making it much less likely any of them enter the top spots.
The Toshiba units have regularly been higher on the sales rankings for a long time – yet overall HD DVD and BD roughly split standalone player sales last year. Not counting the PS3, of course.
I expect them to sell more with the lower prices, but I doubt we’ll see any big shift to HD DVD in media sales. I actually expect BD to expand its lead over the next few months as Warner’s releases bias toward BD and eventually HD DVD is dropped.
“Since Toshiba is basically the only HD DVD vendor all the sales are concentrated into a couple of models, while sales of Blu-ray units get spread over many models – making it much less likely any of them enter the top spots.”
Sony, Samsung, and Panasonic sell the most stand-alone Blu-Ray players. Sharp (who is normally a bit) is selling quite a few players this week because they are being given away with select 42″+ 1080p Aquos TV’s. Pioneer makes the majority of Blu-Ray players sold which are rebadged as either Sony and/or Samsung and/or Panasonic Blu-Ray players.
“I believe Wal*Mart and Best Buy are the top sellers of media.”
Wal*Mart is the highest seller of DVD media. I don’t believe they sell much Blu-Ray and/or HD DVD. Their selection in hi-def media is pretty poor — I wouldn’t be surprised if Circuit City sells more hi-def media than Wal*Mart.
“Sharp (who is normally a bit” PLAYER) “is selling…”
Leo – While Pioneer may build the players, it won’t reflect in the rankings since they’re ranked by the make and model they’re sold under. And there are more players to split the sales over. The HD DVD market is artificially concentrated on Toshiba.
MegaZ,
My point was there are a lot more Blu-Ray players, but most of them are quite unpopular — notably the Pioneer self-branded units, Phillips units, and Sharp units (when they aren’t bundled with a 1080p Aquos HDTV). That’s a lot of big names that aren’t selling many players at all.
But it does add up – BD managed to take about half the standalone player sales in 2007, counting the Xbox drive and not counting the PS3. And that’s with HD DVD’s price advantage. Their ability to do that (plus the PS3) combined with a sustained advantage in media sales has been key.
“BD managed to take about half the standalone player sales in 2007, counting the Xbox drive and not counting the PS3.”
BD has managed to take about half the standalone player sales since inception, counting the Xbox drive and not counting the PS3.
1 million Toshiba (and RCA and Venturer) HD DVD players & Xbox 360 add-on HD DVD drives
500,000 Blu-Ray stand-alone players
3 Million PS3’s
I meant to say BD has managed to take about one-third the standalone player sales since inception.