Next-generation DVD format war frustrates retailers

Reuters ^ | 1/8/06 | Franklin Paul

[wagglebee]

LAS VEGAS (Reuters) - Consumers, confused over the brewing battle between next-generation DVD technologies, are not alone: top U.S. electronics retailers at the Consumer Electronics Show in Las Vegas called the war "nightmarishly unfriendly" and "stupid."

Stores like Best Buy (BBY.N: Quote, Profile, Research), Circuit City (CC.N: Quote, Profile, Research) and closely held CompUSA may sell millions of devices, either HD DVD or its rival, Blu-ray, and some day one version could be obsolete, drawing the ire of their customers. What's more, many will chose not to buy any device, instead waiting for one format to win.

Blu-ray is backed by Sony Corp. (6758.T: Quote, Profile, Research) and HD DVD is championed by Toshiba Corp. (6502.T: Quote, Profile, Research) The two technology camps failed to reach a unified technological front, setting the stage this year for a format war like the costly VCR vs. Betamax battle of the 1980s.

"We are frustrated," said Best Buy CEO Brad Anderson on Friday on the sidelines of a panel discussion at CES, the industry's biggest U.S. trade show. "We are going to wind up with some number of consumers probably buying a format that dies, and we are probably going to wind up having to sell it to them. They are not going to be happy with us."

Both Blu-ray and HD DVD backers hope to spark the sagging home video market with new high-definition DVD players and discs, offering greater capacity and interactive features.

"The problem is that what you want is huge penetration into homes as quickly as possible," said CompUSA Chief Executive Larry Mondry. "The Beta-VHS wars lasted 10 years. We are doing it again and we are just stupid as an industry.

"I don't care which way it goes, I just want it to go one (particular) way," he added.

Starting this year, it is likely that electronics retailers are going to have to make space in their stores for sundry devices related to both formats, including DVD players, movies and other programming that play on them, and accessories.

Those boxes will crowd against standard DVD players, as well as digital video recorders, like those made by TiVo Inc.(TIVO.O: Quote, Profile, Research), creating many -- perhaps too many -- choices for shoppers who want to enjoy advanced TV viewing features.

Decisions on what to stock will have to be made by the retailers sooner rather than later. At the Consumer Electronics Show in Las Vegas, Toshiba and Thomson (TMS.PA: Quote, Profile, Research) each announced plans to sell in the next few months high-definition DVD player in the United States priced at around $500.

Blu-ray backers such as Philips Electronics (PHG.AS: Quote, Profile, Research), Matsushita (6752.T: Quote, Profile, Research) and Samsung Corp. (000830.KS: Quote, Profile, Research) aim to sell devices this year, as will Sony, whose next version of the popular PlayStation game machine will play Blu-ray disks.

Both camps have lined up Hollywood movie studios to release movies on the new formats, some exclusively on either HD DVD or Blu-ray disks.

"Customers clearly have an appetite for high-quality content. The shame is it is going to take longer than we need it to," to get it to them, said Circuit City Chief Executive Alan McCollough, during a panel discussion at CES.

[wagglebee]

I have several hundred DVDs and I buy more every month, it looks like I may have to buy two new DVD players to be able to play the new ones.

[apackof2]

So does that mean that PCs and laptops that have DVD
players and writers be will obsolete also?

And you would have to buy a new external DVD?

[Pimpmygop]

Umm? how about multiformat Dvd Players? How hard is that, they do it with burners all the time. I sell the top of the line multiformat burner/reader right now for $69.00 and it burns and reads everything thats currently out there. I home unit that would have multiformat wouldnt be a big deal to make, and im sure thats the way they are going to go. It will be expensive at first and like all things it will become dirt cheap. I paid $600.00 for my first DVD player in 1997, can get one for $19.00 bucks if you look hard enough.

[webboy45]

I predict that in 2-3 years an improved blu-ray disk will be available with twice the capacity of the current one. I just don't believe that blu-ray has had enough development at this time to be considered a mature product. It's possible that the new machines would read both old and new blu-ray disks.

[Publius6961]

What's more, many will chose not to buy any device, instead waiting for one format to win.

Count me in among this group... permanently.

We have seen enough of this in the past so that only the idiot, or the fool with more money than good sense, will continue to play that losing game.

[netmilsmom]

If it's Sony, it will go the way of their Beta tapes.

[kingu]

HD DVD, Blu-Ray - who cares? I mean, you're talking about real esoteric stuff to most consumers who would like to see affordable HDTV displays and digital tv receivers. I'm not shelling out $800 to watch tv in the bedroom, yet no one has addressed this yet.

Portable digital televisions would also be a nice thing to see on the market. A large portion of the population has LCD screens in their cars for entertaining the kids, yet getting a digital television receiver setup in a vehicle is still a thousand dollar proposition.

They're getting well ahead of the technology curve and that's what is sagging the market. Most everyone in the US will have to buy new televisions or adapters in the coming year to be compatible with the digital television initiative yet most manufacturers can't seem to find the interest in producing these devices.

[Publius6961]

I will make the safe prediction that the lower-priced one will prevail, so long as the performance is adequate. This has been the rule for 30 years now...

[rbg81]

So what happens to the "old" (current) DVD format? Anyone happen to know how the current format plays on HDTV? I didn't mind spending $$ to replace my VHS tapes with DVD (well worth it), but don't want to update my collection every time a new technology rolls out.

[P.O.E.]

There's a ton of info lost because it's on old formats, such as 16mm film. There are speeches by Eisenhower possibly lost to posterity simply because there are few players for the 2" wide Quadruplex video tape.

Where's the Rosetta Stone for future archaeologists?

[tje]

I have probably 100 dvd's that I've watched once and rarely every again. I can watch pay per view HD movies that look and sound great. I would prefer to bypass the hardward and go directly to pay per view with someone who has a library like Netflix. (Netflix is my main source of movies.)

I will not buy hardware until this is sorted out. I will not get burned by this.

[Publius6961]

So does that mean that PCs and laptops that have DVD players and writers be will obsolete also?

I suppose the answer is "yes", but only insofar as HD movies are concerned.
I don't see non-HD movies becoming unavailable any time soon. And the equipment for viewing them is now mature and as low-priced as it will ever be.

The existing letterboxed non-HD movies are plenty good for me. I just watch movies, not make trendy "mine's bigger than yours" statements with my electronic equipment.

[JustAnotherOkie]

What will tell the tale? We all know VHS was technically inferior to Beta. Sony held on to make it a proprietary standard demanding royalties and it flopped. Same with Apple, it is a bit player because they wanted to own everything. The most open design with the least royalties will win. By the time the haggling is over someone else may sneak in and win.

[sittnick]

If it's Sony, it will go the way of their Beta tapes.

And the way of mini-disc, and the way of ATRAC, and the way of MSX, etc.

[wagglebee]

I was buying a new DVD player at Best Buy a while back, it's just for a TV near my computer so I can put on a movie to watch in the background while I'm online, so I was just getting one of the cheaper ones. The salesman/cashier looked at me funny when I told them that I didn't want to buy an extended warranty, I told them that if it broke in a few months that I would just come back and spend fifty bucks on another one.

[bobdsmith]

the solution is bittorrent

[RedMonqey]

There will be no Rosetta Stone and you are right, information will be lost.


Think of all the books lost when the libaries of Alexandria were burned.

Lots of history has been lost. Yet the world goes on.

[Mark was here]

Consider the deal with root kits from Sony, when deciding what products to invest in.

[Crimson Elephant]

HD-DVD will almost assuredly become the winner, at least in mainstream home usage. Why? They are (the last time I read about it) going to be backward compatable with old DVDs. It also has the advantage of being the next gen of DVD, something that sounds like the old format.

Blu-Ray will survive as long as Sony wants it to because it is the basis for the Playstation 3, and, if memory serves, can hold a lot more than HD-DVD. Either way, they will take over because HD content will eventually rule, and the "full immersion" video games will be FAR closer to reality with this technology.

[JoJo Gunn]

http://www.lionlmb.org/quadpark.html