High-Def DVD: It’s Over!

I was probably one of the first to pick HD DVD as the winning format in the high definition video disc contest. It had the backing of enough of the Hollywood studios to be competitive. Warner Brothers had a clever multilayer design that would play in both DVD and HD DVD players. The Blu-ray camp did its best to drive the porn industry to HD DVD. Movies that were “exclusively” Blu-ray were available as HD DVD through European distributors. But the biggest reason of all was value; the HD DVD players cost about half as much as an equivalent Blu-ray player.

And I was wrong. Reports from various sources including Reuters indicate that the Japanese broadcaster NHK has announced that Toshiba plans to cease production of its HD DVD products. If this turns out to be accurate, it comes as no surprise after the barrage of recent bad news about retailers pulling their support for the format.

So what happened? Was it technological superiority? It certainly was not that Blu-ray is a better value. And it’s not just the studio support, because hardly anyone has been buying high definition discs of either format. (Both camps resorted to giving movies away by the handful in an effort to boost sales figures.) I conclude that it was a combination of deep pockets and marketing accumen. I have not read anything official, but I have to believe that were were financial incentives involved somewhere in convincing Warner Brothers to switch allegience. And the timing of the announcement — right before CES — was a brilliant piece of strategy. Then last week saw the bludgeoning series of announcements from Netflix, Best Buy, and Wal-mart, all shifting in favor of Blu-ray. Sure, the timing could have been coincidental, but I easily could be convinced that these announcements were orchestrated for maximum impact.

The bottom line here is that I expect the folks at Sony decided that they did not want a repeat of the Betamax failure, where the company apparently believed that technological superiority was sufficient to carry the day. This time around, I think they applied some pressure in the right places at the right times, guided by a savvy strategy. And now Blu-ray has won.