For more than a year now, the impending blue-laser disc format wars have been looming. But what’s the benefit to consumers for rushing the technology to market?
Those who follow the future of optical drive technology have heard nothing but Blue-ray versus HD-DVD for ages. We’ve watched a new format war brew over these blue-laser based technologies, with both the Blu-ray Disc and HD-DVD camps battening down the hatches for a long, drawn-out conflict. At stake for the industry is who will control the market for delivering entertainment content in the future. For those of us who’ll be consuming that entertainment, the conflict is more about which technology to invest in for the long haul.
Contrary to popular belief, the consumer electronics industry knows all too well the risks of taking competing formats to market. Consumers aren’t the only ones with memories of the decades-old VHS versus Betamax debacle.
The two camps did meet earlier this year in an effort to reach an agreement before products began shipping. Unfortunately, since the talks broke down in the summer, the situation has spiraled downhill. Members of each camp still talk bravely about coming to market with products this year – Pioneer says it’s completing work on a Blu-ray Disc data recorder for the PC, while NEC is readying an HD-DVD player for the PC. Both products are yet to surface. Both could hit by year’s end, but only if the AACS content protection controls adopted by both formats can be finalized in time to meet already-tight production schedules.
Toshiba, meanwhile, said earlier this year it would launch consumer HD-DVD players in 2005, but at this time the company is tight-lipped, saying only that it’s talking with its content partners.
But there’s more to this soap opera, beyond the battle for lucrative future licensing royalties. I hear from some insiders that the possible delay in HD-DVD’s launch could leave the door open for renewed talks of detente between the two camps. The original plan, announced by HD-DVD backers at the Consumer Electronics Show in January, called for HD-DVD products to be on shop shelves by this fall. The two proud competitors have been backed into a corner, and neither is willing to give ground. There’s a back story here, some of which is public (such as the original battles for the current DVD format), and some of which is not. As things stand, the winner takes it all.
What’s going on behind closed doors in Japan may be anyone’s guess, but the harsh reality is that a format war would be unwelcome to manufacturers and consumers alike. Each would face a complex web of choices if both formats go to market, and both could delay making decisions because of a format war.
Industry analysts rightly point out that the number of HDTV owners (who are the most likely buyers of next-generation optical drives) is too small to support a product launch. JupiterResearch’s recent consumer survey found that only 11 per cent of online US households have TVs or set-top boxes capable of high-definition playback. You may well question why the industry began talking big about rushing to market this year – or even early next – considering that high-def television adoption has been dragging.
IDC research director Wolfgang Schlichting says: "it will be the year 2009 before we see [these] technologies making a significant impact on the market."
One reason for this delay is that consumers aren’t motivated to graduate to the next level. "For must users, DVD will be good enough, for a long time – because [standard] DVD still looks quite stunning on 46-inch or 50-inch TV," Schlichting points out. His perspective is one that’s quietly echoed by many in the industry, and even by savvy consumers. Because of this, Schlichting adds, "Price is going to be a really important factor [in the market’s growth]."
Getting HD out there
Market pundits forecast the surge in demand and potential growth for high-def content delivery to still be three or four years out. After all, we still need to get the high-def televisions out to the masses, and convince those who aren’t couch potatoes, movie aficionados, or sports fans that high-def content is worth the extra dough. These issues go hand in hand.
Sony’s PlayStation 3 ups the ante considerably in Blu-ray Disc’s favour. This is obvious, given that the PS3 will have a Blu-ray Disc drive inside, and the PS3, due next year, is expected to do wildly well in sales. That said, not all PS3 buyers will have an HDTV – and those who don’t are unlikely to be motivated to buy the high-def Hollywood movies that are widely expected to be the strongest drivers behind the adoption of a high-def optical format.
If a format war were averted, demand for high-def playback and recording could outstrip current expectations. Unlike with previous format wars, savvy users are watching this unfold play by play on the Internet, on news and technology gossip sites. I think it’s safe to assume that all of this talk, and cross-talk, is lowering users’ expectations as to what they might want, and by when. But with the right content, and the right circumstances – no format war, lower-than-expected prices – high-def optical could get more of a running start than anyone is anticipating.
With HDTV prices dropping, more people might just consider upgrading sooner – especially if the big movie releases were available.
However, the way things stand, the big film companies are divided on which format they support, so wide scale release of everyone’s favourite movies is out of the question.