High-def DVD battle heats up

Warner might soon choose a side

Walt Disney Studios Home Entertainment worldwide president and Blu-ray Disc proponent Bob Chapek on Tuesday blasted the rival HD DVD camp for prolonging the format war when it is clear that Blu-ray is the odds-on favorite.

"Blu-ray's competition's attempts to sell less than the best will inevitably be trumped by what we stated from the very beginning: That the Blu-ray technology is not a half-step format that will sell consumers short, but rather it is a revolutionary technology that will change the way we view movies for the long term," Chapek said near the conclusion of a two-day Blu-ray Festival in Hollywood.

"And we firmly believe that revolutionary technology, my friends, is indisputably, undeniably and inevitably Blu-ray."

Chapek's fierce rhetoric, coming during a gala Disney launch party for Blu-ray editions of "Cars" and "Ratatouille," underscores the enmity in Hollywood between the studios supporting Blu-ray and those behind next-generation rival HD DVD. Disney, along with Sony Pictures, 20th Century Fox and Lionsgate, are exclusively in the Blu-ray camp. Universal Studios and Paramount/DreamWorks only support HD DVD, while Warner Home Video, at least for now, releases titles in both formats.

While studies finger consumer indifference as the chief obstacle the studios face in getting movie lovers to transition from standard DVD to high-definition disc, the format war has tapped resources and confused consumers, prompting many to hold off buying either a Blu-ray Disc or an HD DVD player until a uniform standard emerges.

Studio executives in both camps concede the stakes are high: the very future of the packaged media business, for years Hollywood's biggest cash cow. Executives fear that if the format war is not resolved, allowing them to pool their resources behind one standard high-definition disc format, the decline in DVD sales will continue, and consumers uncertain about which new format to buy will go online for their entertainment needs.

Chapek isn't alone in his harsh statements. At a presentation Monday on the Fox lot, home entertainment president Mike Dunn chastised Paramount Home Entertainment, which a month ago dropped its support for Blu-ray and went exclusively with HD DVD. He accused the studio of "taking the bait," referring to a reported $50 million payout, to align itself solely with the HD DVD camp, which is led by Microsoft and Toshiba.

Dunn also intimated that the format war is being perpetuated by Microsoft in the hopes of confusing consumers so much that they don't support either format and ultimately buy their entertainment online. He didn't name the computer giant by name but blasted "the orchestrated campaigns of confusion and anti-consumerism fueled by an 800-pound gorilla that would prefer to force us all into the practice of paying tolls for the right to exchange information and enjoy entertainment."

Despite the sharp tongues of the studio presidents, the biggest buzz at the Blu-ray Festival was generated by the likelihood that Warner may soon align itself exclusively with one camp.

In an interview, Dan Silverberg, vp high-definition media at Warner, admitted "one thing that may be changing is our strategy," and that a change could come as early as the end of the fourth quarter.

"When both formats launched and hardware prices were high, we made a decision to support both formats and let the consumer decide," he said. "But now that hardware pricing is affordable for both Blu-ray and HD DVD, it appears consumers no longer want to decide -- so the notion of staying in two formats for the duration is something we are re-evaluating now that we are in the fourth quarter."

Silverberg noted that Warner has the top-selling Blu-ray title of all time with "300" and is consistently No. 1 or No. 2 in both Blu-ray sales market share and in number of Blu-ray titles in the market.

"We can definitely talk Blu-ray," he said. "We are committed to the format."

A Warner source said the studio is watching what happens now that Wal-Mart and other big retailers are selling entry-level Toshiba HD DVD players for less than $200, about half what the cheapest Blu-ray player costs. If there is a significant spike in HD DVD software sales, the studio may cast its lot with that format, whereas if there is no real impact, Warner may go Blu-ray only.

Blu-ray is supported by the lion's share of consumer electronics companies, while only Toshiba makes a dedicated set-top HD DVD machine. The Sony-developed format received another boost during the Blu-ray Festival when the Home Theater Specialists of America, a national buying consortium of 62 dealers and 800 installers with combined annual revenue of more than a half-billion dollars, officially endorsed Blu-ray Disc as its next-generation format of choice.

The decision, according to director David Berman, was reached after a membership survey found 92% favoring Blu-ray over HD DVD.
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