So there’s this little thing called the Consumer Electronics Show out in Las Vegas where all the big tech companies come together and show off all the geek service they’ve got lined up for the following year. Everyone except for Apple, that is, who has their own little bash a week later to be fashionable. But this year, the overlap of CES with the political cycle makes for some interesting and informative analogies. Consider this. Two candidates, each representing change from the current status quo, each promising vast advantages and benefits and superior experience. Both are locked in a drawn-out battle for the hearts of voters, but also a more pragmatic one for the minds of delegates, because each one wants to be the nominee for the bigger battle ahead. And suddenly in the very first contest between them of the year, one candidate pulls ahead with a dramatic upset, casting seer doubt on the viability of the other (who had campaigned with an aura of inevitability).
Hillary Clinton and Barack Obama, competing for the Democratic presidential nomination? Nope. HD-DVD and Blu-ray, competing for next-generation DVD status in your home theater (and more importantly, on your DVD bookshelf).
The big news last week was that Warner Video is ditching HD-DVD; now comes news from the Financial Times that Paramount might also abandon the format and embrace Blu-ray exclusivity:
Paramount is poised to drop its support of HD-DVD following Warner Brothers’ recent backing of Sony’s Blu-ray technology, in a move that could sound the death knell of HD-DVD and bring the home entertainment format war to a definitive end.
Paramount and DreamWorks Animation, which makes the Shrek films, came out in support of HD-DVD last summer, joining General Electric’s Universal Studios as the main backers of the Toshiba format.
However, Paramount, which is owned by Viacom, is understood to have a clause in its contract with the HD-DVD camp that would allow it to switch sides in the event of Warner backing Blu-ray, according to people familiar with the situation.
Paramount is set to have a bumper 2008 with several likely blockbusters, including the latest instalment in the Indiana Jones franchise, slated for release.
This basically leaves HD-DVD without any major must-have titles in its format exclusively, as Blu-Ray already had about 70% of the content even before you take Paramount into account. Already, TechCrunch is declaring the format war over and that HD-DVD has “joined the Deadpool”. To say this is premature is an understatement. To date, combined sales of HD-DVD and Blu-Ray players and discs alike are a drop in the bucket compared to traditional DVD sales. Plus, Universal Studios still is committed to the format and as we have just seen, major studio allegiances can shift over time. The key I think to keeping HD-DVD alive is that the players are cheap, and they do the job as an advanced DVD player to upconvert traditional DVD to HDTV resolution. Take the Playstation 3 out of the equation and standalone HD-DVD players easily outsell Blu-ray; from a consumer perspective it’s the $99-$199 piece of hardware that is easier to justify than the $499-$699 one, especially when that consumer still is feeling the pain of the outlay for the fancy new HDTV (which everyone’s going to feel at some point, given the pending switchover).
I think it’s absurd to count HD-DVD out right now. Certainly the news isn’t great, but neither format is viable yet and it will be years before they even begin to approach a reasonable fraction of the existing DVD market. I’d still buy an HD-DVD today if I had an HDTV to watch it on, mainly because it would serve double duty and ultimately all of this won’t matter because the future is not physical media, it’s video download.