HD DVD and Blu-ray: Toward an Endgame

In a recent survey of HDTV owners by NPD Group, a full 73% were satisfied with the picture quality provided by upconverted DVDs for them to become too interested in a high-definition disc player of either format. Other figures are equally shocking, suggesting that the high-def format war may already be over. BetaNews spoke at length with the NPD report's lead analyst, Ross Rubin.

If there were just one universally embraced format for high-definition video discs, it would most likely have been introduced just over two years ago, probably at the $1,200 price point. By the spring of 2006, the budget-priced versions would have appeared at around $699.

The video game console manufacturers would have been racing to be the first, and the best, to bring the format to market. Their competitive breakthroughs might have driven the stand-alone console price to $399. And today, we would have probably been trumpeting the entry of low-price manufacturers from China, ready to flood world markets with $150 models.

This is how it might have been. Unfortunately, groups of intellectual property rights holders with dueling portfolios have maintained the present state of stalemate between two high-def formats, Blu-ray and HD DVD, whose physical and technical distinctions from one another are perhaps notable, though often trivial.

We are well beyond the point in time where we should have been talking about the new, single high-def format eclipsing that critical juncture that marketers and analysts search for, that peak period when titles for high-def exceed those for first-generation DVD. Instead, we're still treating the owners of the first- and second-generation high-def consoles as early adopters, and every other customer as a potential market.

Among those early adopters, infighting remains fierce as they strive desperately to discover whatever new justification may remain, like shrinking mud puddles in a hot desert, for the investments they've already made. Their collective dissatisfaction is the clearest sign that the true potential for both formats has never been realized.

It is a sad end for a hopeful technology, perhaps the last generation of discs for distributing movies. However, it looks to be a long and dreary end, as the champions of both formats remain unwilling to concede any ground.

By any analyst's 2005 standards, neither HD DVD nor Blu-ray is the victor in this format war. Sure, Blu-ray may have sold the most movies for one stretch of months, and HD DVD may have one over one more studio that was on the fence. But like the incessant battle between "great taste" and "less filling," you start to get the feeling nobody ever devised this battle in such a way that it would end.

No one knows this feeling better than NPD's director of industry analysis for consumer electronics, Ross Rubin. According to his team's report released last week, 52% of consumers polled who already own HDTVs - just slightly more than half - knew high-definition players even existed. Among those, 11% had any intention of buying one in either or both formats before the holidays, while 62% said they're waiting for prices to fall.

But the incredible figure is this: A full 73% of HDTV owners claimed they're happy with the non-high-def DVD player they already have.

NPD calls it, "The High-Definition Content Conundrum:" the seemingly impossible outcome of all the press being given to both sides in the format war leading to a lack of consumer's knowledge about them. Only 29% of all poll respondents, including non-HDTV owners, said they had ever heard of HD DVD; a mere 20% had heard of Blu-ray.

It's the kind of data that would convince manufacturers not to try to build a dual-format player - the kind of device which many, including Rubin, have thought could bring the format war to an amicable conclusion.

Next: What if dual-format can't reach the magical price point?