Warner Backs Blu-ray – The War is Over, and The Biggest Loser Is You

Rumored for several months, Warner announced yesterday that they were ceasing support for HD-DVD after May, instead exclusively supporting Blu-ray (Warner was the last studio to support both formats, and has fielded a number of significant releases, such as the Harry Potter franchise, on both).

HD-DVD vs Blu-ray

Their public rationalefor exclusivity was that the "consumer has clearly chosen" one format, given that more Blu-ray discs were sold than HD-DVD, though of course that is unsurprising to anyone at this stage in the competition. The PS3 was the trojan horse that got Blu-ray into 10 million households (basically early-releasing a beta version of a format that is still in flux), while Microsoft blinked and released the XBOX360 with only classic DVD, only adding HD-DVD later as an add-on. The thus far minute high definition sales required little more than an experimental purchase or two by a portion of Playstation 3 owners.

Of course by the historical sales justification, the consumer has chosen to never switch to high-definition content at all, given that DVD sales dwarf both formats combined this early in the game.

Clearly it isn't about the current state of things, it's all about trends, and the trend was that as consumers were finally starting to make the switch, a strong majority had been choosing HD-DVD.

The reason for HD-DVD's leadership among people intentionally choosing a format, rather than accidentally embracing a format through a game unit, is obvious: to paraphrase an old saying – It's the economics, stupid.

HD-DVD players, in all forms (standalone, laptop drives, PC drives, etc), tend to be less expensive. Often much less expensive. Not only are the players themselves less expensive for various technology and licensing reasons, but the consumer gets a secondary win in the form of "combo" discs that support both DVD and HD-DVD on the same disc — an easy, inexpensive feat with HD-DVD, but an expensive, thus far unseen option for Blu-ray due to technical details of the format. With the magic of combo discs you don't have to buy all of your media twice (or upgrade all of your players simultaneously), but instead can play the same disc on your vehicle's DVD player, your laptop's DVD player, that old PC, and yet still enjoy the content in high definition on your entertainment unit.

Having both formats — old and new — on one disc allows the purveyor to give the user this convenience without worrying about cannibalizing their own sales (you can't give the DVD side of the disc to your brother and keep the high-definition side with a combo disc, which is why you won't find both formats on separate discs in a single package).

Technology wise the difference between the two formats is irrelevant for the desired purpose: Blu-ray holds 50 GB on two layers. HD-DVD holds 30-something GB on two layers (contrast that with DVD’s 9GB. The difference is greater still given that the new formats use the vastly superior VC1 codec instead of DVD’s MPEG2, putting much more information in less space) recently finalizing a third layer to boost total storage to 51GB.

Clearly Warner had no economic difficulties supporting both formats. Tto draw a parallel with the web world, it's like supporting multiple browsers on your website — the core content is identical or can be automatically encoded for each client type, and you're left with relatively minor discrepancies to iron out. Or as a better example, to transcode to multiple codecs — if you don't have Windows Media, I'll feed you Quicktime. If anything the HD-DVD discs tended to be less expensive.

So what reason would Warner possibly have to declare an allegiance in this war, given that the public justification is farcical (as are assumptions that they're motivated to hasten an end to this war — if anything the media companies would be motivated to continue the format war as long as possilbe, waiting until you've built a media library and then making you buy it again. People haven't stopped buying DVDs during this battle, aside from the natural slide in sales as people spend moretime online).

Only a few reasons logically stand up to any scrutiny-

  • They were paid off or incentivized to support only one
  • They have been fooled into believing that the DRM of Blu-ray is unbreakable

Ultimately the biggest loser is the consumer. Warner's choice almost certainly means that you will be effectively taxed hundreds of dollars to support the next generation of high definition content.

Expect the already expensive Blu-ray players to increase in price in coming weeks.

Edit: Some of the reports of Warner’s decision are extraordinary bits of misinformation. Take this gem that declares “But in recent months, executives at Time Warner Home Video have seen a dramatic shift in consumer interest towards the Blu-ray format”. What an odd way of reporting the fact that HD-DVD sales took 10% more of the market over the past 12 months, at the expense of Blu-ray. Even better is this entry in the misinformation game which states “Warner was also reportedly offered monetary incentives to continue to support HD DVD but declined.”. What an interesting way of reporting on the fact that Warner was offered incentives by both sides, but apparently the Blu-ray group was willing to offer even more (you don’t have to be Kreskin to understand what it means when Warner refuses to comment about what the payoff was for them to “choose” the Blu-ray side, instead making vague, abstract comments about the future).