Toshiba Concedes Defeat in Format War

The second major format war is over, and this time Sony has actually appeared to come out on top! Yesterday, Toshiba announced it was throwing in the towel and officially discontinuing its HD DVD format, former rival to Sony's Blu-ray. (Source: yahoo.com)

The announcement opens the way for Blu-ray to become the industry standard for the next generation of home video. The format war created a lot of hesitancy among customers to invest in second generation players while the two-tiered system existed. There are approximately 30 million high definition television sets in homes across the United States, but only 1.5 million of those also own a second generation DVD player.

The death knell for HD DVD began in early January when Warner Bros. announced it would stop releasing movies in the format. Following this announcement, major retailers such as Netflix, Best Buy, and Wal Mart joined the exodus, and the final nail in the coffin for Toshiba came earlier this week, when Universal Home Studios, the last of the major studios to support HD DVD, announced it would also cease production.

During the press conference where Toshiba conceded defeat, the company's Chief Executive Atsutoshi Nishida said, "This was a very difficult decision to make...but when we thought about the trouble we would cause to consumers and our partners, we decided it was not right for us to keep going with such a small presence." (Source: nytimes.com)

Now that Blu-ray has become the industry standard, attention will now turn to convincing customers to change from regular DVDs to the new High Definition format. However, some experts believe a major switch will take at least three to five years before Blu-ray begins to overtake regular DVDs in sales. (Source: com.au) Even then it might be a tough sell, as it wasn't that long ago that the VHS tapes were phased out of video rental outlets.

Not surprisingly, Microsoft is not moving very quickly to support Blu-ray. PC World is reporting that the software giant declined to comment on whether it would discontinue its external HD DVD drive for the Xbox 360, as well as demurring about integrating rival Sony's Playstation 3 technology into its own gaming console. Most likely, this reluctance is temporary and Microsoft, an early HD DVD advocate, just needs a little time to get used to living in Sony's high definition world.