There's a format war going on, in case you've not turned on the TV, surfed the Internet, or stepped into a consumer electronics retailer for the past year and a half. But some news that has emerged from a couple of trade shows this week shows that the "war" is more like a slap-fight between a couple of preadolescent girls: it holds great significance to the parties involved and may be slightly entertaining to watch, but it does very little lasting damage.
Over the last couple of days, the North American HD DVD Promotional Group has sent out press releases trumpeting the format's momentum. HD DVD is going to start advertising on NBC's Sunday Night Football and will soon have 125 new HD DVD titles available. The trade group has also convinced PC manufacturer Acer to join and is highlighting a new Acer laptop (the Aspire 5920) with an HD DVD drive at this week's CEDIA EXPO 2007.
At the same expo, both Sony and Toshiba gave presentations on the strengths of their preferred formats. Sony played up Blu-ray's two-to-one sales lead over HD DVD when it comes to discs sold so far. Sony also says Blu-ray has 55 percent of the next-gen HD player market, compared to 43 percent for HD DVD and 2 percent for hybrid players. But if you take a closer look at the images snapped of Sony's charts by AnandTech, you can see a rather disturbing trend for both Blu-ray and HD DVD.
From their peaks at the end of 2006, both formats have seen a rather precipitous sales decline. According to Sony, Blu-ray sold nearly 70,000 discs per week during the last weeks of 2006. But by mid-May, the last week for which Sony provided data, that had slipped to less than 35,000 per week. HD DVD saw a similar decline, but not as steep, going from around 43,000 discs to a bit more than 20,000. At one point towards the end of April, sales of Blu-ray and HD DVD discs were in a virtual dead heat.
Toshiba blew HD DVD's horn as well. The HD DVD backer pointed out that the format has a 62.7 percent market share… for PC drives. Toshiba also pointed to some market research it conducted that showed consumers were more than twice as likely to buy an HD DVD player than they were a Blu-ray player. One problem: a majority were undecided.
Data source: Toshiba
Across the Atlantic, a panel at the International Broadcast Conference in the Netherlands discussed the battle between HD DVD and Blu-ray. One panelist says that both formats could be in trouble if a clear winner doesn't emerge soon. "The longer the confusion exists for mass market consumers, they will want one format," said Jim Bottoms, cofounder of Understanding & Solutions, according to EETimes. "If the market does not have a one-format solution within 18 months, the consumer will start to turn away."
Other panelists weren't as pessimistic as Bottoms. One estimated that the format war will still be going strong in 2011, when the US will see a 60/40 split between Blu-ray and HD DVD, but with only 40 percent of US households owning an HD disc player of any sort.
Both parties are doing whatever they can to convince consumers to vote with their wallets. Blu-ray scored a couple of victories via agreements with Target and Blockbuster, while HD DVD scored a major coup by convincing Paramount to drop Blu-ray and embrace HD DVD. There has been some serious price-cutting, too, with the first sub-$200 (but 1080i-only) HD DVD soon to launch.
Despite their best efforts, there is still a lot of uncertainty on the part of consumers, and right now, Blu-ray and HD DVD are fighting over a very small piece of the hardware pie. Sales of DVDs and DVD players still dwarf those of both next-gen formats combined: the DVD of Happy Feet sold over 4 million copies during the last week of March, which is almost twice as much as the total next-gen disc format sales since their launch over a year ago. It's a vicious cycle for the next-gen formats: sales won't grow significantly because of consumer uncertainty, that uncertainty won't lessen until there's a clear winner, and a clear winner won't emerge until sales of one format are significant enough to bury the other.