Hollywood split on new DVD standard

Hollywood studios are locked in a battle over adopting a standard for high-definition digital video disc technology, in an apparent replay of the 1980s struggle between VHS and Betamax video formats.

    The spat appears to be a repeat of the Betamax battle

    In a decision reminiscent of the conflict that transformed the movie industry more than two decades ago, three major movie studios - Warner Bros, Universal Studios and Paramount Pictures - have taken sides in the fight over next-generation DVD technology, Universal said on Tuesday.

    The trio of studios have endorsed the next-generation HD DVD format that will compete with Blu-ray, the standard being touted by Metro-Goldwyn-Mayer and Sony Pictures, units of Japanese electronics giant Sony Corp.

    The move means that starting in the last quarter of 2005, DVD buyers will be faced with a tough choice between next-generation DVDs with similar features, but two incompatible formats.

    "We have evaluated all of the emerging home entertainment technologies and have selected the one which we feel is the most beneficial to our consumers," Universal Studios Home Entertainment president Craig Kornblau said.

    "We will let the consumer be our guide, but right now we do not plan to release products in Blu-ray. Our priority is HD DVD," he added.

    Difficult choice

    MGM, which Sony agreed to buy in September for $5 billion, is planning to release in Sony's Blue-ray format titles from its 8000-strong film library, which boasts the James Bond and Pink Panther film series.

    But Warner Bros, Universal and Paramount's decision to embrace the HD DVD format, backed by technology from Sony's electronics rival Toshiba, means that consumers will face a difficult choice when it comes to buying DVD players and movies.

    DVD sales are a lucrative part of
    top Hollywood studios' business

    As of last month, Sony and MGM had a combined 19% share of the DVD market, while Paramount, Universal and Warner Bros accounted for 41% of the lucrative pie, industry bible Daily Variety said.

    Other top Tinseltown studios Disney Studios, 20th Century Fox, Dreamworks and Lions Gate have yet to come down on one side or another in the technical struggle that mirrors the video wars that eventually saw the Sony-backed Betamax format die an ignominious death as the world opted for VHS.

    Toshiba said in Tokyo that New Line Cinema, the makers of Lord of the Rings and a unit of Warner Bros owner Time Warner, was also on board with HD DVD, as is HBO, also a Time Warner unit.

    The Toshiba-backed HD DVD players will hit the market late next year, offering improved video quality and enhanced storage capacity, while Sony's Blu-ray will premiere in 2006, Variety said.

    Next generation

    Studios and the electronics makers are set to do battle over billions of dollars in patent and copyright fees and tens of billions of dollars in consumer spending on movies, music and video games.

    Hollywood's top studios see DVD sales as one of the most lucrative parts of their business.

    The next generation of DVD players are expected to debut with a hefty retail price of about $1000 a piece, and will also need to match high-definition television sets in order to take advantage of the boosted picture quality.

    Discs for the new machines will probably cost between $5 and $10 more each.



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