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Audioholics: Reasons Why HD-DVD Formats Have Already Failed

Old 06-14-07, 09:47 PM
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Audioholics: Reasons Why HD-DVD Formats Have Already Failed

10 MORE Reasons Why HD-DVD Formats Have Already Failed
by Clint DeBoer

OK, the the title is a tad-bit deceiving. It's been almost a year now since I wrote my popular yet controversial diatribe on the demise of the competing high definition DVD formats. I wrote the article to illustrate the reasons I believed the formats would fail - even before they fully left the starting gate. The article was accused of many things - the least of which was jumping the gun and not giving the new formats a chance.


Many of the criticisms we received were fair, some were more animated and came largely from early adopters who didn't want to believe their investment wouldn't pay off in the near future. Well, for some clarification, I am all about early adopters - they are the reason CE products ever become affordable in the first place and we salute them. To be an early adopter is to have technology and features in your home most people only dream of, and it's a great place to be.


Lots of comments led me to believe that the premise of the original article was somewhat misunderstood, so let me clarify: I believe that both HD DVD and Blu-ray will fail to become successful, mainstream replacement formats for DVD and will instead remain as niche products while eventually fading into obscurity. If one needs a direct comparison, simply look at the SACD and DVD-Audio formats. I am also not contesting the fact that HD DVD and Blu-ray look considerably better than standard DVD (upconverted or not). I am also defining 'successful' in terms of mass-market adoption - something I do not believe these formats will ever do. Some may say that SACD and DVD-Audio formats are a success - I would respectfully disagree; and I believe HD DVD and Blu-ray are both headed in this general direction despite all the monies being spent on their marketing and adoption as next-generation formats.

It's now a full year past the date of that article and past all of the initial hoopla surrounding the birth of the two competing formats: Blu-ray Disc and HD DVD - so what of my initial assumptions? Is one format clearly dominating over another? Are they quickly on their way to becoming mainstream solutions for high definition content? Have any of the 10 issues I outlined previously turned out to be nothing more than a false prediction or erroneous belief? Well, let's take them one at a time and revisit whether or not I was accurately predicting the future (so far) or whether my critics were correct and it was all a bunch of hyperbole and nonsense...

1. Nobody Likes False Starts

It took HD DVD until CES 2007 (January) to announce a true 1080p player in the US. The announcement came with so much confusion that more than one vendor at the Consumer Electronics Show swore up and down to me that Toshiba's new player still didn't output 1080p (they were wrong). I have had the product in my possession since it debuted. The transport is still extremely, dare I say embarrassingly, slow (how abouot 39 seconds to power up and eject the tray) and the new players fail to pass Blacker-than-Black in certain configurations - a test that determines whether the players can truly recreate the deepest levels of a dark image. Blu-ray players didn't fare much better with Samsung's June 2006 debut having the "hourglass of doom" and featuring its own transport lagging issues. Taking a look back at the past year I'd have to say that a grand total of 6 manufacturers and a half-dozen or so players does not make for a stunning, nor compelling, release. HDMI 1.3 is now available across the board and many titles are now featuring Dolby TrueHD, though so far my luck has been 50/50 with just as many titles having Dolby Digital Plus as the dominant audio format.

2. Format Wars Don't Sell Players

Software is picking up. As of May 1st, 2007 184 HD DVD titles have been released in the US according to Wiki. Blu-ray is faring better and is now up to around 289 titles. The reason both numbers aren't higher is largely due to some holdouts who are not releasing titles in both formats - again, another decision which is ultimately costing the technology in terms of marketshare. In a general sense, however, I don't really see a change here. It seems that every other month one format or the other is making some kind of claim to be outselling the other in terms of software titles - typically to the tune of erroneous reporting and somewhat dubious statistics. Universal players made a big splash at the 2007 CES in Vegas; however when tentative pricing turned out to be about the cost of buying the players separately, not to mention some crippled functionality in the LG unit, excitement on that front waned somewhat. The bottom line is that cross-platform hardware is no substitute for eliminating the format war and I do not foresee expensive hybrid players ending the format war any sooner.

3. HD DVD and Blu-ray are NOT Quantum Leaps in Technology

I was given a first-hand experience of the absolute apathy consumers have towards the new high definition formats when I invited my father-in-law and brother-in-law over for a movie night. We watched Batman Begins on HD DVD, arguably a reference disc. We watched it on an ISF-calibrated 1080p projector (a Mitsubishi HC5000, in for review from ProjectorPeople.com) and the results were amazing. Even though I told them they were watching it in true high definition they never seemed to understand the significance. You see, to the average consumer, DVDs are high definition.


They were impressed by the 100-inch diagonal projector screen, but the fact that it was being displayed at higher-than-DVD resolution didn't seem to affect them one bit. It is my continuing contention that until prices of players drop below $200 and high-definition discs either replace the DVD or become so commonplace as to be recognized by the general public, the switch from DVD to HD-DVD is going to remain something that only significantly impacts enthusiasts who make up a relatively small percentage of the total market.

4. Studios are Conservative, Greedy and Unmotivated

Studios do not seem to be coming together, though a few have jumped ship and are now supporting both formats (a move in the right direction). Currently Blu-ray Disc is exclusively supported by Columbia Pictures and MGM (Sony), Disney, 20th Century Fox and Lionsgate. Both Blu-ray and HD DVD are supported by Paramount Pictures, DreamWorks, Warner Bros. and New Line Cinema. HD DVD is exclusively supported by Universal Studios and The Weinstein Company. In my opinion the studios not supporting both formats at this point are simply shooting themselves in the foot.


Pricing of new HD DVD discs seems to have dropped, though there are plenty of titles still coming in at around $27.95 on Amazon.com (mostly in the hybrid format which makes absolutely no sense due to the added cost.) The hybrid Combo HD DVD/DVD format sounds like a good idea at first glance, however they cost more - which does nothing for those with HD DVD players and very little for owners of standard DVD players. Most HD DVD owners we've talked to would just as soon save the additional $8 and lose the DVD side. Standard DVD owners could care less about paying twice as much for a format they may never use. Blu-ray discs are hovering around $23.95 and both formats seem to have a plethora of titles at around $19.95. With standard DVDs positioned around $15.99-$17.99, the pricing of the HD formats isn't awful, though consumers will not spring for the higher pricing until they fully understand the reasons behind it. The fact that an HD DVD owner cannot purchase all of the movies they want on HD DVD (and likewise for Blu-ray owners) is ludicrous at best and a good sign that those involved still believe that a "winner" will emerge in this format war. To me this is a little like watching two third world countries battle for control over a section of desert.

One other point that is an interesting possibility is that studios tend to be somewhat unreliable towards CE manufacturers - their focus is on the distribution of software. As a result, if a better solutions comes along it is very likely that support for this senseless format war will wane and studios will focus their energies on the next big thing to make them money. If you don't understand this, simply reflect back on how quickly laserdisc died out as a format once DVD came along. Video-on-Demand could do the same for HD-DVD technology.


5. Playstation3 Cannot Save the World

I believe it still cannot. I think it is fairly clear that with both Wii and Xbox 360 are dramatically outpacing the sales of PS3 units across the world, Sony has not capitalized on the PS3 as a means of getting Blu-ray into the homes (and more importantly the home theaters) of consumers. That's not to say that the console isn't selling like hotcakes (3.6 million worldwide), but with less than 50 games shipped and a considerably high retail price it's a very hard sell (Xbox 360 has over 285 games released and Wii, despite its limited titles, has sold nearly 6 million units worldwide.) The PS3 is struggling for marketshare as a gaming platform. With such a struggle, it doesn't seem practical for Sony to position the console, additionally, as a set-top Blu-ray box.

6. Those Who Ignore History…

My original article dealt with the failure of the music industry to adopt a new format to replace the CD and how technology alone is not sufficient motivation for consumers to universally adopt and acclimate to a new format. The failure of the majority of movie studios to even support both formats is a clear indicator that history is repeating itself. We have also seen no more indications that the formats are considering "uniting" under a global high definition solution. As such, it seems that this point continues to be an issue.

7. People Want Technology That's 15 Minutes Ahead of Its Time

Earlier I gave an example of my family not particularly caring about the advances of HD-DVD - they were simply enamored with watching a movie on a 100-inch screen. This, I have personally found, is the case with most non-enthusiast consumers. I believe the conditions still exist which made this an issue in the first place. Consumers simply aren't ready for a new high definition DVD format if it isn't spelled out simply and delivered in a manner that isn't confusing or easily mistaken for existing formats. The only way HD-DVD can be pushed on consumers is, well, to push it on consumers. DVD would have to be replaced. HD DVD and Blu-ray Disc are not being positioned as replacements to DVD, they are simply an option - and one that is being largely ignored by the public despite millions of dollars being spent on competitive marketing. It's too much, too fast, and with too little gain.


8. Enthusiasts Are Getting Tired (and Smarter)

With false starts for both HD DVD and Blu-ray as well as the PS3, this issue is still a state of mind for many consumers - even those who are consistently early adopters. The back and forth claims made by both camps also doesn't do much to convince buyers that either format is positioned to take over and dominate a 'new world order' of high definition media.


9. A Skeptical News Media Doesn't Help

OK, I'll be the first to admit that I'm part of the problem, however Sony is launching a new marketing campaign called "The Format War is Over." With this kind of ridiculous marketing (as if merely saying it makes it true) is there any reason media and editors around the Internet are calling Blu-ray's bluff? This is hardly one-sided as well, with HD DVD making large, sweeping claims each time it can grasp a statistic that shows in its favor. Both camps are out to lunch and cannot see that all they have succeeded in doing is forming two elitist camps that cause consumer confusion and a general sense of apathy that we all have to go through such a debacle again - after so many past lessons have taught us better.


10. Broadband and IPTV to Compete?


It seems that every week we hear something new about cable and satellite TVs plans to expand their ability to deliver HD content. Combined with technology like Verizon's Fios service it seems only a matter of time until video-on-demand takes the role for primary delivery medium of high definition content.

While many have dissected this original article and attempted to say that the format war will someday end and a winner declared, I respectfully disagree. I believe all aspects of my initial assessment continue to hold true - one year later - and at best high definition DVD (at least as far as Blu-ray and HD DVD are concerned) is headed for a niche market of AV enthusiasts. This seems destined to occur regardless if one format eventually disappears or not.


That's still my story and I'm (still) sticking to it.


by Clint DeBoer


A good read, I thought. Though some here at DVDTalk may get a bit queasy given some of Mr. DeBoer’s word choices (such as “crippled”).
Old 06-14-07, 09:55 PM
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I think that he makes very good points.

I have both a PS3 and a D2, and I can tell the difference. I am not sure my wife can.
Old 06-14-07, 11:25 PM
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It's a good read, and I agree with it, but I hate that he titles it "Why HD-DVD Formats Have Already Failed" when he's not just talking about HD-DVD, but both HD media formats together (yes, including Blu-ray).

It just makes it sound like he's another HD-DVD basher when in fact he wrote a fair piece.
Old 06-14-07, 11:36 PM
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Originally Posted by jrutz
It's a good read, and I agree with it, but I hate that he titles it "Why HD-DVD Formats Have Already Failed" when he's not just talking about HD-DVD, but both HD media formats together (yes, including Blu-ray).

It just makes it sound like he's another HD-DVD basher when in fact he wrote a fair piece.
He's just incorrectly referring to both formats as "high definition DVDs." People in the media make that mistake all the time.

He makes some good points (although I disagree about downloads taking over any time soon, and he seems to forget that DVD had some of the same issues when it launched), but I really don't care. I can't help it if other people don't understand and appreciate the difference, or don't want to buy into it. If it remains a niche, so be it.
Old 06-15-07, 07:37 AM
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Look at it this way: Aside from those here, how many people do you know that owned a laserdisc player? That format was far from a failure. Just because something isn't mainstream does not mean it is not successful.
Old 06-15-07, 08:40 AM
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I basically agree with what was said. I don't expect either of the HD formats to really catch on with the mainstream. And that's okay. I will pay more for HD content, but the prices aren't horrible like Laserdisc was. And it is easier to find titles. And eventually people will have to replace their old DVD players, in which case they'll have a new HD-DVD or Blu Ray player. But it will take a long time. At least that's how I see it.
Old 06-15-07, 08:49 AM
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Originally Posted by Qui Gon Jim
Just because something isn't mainstream does not mean it is not successful.
Right. My family bought our first Laserdisc player in 1984, and it was another ten years until I met someone else with one. Got plenty of use out of it regardless, and the fact that no one else I knew owned a Laserdisc player didn't make my movies look any worse.

I'd be thrilled if one or both of these formats settled into a Laserdisc sized niche. Just keep a steady flow of titles coming at not-terribly-outrageous prices and I'll be happy.
Old 06-15-07, 08:58 AM
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Just because something isn't mainstream does not mean it is not successful.
What you have to understand when reading this article is that "mainstream" or mass-adoption is exactly how the author defines successful. If you don't understand that you're going to read this article and become frustrated. If you do understand that and don't agree, then that's fine. However, I personally feel that the odds are heavily against mass-adoption for these formats. In fact, I think there is virtually no chance of it happening with two formats, and only a snow ball's chance with one.

Here's something else to consider... Given the amount of side-choosing, marketing, spin, etc. that the studios have done with HD optical media formats, do you honestly think they're hoping it is anything less than how success is defined in this article? If they have defined success as establishing control of a niche market for royalty rights, then they're crazier than we are for spending our days bickering about them.
Old 06-15-07, 09:22 AM
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Originally Posted by Qui Gon Jim
Look at it this way: Aside from those here, how many people do you know that owned a laserdisc player? That format was far from a failure. Just because something isn't mainstream does not mean it is not successful.
Laserdisc was a failure in the US. It had relatively zero mass appeal.
Old 06-15-07, 09:27 AM
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I think it's possible than in a couple of years, all we'll have is HD players to buy. They are all backwards compatible and they'll be cheap enough to purchase from the J6P crowds. It's kind of like HDTVs. That's basically the only choice now. It can be the same for players.

What else can manufacturers to do dvd players to improve them? Do they even make money anymore since the mainstream audience buys the cheaper units?
Old 06-15-07, 09:32 AM
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Originally Posted by DVD Josh
Laserdisc was a failure in the US. It had relatively zero mass appeal.
I'd argue that one statement has nothing to do with the other.

There were tens of thousands of Laserdisc releases over a couple of decades. A product can be successful with a rabidly devoted niche even if it's not widely adopted. I wouldn't called Laserdisc a runaway success, but I can't consider something that was that robust for that long a failure.
Old 06-15-07, 09:38 AM
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What's the HD market share? 1%? 2%?

I don't see it getting above 10% until at least Holiday 2008, maybe even more. The US's largest retailer still hasn't made a real push to sell this format, not in every store at least.

I think we'll see it slowly pick up once hardware prices for either format are consistently in the $200-$400 range (we're getting there), there's 400+ movies to choose from on either format, AND software prices more closely mirror DVDs ($10-$25, not $20-$35).
Old 06-15-07, 09:41 AM
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Originally Posted by Adam Tyner
I'd argue that one statement has nothing to do with the other.

There were tens of thousands of Laserdisc releases over a couple of decades. A product can be successful with a rabidly devoted niche even if it's not widely adopted. I wouldn't called Laserdisc a runaway success, but I can't consider something that was that robust for that long a failure.
Ok, I will modify. Laserdisc had virtual zero mass appeal in the US. However Adam, I think we can agree that in the US marketplace, "success" and "mass appeal" are virtually synonymous.
Old 06-15-07, 09:56 AM
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Originally Posted by Mr. Cinema
I think it's possible than in a couple of years, all we'll have is HD players to buy. They are all backwards compatible and they'll be cheap enough to purchase from the J6P crowds. It's kind of like HDTVs. That's basically the only choice now. It can be the same for players.

This is true. When Blu Ray and/or HD-DVD players are cheap enough that they're the same price as DVD players, people will have to buy them. Now whether they ever use the HD benefits is another story. But it will make the changeover inevitable. The greater question is whether DVDs will ever stop being produced. If studios continue to sell DVDs for cheaper than HD-DVDs or Blu Rays, even when sufficient people own HD players, then the format will still be a niche, IMO.
Old 06-15-07, 10:16 AM
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Agree with the article (except for #10, it will still be some time before those things can offer serious competition). I've always believed that the HD formats (or format, if one ends up defeating the other) will be a niche product. But if that niche ends up being comparable to what LD was, and we get a steady flow of releases, I'll be happy to have HD discs available (just like the average person will continue to be happy with standard DVDs).
Old 06-15-07, 10:51 AM
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Originally Posted by Jericho
This is true. When Blu Ray and/or HD-DVD players are cheap enough that they're the same price as DVD players, people will have to buy them. Now whether they ever use the HD benefits is another story. But it will make the changeover inevitable. The greater question is whether DVDs will ever stop being produced. If studios continue to sell DVDs for cheaper than HD-DVDs or Blu Rays, even when sufficient people own HD players, then the format will still be a niche, IMO.
Yeah, I see it happening something like that. And when the difference in the cost to produce HD discs and the cost to produce DVD become negligible, then the studios will sell both at similar/same price ... or the studio may choose to NOT release the DVD version for some titles if most of the homes have HD players by then.
Old 06-15-07, 11:13 AM
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Originally Posted by namja
Yeah, I see it happening something like that. And when the difference in the cost to produce HD discs and the cost to produce DVD become negligible, then the studios will sell both at similar/same price ... or the studio may choose to NOT release the DVD version for some titles if most of the homes have HD players by then.
Or only release Combos . . .
Old 06-15-07, 11:44 AM
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Originally Posted by DVD Josh
Ok, I will modify. Laserdisc had virtual zero mass appeal in the US. However Adam, I think we can agree that in the US marketplace, "success" and "mass appeal" are virtually synonymous.
No, "success" is defined as the company making enough profit to justify continuing to produce the product. The laserdisc format lasted for 20 years. It wouldn't have lasted that long if the companies involved weren't making enough profit to consider it successful.

Laserdisc was a success for the expectations set out for it. It just wasn't a mass market item.
Old 06-15-07, 01:23 PM
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Originally Posted by Qui Gon Jim
Look at it this way: Aside from those here, how many people do you know that owned a laserdisc player? That format was far from a failure. Just because something isn't mainstream does not mean it is not successful.
Exactly. It was a niche success, and honestly I don't think HD-DVD or Blu Ray will do much more than that.

Both (or one) will stick around and sell to enthusiasts, while DVDs remain the mainstream movie format for the foreseeable future. Personally I think they'll hold on just like CDs have.
Old 06-15-07, 04:33 PM
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I don't have a problem with the formats remaining a "niche" product. I just want studios to support both so we can enjoy ALL movies on either format. Unfortunately, that will probably never happen.
Old 06-15-07, 04:55 PM
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3. HD DVD and Blu-ray are NOT Quantum Leaps in Technology

That is absolutely true. Most don't have a tv big enough to take advantage, and DVDs still look pretty dang good, especially if you have a good upconverting player. So spend you money on HD-DVD/BR or on the new ipod, cell phone, computer, etc.?
Old 06-15-07, 05:12 PM
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If/when studios can produce hd-dvds and BD discs for the same price that they can produce s-dvds, as well as hardware, then they will stop making s-dvds and hardware. If not, then it will be a niche. This article doesnt bring any new points to the table. Its as simple as cost. Eventually those $50.00 cheapo dvd players will break down, and if people can replace it with an HD or BD player for the same price, then they will, regardless if there is an upgrade or not.
Old 06-15-07, 05:21 PM
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Originally Posted by FantasticVSDoom
If/when studios can produce hd-dvds and BD discs for the same price that they can produce s-dvds, as well as hardware, then they will stop making s-dvds and hardware.
That's not true, people actually have to buy the players and discs and stop buying regular DVDs.

If there are still vastly more people with DVD players and buying DVDs than there are those with the HD formats buying those discs you think the studios will stop making SD-DVDs (and thus vastly reduce profits) just because they can make the HD discs for the same cost? What are they going to do, advance HD at expense of their bottom line?

Hell now. Production costs are only one part of the picture. Mass market acceptance is the key, at least in terms of SD-DVDs ever going the way of the dodo.

The break down and replace idea doesn't really fly either, as the formats would likely have failed before enough people bought new HD players to replace SD players to swing the market share. Hell, I have CD players pushing 20 years that still work fine. A DVD player can last a long time, especially among casual viewers.
Old 06-15-07, 05:28 PM
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Originally Posted by sbelli
I don't have a problem with the formats remaining a "niche" product. I just want studios to support both so we can enjoy ALL movies on either format. Unfortunately, that will probably never happen.
I totally agree with this. I don't mind being a part of a niche market. I just wish the studios could get together and pick a format that everyone could be happy with. And at this point, hopefully it's a format that can support both HD-DVD and Blu-ray. But I know that will never happen ...
Old 06-15-07, 05:54 PM
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Originally Posted by Josh H
That's not true, people actually have to buy the players and discs and stop buying regular DVDs.

If there are still vastly more people with DVD players and buying DVDs than there are those with the HD formats buying those discs you think the studios will stop making SD-DVDs (and thus vastly reduce profits) just because they can make the HD discs for the same cost? What are they going to do, advance HD at expense of their bottom line?
HD DVD players are compatible with standard DVDs. So replacing the player with a new HD model isn't going to harm anyone with a significant DVD collection.

As for software, there are Combo discs that will work on either type of player.

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