High definition optical disc format war

Format war

A format war describes competition between mutually incompatible proprietary formats that compete for the same market, typically for data storage devices and recording formats for electronic media. It is often characterized by political and financial influence on content publishers by the...

took place between the Blu-ray Disc

Blu-ray Disc

Blu-ray Disc is an optical disc storage medium designed to supersede the DVD format. The plastic disc is 120 mm in diameter and 1.2 mm thick, the same size as DVDs and CDs. Blu-ray Discs contain 25 GB per layer, with dual layer discs being the norm for feature-length video discs...

and HD DVD

HD DVD

HD DVD is a discontinued high-density optical disc format for storing data and high-definition video.Supported principally by Toshiba, HD DVD was envisioned to be the successor to the standard DVD format...

optical disc

Optical disc

In computing and optical disc recording technologies, an optical disc is a flat, usually circular disc which encodes binary data in the form of pits and lands on a special material on one of its flat surfaces...

standards for storing high definition

High-definition video

High-definition video or HD video refers to any video system of higher resolution than standard-definition video, and most commonly involves display resolutions of 1,280×720 pixels or 1,920×1,080 pixels...

video and audio.

These standards emerged between 2000 and 2002 and attracted both the mutual and exclusive support of major consumer electronics

Consumer electronics

Consumer electronics are electronic equipment intended for everyday use, most often in entertainment, communications and office productivity. Radio broadcasting in the early 20th century brought the first major consumer product, the broadcast receiver...

manufacturers, personal computer

Personal computer

A personal computer is any general-purpose computer whose size, capabilities, and original sales price make it useful for individuals, and which is intended to be operated directly by an end-user with no intervening computer operator...

manufacturers, television and movie producers and distributors, and software developers.

Blu-ray and HD DVD players became commercially available starting in 2006. In early 2008, a tipping point

Tipping point

In sociology, a tipping point is the event of a previously rare phenomenon becoming rapidly and dramatically more common. The phrase was coined in its sociological use by Morton Grodzins, by analogy with the fact in physics that adding a small amount of weight to a balanced object can cause it to...

was passed when several studios and distributors shifted to Blu-ray disc. On February 19, 2008, Toshiba

Toshiba

is a multinational electronics and electrical equipment corporation headquartered in Tokyo, Japan. It is a diversified manufacturer and marketer of electrical products, spanning information & communications equipment and systems, Internet-based solutions and services, electronic components and...

officially announced that it would stop the development of the HD DVD players

DVD player

A DVD player is a device that plays discs produced under both the DVD-Video and DVD-Audio technical standards, two different and incompatible standards. These devices were invented in 1997 and continue to thrive...

, conceding the format war to the Blu-ray Disc format.

Background

The Blu-ray/HD DVD conflict resembled the earlier videotape format war

Videotape format war

The videotape format war was a period of intense competition or "format war" of incompatible models of consumer-level analog video videocassette and video cassette recorders in the late 1970s and the 1980s.- Overview :...

between VHS

VHS

The Video Home System is a consumer-level analog recording videocassette standard developed by Victor Company of Japan ....

and BetaMax

Betamax

Betamax was a consumer-level analog videocassette magnetic tape recording format developed by Sony, released on May 10, 1975. The cassettes contain -wide videotape in a design similar to the earlier, professional wide, U-matic format...

, partly because of Sony

Sony

, commonly referred to as Sony, is a Japanese multinational conglomerate corporation headquartered in Minato, Tokyo, Japan and the world's fifth largest media conglomerate measured by revenues....

's strong involvement in both episodes. These format wars have often proved destructive to both camps because consumers, afraid of committing to a losing standard, will refrain from purchasing either. Format wars have been avoided in notable cases such as the DVD Forum

DVD Forum

The DVD Forum is an international organization composed of hardware, software, media and content companies that use and develop the DVD and formerly HD DVD formats...

for the unified DVD

DVD

A DVD is an optical disc storage media format, invented and developed by Philips, Sony, Toshiba, and Panasonic in 1995. DVDs offer higher storage capacity than Compact Discs while having the same dimensions....

standard, the Grand Alliance

Grand Alliance (HDTV)

The Grand Alliance was a consortium created in 1993 at the behest of the Federal Communications Commission to develop the American digital television and HDTV specification, with the aim of pooling the best work from different companies...

for the HDTV standard, and the Wi-Fi Alliance for wireless networking

Wi-Fi

Wi-Fi or Wifi, is a mechanism for wirelessly connecting electronic devices. A device enabled with Wi-Fi, such as a personal computer, video game console, smartphone, or digital audio player, can connect to the Internet via a wireless network access point. An access point has a range of about 20...

standards.

The emergence of high definition players followed the entry of HDTV televisions into the mainstream market in the mid-2000s. Consumer-grade high definition players required an inexpensive storage medium capable of holding the larger amount of data needed for HD video. The breakthrough came with Shuji Nakamura

Shuji Nakamura

is a professor at the Materials Department of the College of Engineering, University of California, Santa Barbara .- Career :Nakamura graduated from the University of Tokushima in 1977 with a degree in electronic engineering, and obtained a master's degree in the same subject two years later, after...

's invention of the blue laser diode

Blue laser

A so-called blue laser is a laser that emits electromagnetic radiation at a wavelength of between 360 and 480 nanometres, which the human eye sees as blue or violet. Diode lasers which emit light at 445 nm are becoming popular as handheld lasers. Light of a shorter wavelength than 400 nm is...

, whose shorter wavelength opened the door to higher density optical media following a six year patent dispute

Patent infringement

Patent infringement is the commission of a prohibited act with respect to a patented invention without permission from the patent holder. Permission may typically be granted in the form of a license. The definition of patent infringement may vary by jurisdiction, but it typically includes using or...

.

Sony started two projects applying the new diodes: Ultra Density Optical

Ultra Density Optical

Ultra Density Optical is an optical disc format designed for high-density storage of high-definition video and data.- Overview :...

and, with Pioneer

Pioneer Corporation

is a multinational corporation that specializes in digital entertainment products, based in Kawasaki, Kanagawa, Japan. The company was founded in 1938 in Tokyo as a radio and speaker repair shop...

, DVR Blue. The first DVR Blue prototypes were unveiled at the CEATEC

CEATEC

Combined Exhibition of Advanced Technologies is an annual trade show in Japan. It is regarded as the Japanese equivalent of Consumer Electronics Show...

exhibition in October 2000. In February 2002, the project was officially announced as Blu-ray

Blu-ray Disc

, and the Blu-ray Disc Association

Blu-ray Disc Association

The Blu-ray Disc Association is the industry consortium that develops and licenses Blu-ray Disc technology and is responsible for establishing format standards and promoting business opportunities for Blu-ray Disc...

was founded by a consortium of nine electronics companies.

The DVD Forum, chaired by Toshiba

Toshiba

, was deeply split over whether to go with the more expensive blue lasers, whose discs initially required a protective caddy to avoid mis-handling, making the medium more expensive and physically different from DVDs. In March 2002, the forum voted to approve a proposal endorsed by Warner Bros.

Warner Bros.

Warner Bros. Entertainment, Inc., also known as Warner Bros. Pictures or simply Warner Bros. , is an American producer of film and television entertainment.One of the major film studios, it is a subsidiary of Time Warner, with its headquarters in Burbank,...

and other motion picture studios that involved compressing HD content onto dual-layer DVD-9 discs. In spite of this decision, the DVD Forum's Steering Committee announced in April that it was pursuing its own blue-laser high-definition solution. In August, Toshiba and NEC announced their competing standard Advanced Optical Disc, which was finally adopted by the DVD Forum and renamed "HD DVD" the following year after being voted down twice by Blu-ray Disc Association members, prompting the U.S. Department of Justice to make preliminary investigations. Three new members had to be invited and the voting rules changed before the initiative finally passed.

The competing standards had significant differences that made each incompatible with the other.

Attempts to avoid a format war

In an attempt to avoid a costly format war, the Blu-ray Disc Association and DVD Forum started to negotiate a compromise in early 2005. One of the issues was that Blu-ray's supporters wanted to use a Java-based platform for interactivity (BD-J

BD-J

BD-J, or Blu-ray Disc Java, is a specification supporting Java ME Xlets for advanced content on Blu-ray Disc and the Packaged Media profile of Globally Executable MHP .BD-J allows bonus content on Blu-ray Disc titles to be far more sophisticated than bonus content provided by standard DVD,...

), while the DVD Forum was promoting Microsoft's "iHD" (which became HDi). A much larger issue, though, was the physical formats of the discs themselves; the Blu-ray Disc Association's member companies did not want to risk losing billions of dollars in royalties as they had done with standard DVD. An agreement seemed close, but negotiations proceeded slowly.

At the end of June 2005, Sun Microsystems

Sun Microsystems

Sun Microsystems, Inc. was a company that sold :computers, computer components, :computer software, and :information technology services. Sun was founded on February 24, 1982...

, the developer of Java

Java (programming language)

Java is a programming language originally developed by James Gosling at Sun Microsystems and released in 1995 as a core component of Sun Microsystems' Java platform. The language derives much of its syntax from C and C++ but has a simpler object model and fewer low-level facilities...

, announced that the Blu-ray Association had chosen the Java-based BD-J interactivity layer instead of Microsoft's HDi. This was based on a BDA board vote favouring BD-J 10 to 4, despite a technical committee previously favoring HDi by a vote of 7 to 5. At the same time, Microsoft and Toshiba jointly announced that they would cooperate in developing high-definition DVD players. In a top-level meeting in July, Microsoft's Bill Gates argued that the Blu-ray standard had to change to "work more smoothly with personal computers". The Blu-ray Disc's representatives defended the technology.

On August 22, 2005, the Blu-ray Disc Association and DVD Forum announced that the negotiations to unify their standards had failed. Rumors surfaced that talks had stalled; publicly, the same reasons of physical format incompatibility were cited. In the end of September, Microsoft and Intel jointly announced their support for HD DVD.

Hewlett Packard (HP) proposed an ultimatum for the Blu-ray Disc Association: adopt Microsoft's proprietary

Vendor lock-in

In economics, vendor lock-in, also known as proprietary lock-in or customer lock-in, makes a customer dependent on a vendor for products and services, unable to use another vendor without substantial switching costs...

HDi (instead of the Java based system) and a mandatory managed copy feature, or HP would support HD DVD instead. In a research report, Gartner analysts Van Baker, Laura Behrens and Mike McGuire wrote that if HP's proposal were accepted, Blu-ray would become the winner of the format war. Though the Blu-ray Disc group did add mandatory managed copy to Blu-ray, they did not add HDi.

HD DVD players and movies were released in the United States on April 18, 2006, The first Blu-ray Disc titles were released on June 20, 2006 and the first movies using dual layer Blu-ray discs (50 GB) were introduced in October 2006.

Alliances

The Blu-ray Disc Foundation was formed by Hitachi

Hitachi, Ltd.

is a Japanese multinational conglomerate headquartered in Marunouchi 1-chome, Chiyoda, Tokyo, Japan. The company is the parent of the Hitachi Group as part of the larger DKB Group companies...

, LG

LG Electronics

LG Electronics is a global electronics and telecommunications company headquartered in Yeouido, Seoul, South Korea. The company operates its business through five divisions: mobile communications, home entertainment, home appliance, air conditioning and business solution...

, Panasonic

Panasonic

Panasonic is an international brand name for Japanese electric products manufacturer Panasonic Corporation, which was formerly known as Matsushita Electric Industrial Co., Ltd...

, Pioneer

Pioneer Corporation

is a multinational corporation that specializes in digital entertainment products, based in Kawasaki, Kanagawa, Japan. The company was founded in 1938 in Tokyo as a radio and speaker repair shop...

, Philips

Philips

Koninklijke Philips Electronics N.V. , more commonly known as Philips, is a multinational Dutch electronics company....

, Samsung

Samsung

The Samsung Group is a South Korean multinational conglomerate corporation headquartered in Samsung Town, Seoul, South Korea...

, Sharp

Sharp Corporation

is a Japanese multinational corporation that designs and manufactures electronic products. Headquartered in Abeno-ku, Osaka, Japan, Sharp employs more than 55,580 people worldwide as of June 2011. The company was founded in September 1912 and takes its name from one of its founder's first...

, Sony

Sony

, commonly referred to as Sony, is a Japanese multinational conglomerate corporation headquartered in Minato, Tokyo, Japan and the world's fifth largest media conglomerate measured by revenues....

, and Thomson

Thomson SA

Technicolor SA , formerly Thomson SA and Thomson Multimedia, is a French international provider of solutions for the creation, management, post-production, delivery and access of video, for the Communication, Media and Entertainment industries. Technicolor’s headquarters are located in Issy les...

on May 20, 2002. Other early supporters included Dell

Dell

Dell, Inc. is an American multinational information technology corporation based in 1 Dell Way, Round Rock, Texas, United States, that develops, sells and supports computers and related products and services. Bearing the name of its founder, Michael Dell, the company is one of the largest...

, HP, Mitsubishi

Mitsubishi

The Mitsubishi Group , Mitsubishi Group of Companies, or Mitsubishi Companies is a Japanese multinational conglomerate company that consists of a range of autonomous businesses which share the Mitsubishi brand, trademark and legacy...

and TDK

TDK

, formerly , is a Japanese company which manufactures electronic materials, electronic components, and recording and data-storage media, and markets them globally. Their motto is "Contribute to culture and industry through creativity"...

. The Blu-ray Disc Association

Blu-ray Disc Association

was inaugurated on October 4, 2004 by 14 companies of Board of Directors which added 20th Century Fox

20th Century Fox

Twentieth Century Fox Film Corporation — also known as 20th Century Fox, or simply 20th or Fox — is one of the six major American film studios...

to the 13 above-mentioned companies, Contributors of 22 companies, General members of 37 companies, and a total of 73 companies.

Acer

Acer (company)

Acer Incorporated is a multinational information technology and electronics corporation headquartered in Xizhi, New Taipei City, Taiwan. Acer's products include desktop and laptop PCs, tablet computers, servers, storage devices, displays, smartphones and peripherals...

, Alpine

Alpine Electronics

is traditionally known as an aftermarket car audio and navigation systems manufacturer, famed for their high quality, premium in-car audio units commonly known as headunits. It is a subsidiary of Alps Electric Co. and its registered head office is in Tokyo, Japan. However its main offices, or the...

, Asus

ASUS

ASUSTeK Computer Incorporated is a multinational computer technology and consumer electronics product manufacturer headquartered in Taipei, Taiwan. Its product range includes motherboards, desktops, laptops, monitors, tablet PCs, servers and mobile phones...

, HP

Hewlett-Packard

Hewlett-Packard Company or HP is an American multinational information technology corporation headquartered in Palo Alto, California, USA that provides products, technologies, softwares, solutions and services to consumers, small- and medium-sized businesses and large enterprises, including...

, Hitachi Maxell, Kenwood

Kenwood Electronics

is a Japanese manufacturer of amateur radio as well as Hi-Fidelity and portable audio equipment.-History:The company first started in 1946 as the Kasuga Radio Co. Ltd. In Komagane City, Nagano Prefecture, Japan. In 1960 the firm was renamed "Trio Corporation"...

, Lanix

Lanix

Lanix is a Mexican electronics company based in Hermosillo, Sonora, Mexico. It is Mexico's largest domestically owned electronics company, and sells a wide array of both consumer and professional electronics...

, LG

LG Electronics

, Lite-On

Lite-On

Lite-On is a conglomerate of individual companies that primarily manufacture consumer electronics, including LEDs, semiconductors, computer chassis, monitors, motherboards, DVD & CD devices, and other electronic components...

, Meridian

Meridian Audio, Ltd.

Boothroyd Stuart Meridian is a British manufacturer of high-performance, high-fidelity audio and video components and systems. Founded in 1977 by Bob Stuart and Allen Boothroyd, its products have proved popular among music and movie enthusiasts, and more recently in the lifestyle technology and...

, Onkyo

Onkyo

is a Japanese consumer electronics manufacturer, specializing in home cinema and audio equipment including receivers and surround sound speakers. The word Onkyo translates as "sound harmony".The company started under the name of Osaka Denki Onkyo K.K in 1946...

and Samsung

Samsung Group

The Samsung Group is a South Korean multinational conglomerate corporation headquartered in Samsung Town, Seoul, South Korea...

, provided non-exclusive support.

Toshiba

Toshiba

, NEC, Sanyo

Sanyo

is a major electronics company and member of the Fortune 500 whose headquarters is located in Moriguchi, Osaka prefecture, Japan. Sanyo targets the middle of the market and has over 230 Subsidiaries and Affiliates....

, Memory-Tech Corporation started HD DVD Promotion Group on September 27, 2004. It also included Microsoft

Microsoft

Microsoft Corporation is an American public multinational corporation headquartered in Redmond, Washington, USA that develops, manufactures, licenses, and supports a wide range of products and services predominantly related to computing through its various product divisions...

, RCA

RCA

RCA Corporation, founded as the Radio Corporation of America, was an American electronics company in existence from 1919 to 1986. The RCA trademark is currently owned by the French conglomerate Technicolor SA through RCA Trademark Management S.A., a company owned by Technicolor...

, Intel, Venturer Electronics. In Europe, HD DVD was supported either exclusively or non-exclusively by Medusa Home Entertainment, Studio Canal, Universum Films, Kinowelt Home Entertainment, DVD International, Opus Arte, MK2, Momentum Pictures, Twister Home Video, among others.

During the height of the format war, some studios supported both formats, including Paramount Pictures

Paramount Pictures

Paramount Pictures Corporation is an American film production and distribution company, located at 5555 Melrose Avenue in Hollywood. Founded in 1912 and currently owned by media conglomerate Viacom, it is America's oldest existing film studio; it is also the last major film studio still...

(including subsidiaries Nickelodeon Movies

Nickelodeon Movies

Nickelodeon Movies is the motion picture production arm of children's cable channel Nickelodeon, originally launched in 1995. Its first film was Harriet the Spy. It has produced films based on Nickelodeon programs, as well as other adaptations and original projects...

, MTV Films

MTV Films

MTV Films is the motion picture production arm of cable channel MTV. Founded in 1996, it has produced films based on MTV programs such as Beavis and Butt-head Do America and Jackass: The Movie, as well as other adaptations and original projects. Its films are released by fellow Viacom division...

, DreamWorks Pictures and DreamWorks Animation

DreamWorks Animation

DreamWorks Animation SKG, Inc. is an American animation studio based in Glendale, California that creates animated feature films, television program and online virtual worlds...

), BBC

BBC

The British Broadcasting Corporation is a British public service broadcaster. Its headquarters is at Broadcasting House in the City of Westminster, London. It is the largest broadcaster in the world, with about 23,000 staff...

, First Look Studios

First Look Studios

First Look Studios was an independent American film studio that specialized in home video releases of films and TV series. It purchased the Blockbuster subsidiary, DEJ Productions, in 2005...

, Image Entertainment

Image Entertainment

Image Entertainment, Inc. is an independent licensee, producer and distributor of home entertainment programming and film & television productions in North America, with approximately 3,000 exclusive DVD titles and approximately 250 exclusive CD titles in domestic release, and approximately 450...

(including the Discovery Channel

Discovery Channel

Discovery Channel is an American satellite and cable specialty channel , founded by John Hendricks and distributed by Discovery Communications. It is a publicly traded company run by CEO David Zaslav...

), Magnolia Pictures

Magnolia Pictures

Magnolia Pictures is an American film distributor, and is a holding of 2929 Entertainment, owned by Todd Wagner and Mark Cuban. Magnolia was formed in 2001 by Bill Banowsky and Eamonn Bowles, and specializes in both foreign and independent films....

, Brentwood Home Video, Ryko and Koch/Goldhil Entertainment.

Deciding factors

The format war's resolution in favor of Blu-ray was primarily decided by two factors: shifting business alliances, including decisions by major film studios and retail distributors, and Sony's decision to include a Blu-ray player in the PlayStation 3

PlayStation 3

The is the third home video game console produced by Sony Computer Entertainment and the successor to the PlayStation 2 as part of the PlayStation series. The PlayStation 3 competes with Microsoft's Xbox 360 and Nintendo's Wii as part of the seventh generation of video game consoles...

video game console

Video game console

A video game console is an interactive entertainment computer or customized computer system that produces a video display signal which can be used with a display device to display a video game...

Studio, distributor alliances

Studio alliances shifted over time. Before October 2005 and the release of either format, each had the exclusive support of three of the Big Six. HD DVD had Universal Studios, Paramount Pictures, and Warner Brothers Pictures, while Blu-ray Disc started out with Columbia Pictures, Walt Disney Pictures, and 20th Century Fox. Disney and Fox were both impressed by the extra DRM (BD+ and region coding) that the Blu-ray Disc format provided on paper (ironically, BD+ and region coding were both cracked in their first year). Then HD DVD supporters Warner Bros. and Paramount

Paramount Pictures

added support for Blu-ray. But in August 2007, after supporting Blu-ray for over a year, Paramount announced it would release all high-definition content (except titles directed by Steven Spielberg

Steven Spielberg

Steven Allan Spielberg KBE is an American film director, screenwriter, producer, video game designer, and studio entrepreneur. In a career of more than four decades, Spielberg's films have covered many themes and genres. Spielberg's early science-fiction and adventure films were seen as an...

) exclusively on HD DVD. At the same time, DreamWorks Animation SKG, which had not released any high-definition discs, announced it would release exclusively on HD DVD. Explaining their decisions, the companies cited perceived advantages to HD DVD's technology and lower manufacturing costs. The companies together received about $150 million in cash and promotional guarantees, including a Toshiba HD DVD marketing campaign with a tie-in to Shrek the Third
Shrek the Third
Shrek the Third is a 2007 American animated film, and the third film in the Shrek series. It was produced by Jeffrey Katzenberg for DreamWorks Animation, and is distributed by Paramount Pictures. It was released in U.S. theaters on May 18, 2007...

.

By August 2007, HD DVD appeared to have a promising future, was seeing its highest sales (though still substantially lower than Blu-ray), had support from major big-box retailers such as Wal-Mart

Wal-Mart

Wal-Mart Stores, Inc. , branded as Walmart since 2008 and Wal-Mart before then, is an American public multinational corporation that runs chains of large discount department stores and warehouse stores. The company is the world's 18th largest public corporation, according to the Forbes Global 2000...

due to low prices, and had the exclusive support of studios such as Paramount Pictures

Paramount Pictures

, DreamWorks SKG/Animation

DreamWorks Animation

DreamWorks Animation SKG, Inc. is an American animation studio based in Glendale, California that creates animated feature films, television program and online virtual worlds...

, Universal Studios

Universal Studios

Universal Pictures , a subsidiary of NBCUniversal, is one of the six major movie studios....

and several Indie film studios. The format also had non-exclusive though favorable support (through occasional HD DVD exclusive titles) from Warner Bros.

Warner Bros.

, the largest home video releaser.

The tipping point came on January 4, 2008 when Warner Bros.

Warner Bros.

, which has the largest market share of DVDs, announced plans to drop HD DVD support completely as of the beginning of June 2008. At the Consumer Electronics Show

Consumer Electronics Show

The International Consumer Electronics Show is a major technology-related trade show held each January in the Las Vegas Convention Center, Las Vegas, Nevada, United States. Not open to the public, the Consumer Electronics Association-sponsored show typically hosts previews of products and new...

in Las Vegas, some HD DVD-related events and private meetings with analysts and retailers were canceled, including an event scheduled for the eve of the show sponsored by the North American HD DVD Promotional Group. Toshiba management expressed disappointment over Warner's decision but said that Toshiba would continue promoting the competing format. The following Monday, Toshiba reduced the price of its HD DVD players by 40 to 50 percent, calling price a "deal breaker for the mainstream consumer". At the time, analyst Roger Kay of Endpoint Technologies Associates likened the price cut to the high-stakes Blackjack

Blackjack

Blackjack, also known as Twenty-one or Vingt-et-un , is the most widely played casino banking game in the world...

bet of "doubling down" in an effort to increase market share and "win back the studios". Richard Greenfield of Pali Capital called the move a gimmick and predicted that HD DVD would not become widely adopted. Gartner

Gartner

Gartner, Inc. is an information technology research and advisory firm headquartered in Stamford, Connecticut, United States. It was known as GartnerGroup until 2001....

analyst Hiroyuki Shimizu predicted that while the price cut might extend HD DVD's life somewhat, the limited title library would ultimately "inflict fatal damage on the format", leaving Blu-ray the victor by the end of 2008.

Warner Bros.' sister studio New Line Cinema

New Line Cinema

New Line Cinema, often simply referred to as New Line, is an American film studio. It was founded in 1967 by Robert Shaye and Michael Lynne as a film distributor, later becoming an independent film studio. It became a subsidiary of Time Warner in 1996 and was merged with larger sister studio Warner...

followed suit, canceling tentative plans to release titles on HD DVD. Other small studios and producers moving exclusively to Blu-ray included National Geographic Society

National Geographic Society

The National Geographic Society , headquartered in Washington, D.C. in the United States, is one of the largest non-profit scientific and educational institutions in the world. Its interests include geography, archaeology and natural science, the promotion of environmental and historical...

, Constantin Film

Constantin Film

- History :Constantin Film Distribution GmbH was founded by Waldfried Barthel and Preben Philipsen on April 1, 1950 in Frankfurt, Germany. On December 21, 1964, the name of the company was changed to Constantin Film GmbH....

, and Digital Playground

Digital Playground

thumb|right|250px|Digital Playground's 2010 Contract Girls at the [[AVN Adult Entertainment Expo]] at the [[Sands Expo]], [[Las Vegas, Nevada|Las Vegas]] on January 7, 2010...

.

Warner's move also caused a chain reaction among DVD distributors, most prominently in the form of Wal-Mart

Wal-Mart

's February 15, 2008 decision to phase HD DVD out completely by June 2008. Wal-Mart is the largest DVD retailer in the United States, and its decision prompted the New York Times to run a mock obituary for the HD DVD format. The newspaper quoted technology analyst Rob Enderle's contention that if Wal-Mart "says HD DVD is done, you can take that as a fact." Four days earlier, Best Buy

Best Buy

Best Buy Co., Inc. is an American specialty retailer of consumer electronics in the United States, accounting for 19% of the market. It also operates in Mexico, Canada & China. The company's subsidiaries include Geek Squad, CinemaNow, Magnolia Audio Video, Pacific Sales, and, in Canada operates...

began recommending Blu-ray Disc as the customer's digital format choice, and Netflix

Netflix

Netflix, Inc., is an American provider of on-demand internet streaming media in the United States, Canada, and Latin America and flat rate DVD-by-mail in the United States. The company was established in 1997 and is headquartered in Los Gatos, California...

, the largest online video rental service, began phasing out its HD DVD inventory after stocking both formats since early 2006.

These shifts were preceded by Blockbuster, the largest U.S. movie rental company, which in June 2007 had moved to Blu-ray exclusively in 1450 stores after test-marketing both formats at 250 stores and finding that more than 70% of high definition rentals were Blu-ray discs. In July 2007, Target Corporation

Target Corporation

Target Corporation, doing business as Target, is an American retailing company headquartered in Minneapolis, Minnesota. It is the second-largest discount retailer in the United States, behind Walmart. The company is ranked at number 33 on the Fortune 500 and is a component of the Standard & Poor's...

, began carrying only Blu-ray standalone players in its stores, promoting them with end cap displays featuring Blu-ray Disc movies from Sony and Disney. In January 2008, UK retailer Woolworths Group plc said it would stock only Blu-ray discs in its 820 stores beginning in March 2008.

PlayStation 3

Sony's decision to incorporate a Blu-ray Disc player as a standard feature of the PlayStation 3

PlayStation 3

video game console also helped ensure the format's eventual triumph. By the time Toshiba ceded the market, about 10.5 million of the Sony consoles had been sold worldwide versus an estimated 1 million HD DVD players – including both standalone units and the add-on player for Microsoft

Microsoft

's Xbox 360

Xbox 360

The Xbox 360 is the second video game console produced by Microsoft and the successor to the Xbox. The Xbox 360 competes with Sony's PlayStation 3 and Nintendo's Wii as part of the seventh generation of video game consoles...

console, which did not use the HD DVD add-on for gaming unlike the PS3 which had games that used the Blu-ray's added storage capacity. This equipment gap was a factor in Blu-ray titles (including the ones bundled with the PS3) outselling their HD DVD counterparts two to one in the United States and three or four to one in Europe.

Sony's strategy came at a cost. The company initially priced the PlayStation 3 at $599, roughly double the price of the PlayStation 2 and substantially higher than competing consoles. Despite this, the PS3 nonetheless sold at an estimated loss of more than US$200 per unit, resulting in losses estimated at about $3 billion. But analysts, such as Richard Cooper with Screen Digest, expect Sony to recoup far more than that.

Toshiba announcement and aftermath

On February 19, 2008, Toshiba announced it would cease developing, manufacturing and marketing HD DVD players and recorders. On that same day, Universal Studios

Universal Studios

Universal Pictures , a subsidiary of NBCUniversal, is one of the six major movie studios....

announced it would release its titles in the Blu-ray Disc format, following two years of exclusive HD DVD support. The studio subsequently released its final two HD DVD titles: Fletch
Fletch (film)
Fletch is a 1985 comedy film about a wisecracking investigative newspaper reporter, Irwin M. Fletcher , who writes under the name of Jane Doe...

on March 13, 2008 and Atonement
Atonement (film)
Atonement is a 2007 British romantic suspense war film directed by Joe Wright. It is a film adaptation of the 2001 novel of the same name by Ian McEwan. The film stars James McAvoy, Keira Knightley, and Saoirse Ronan. It was produced by Working Title Films and filmed throughout the summer of 2006...

on March 18. On February 20, 2008, Paramount Pictures announced it would back Blu-ray, becoming the last of the major studios to do so. Paramount ceased HD DVD production on February 28, 2008, with Things We Lost in the Fire
Things We Lost in the Fire (film)
Things We Lost in the Fire is a 2007 drama film directed by Susanne Bier and written by Allan Loeb. The film was released in the United States and Canada on October 19, 2007 and in the United Kingdom on February 1, 2008.-Plot:...

and Into the Wild
Into the Wild (film)
Into the Wild is a 2007 American biographical drama film directed by Sean Penn. It is an adaptation of 1996 non-fiction book of the same name by Jon Krakauer based on the travels of Christopher McCandless across North America in the early 1990s. The film stars Emile Hirsch as McCandless with...

becoming the studio's last HD DVD releases, both released March 4, 2008. The studio scrapped the HD DVD version of Bee Movie
Bee Movie
Bee Movie is a 2007 computer animated family comedy film starring Jerry Seinfeld, Renée Zellweger, Matthew Broderick, Megan Mullally, John Goodman, Chris Rock, Kathy Bates, and Patrick Warburton. Produced by DreamWorks Animation, it is directed by Simon J...

, which, on May 20, 2008, joined Face/Off
Face/Off
Face/Off is a 1997 action thriller film directed by John Woo, starring John Travolta and Nicolas Cage. The two both play an FBI agent and a terrorist, sworn enemies who assume the physical appearance of one another....

and Next in becoming the studio's first Blu-ray releases since becoming HD DVD exclusive. In April 2009, Warner Home Video announced it would trade up to 25 HD DVDs for the Blu-ray equivalents, charging only for shipping and handling.

Microsoft ceased production of Xbox 360 HD DVD players while considering how its HDi and VC-1

VC-1

VC-1 is the informal name of the SMPTE 421M video codec standard, which was initially developed as a proprietary video format by Microsoft before it was released as a formal SMPTE standard video format on April 3, 2006...

technologies could be applied to other platforms. Microsoft's VC-1 codec is already in use in Blu-ray titles; Warner Bros.

Warner Bros.

encodes the main features of all titles in the format but encodes supplements and bonus content in MPEG-2

MPEG-2

MPEG-2 is a standard for "the generic coding of moving pictures and associated audio information". It describes a combination of lossy video compression and lossy audio data compression methods which permit storage and transmission of movies using currently available storage media and transmission...

. Microsoft has since entered into talks with Sony regarding Blu-ray, although Windows Vista

Windows Vista

Windows Vista is an operating system released in several variations developed by Microsoft for use on personal computers, including home and business desktops, laptops, tablet PCs, and media center PCs...

has supported basic filesystem and shell functionality for both Blu-ray Disc and HD DVD since launch, relying on third parties to implement movie playback. Rumors of a Blu-ray drive for the Xbox 360 have been officially denied by Microsoft.

Toshiba's pull-out did not have an immediate significant effect on stand-alone Blu-ray player sales, which rose 2 percent from February to March 2008, after falling 40 percent between January and February, according to NPD Group. NPD noted that upconverting DVD player sales rose 5 percent in the first quarter of 2008 over the same quarter of 2007 but did not release a comparison of first quarter Blu-ray sales compared to the same quarter of 2007. At the time of the report, upconverting DVD players cost around $70 versus $300 for Blu-ray players. But in spring 2009, the number of Blu-ray players nearly doubled its year to date 2009 sales over the same period 2008: about 9 million high-definition units sold in the U.S. from January through March, up from the 4.8 million that sold during first-quarter 2008, according to Adams Media Research. In April 2008, the firm estimated a total of 10.5 million Blu-ray households, including Blu-ray consoles and Blu-ray-enabled PlayStation 3s.

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