In early 2007, representatives from each side of the biggest format war to hit store shelves since VHS vs. Betamax visited a major film studio in Los Angeles. Presenting separately, they highlighted the benefits of choosing their respective software. The people soliciting on behalf of HD DVD touted an easier conversion of factories already making standard DVDs, while lobbyists for Blu-ray described a greater storage capacity of 25 gigabytes, 10 more than the alternative.
Just before departing, one of Blu-ray’s advocates repeated that they’d be willing to do anything to garner the studio’s business. “But remember,” he said, “we were never here.”
The studio was Wicked Pictures, producer and distributor of such adult-themed fare as Good Will Humping and Hotel No Tell. With a 10 percent stake in the $24 billion home video market, salacious movies were often the first to adopt the newest technologies; by courting their business, each format was hoping to trump the other.
Lasting from mid-2006 until early 2008, Sony’s Blu-ray and Toshiba’s HD DVD rivalry took few prisoners. There were allegations of bribes, public relations sniping, and even threats of physical violence among devotees. For Toshiba, who had spent millions developing high-resolution home video, it was an opportunity to expand their market; for Sony, it was an opportunity to wash out the sour taste of seeing their Betamax hardware sent to landfills in the early 1980s. They were determined to make sure that didn't happen again.
Getty
From the time manufacturers realized that blue lasers could pick up data using a shorter wavelength—allowing more information to be packed into a standard optical disc—the idea of high-definition digital software as an eventual replacement for DVD was a natural fit. Those discs, introduced in 1995, had only 480 lines of vertical resolution; the newer HD television sets could display up to 1080 lines. As many as 16 million U.S. households were renting or buying movies that were inferior to the monitor they were being screened on.
Toshiba and Sony shortly became polar opposites in the battle for that market share. Each wanted to dominate what they perceived would be a lucrative licensing arrangement with other manufacturers; Sony, in particular, saw the potential for profits in exploiting their own entertainment library by reissuing catalog titles on the new format.
Both announced plans in 2002. By 2005, sensing the retailer and consumer complaints that would come with yet another “format war,” the two attempted what amounted to a home video peace treaty. But each found the other’s limitations at fault: Blu-ray was harder to integrate into computer assemblies, while HD DVD lacked storage capacity. Talks broke off, and both companies plowed ahead, separately. After delays in getting copy protection issues resolved, neither released a piece of hardware until the spring of 2006.
At $599, Toshiba’s introductory model was actually selling below the $674 they spent in parts for each one; Sony, unwilling to present a loss leader, introduced a Blu-ray player at a $1000 price point. As with virtually any new piece of technology, only the most enthusiastic early adopters dove in. Most everyone else waited to see which one held the most promise.
More Articles About DVDs:
Sony obviously had no intention of issuing their studio films on a rival format, so titles like Sam Raimi’s Spider-Man were exclusive to Blu-ray. HD DVD had exclusive agreements with Paramount and Universal, meaning that films like The Bourne Identity were available in red-tinted packaging that signaled a compatible disc for HD DVD players.
Some studios—Paramount and Warner Bros. among them—refused to choose sides, releasing their titles on both formats; Netflix shipped movies in whichever format the customer preferred.
By the end of 2006, HD DVD titles had collectively outsold Blu-ray virtually every week. But Sony had already laid out a plan to bring the conflict to a swift and unmerciful end in 2007.
Getty
Even though industry estimates had Toshiba and their partners moving roughly 578,000 HD DVD players by the end of 2007, with 370,000 Blu-ray players coming in a distant second, those numbers didn’t factor in Sony’s Trojan horse: the Playstation 3.
The third generation video game console had the ability to play Blu-ray discs, a feature that seemed almost altruistic on Sony’s part. At $499, it was as cheap—or cheaper—than most video players of the era. If you wanted a Blu-ray component, it was a deal; if you just played video games, there would probably come a day when you’d begin to buy movies supported by the device.
While hardware sales appeared close, it didn’t quite reflect the reality. At a time HD DVD was looking to be in 750,000 total homes in the U.S., Sony had moved 2.4 million Playstations; worldwide, they had created over 10.5 million households that had the ability to play Blu-ray films.
Toshiba tried to get more aggressive. They reportedly paid $150 million to Paramount and DreamWorks Animation to go exclusively with HD DVD; they slashed prices on players, with entry-level units going for as low as $99.
LG tried to play both sides by introducing a dual-format player. At $1000, consumers weren’t interested. In fact, they were actually confrontational about the wallet-emptying maneuvering; one popular discussion board, AVSForum.com, was shut down in late 2007 over threats of violence directed at members who supported the competing medium.
Although Warner Bros. initially took a similar approach—the studio even issued movies with both formats in the same package, a compromise they called Total HD—they could see sales were leaning in Sony’s direction. Titles like Harry Potter, which were released on both HD DVD and Blu-ray, saw Blu outselling the rival software by two to one.
That kind of straight comparison was enough to force a decision. In early 2008, Warner Bros. announced they would be backing Blu-ray exclusively. With a leading share of home video sales, the studio’s choice made retailers fall in line. Walmart, Best Buy, and Target dropped HD DVD hardware and software. Harry Potter had called it.
Amazon
In a rare moment of corporate humility, so did Toshiba. In February 2008, company president and CEO Akio Ozaka declared production of HD DVD devices would cease immediately. Sony, meanwhile, tried to shake off reports that they had paid Warner Bros. $500 million to expedite their commitment to Blu-ray. (The allegation, first reported by Pittsburgh Post-Gazette columnist Don Lindich, was never confirmed by either studio.)
In the two major home video battles of the past 40 years, Sony holds a respectable 1-1 record. They might soon have a chance to improve upon it: The latest in video cornea massages, high dynamic range (HDR), is beginning to draw lines in the sand, with Sony backing technology dubbed HDR10 and other manufacturers opting for Dolby Vision. Beyond bragging rights, the stakes for being wrong in these situations are high. By supporting HD DVD in 2006, Toshiba lost an estimated $1 billion.
Wicked Pictures has yet to choose a side.