With the recent decision by Paramount (and its distribution of Dreamworks) to drop Blu-ray, the HD-DVD/Blu-ray format war is now virtually assured of stretching well into 2008, if not beyond. A lot of articles and discussion board posts have forwarded the notion that this format war is good for consumers in that competition between the two sides has pushed hardware prices down faster than would have otherwise occurred with a single format.

I'll agree that Toshiba has been forced to rapidly lower its hardware prices, while Blu-ray has had to push the price points down to $500 in response. Lower prices can be a good thing.

But, I would also argue that the HD format war has seriously impeded adoption by consumers, which hurts the long terms prospects for these HD formats to eventually supplant the DVD as the dominant home video format. With one unified format, you have the entire industry involved and a clear, focused marketing message to consumers. As it stands, there is widespread confusion and plenty of enthusiasts sitting on the fence, because they would rather wait until the market settles down before committing to either format.

Today, IMDB posted a poll asking what people thought of Paramount/Dreamworks' decision to go HD-DVD only. With over 16k votes tallied, a full 63% indicated "I have neither system and this makes (me) want to enter HD media even less. I'll stick with DVD for the time being." If putting a damper on the HD disc market was the intention of this move, then it appears to have succeeded.

http://www.imdb.com/poll/results/2007-08-25

Any which way you look, I just don't see this HD format war benefiting consumers in the long run. In the short term, it might have accelerated price declines on HD-DVD and Blu-ray players. But, I think in the long run, it will impede growth, which increases the chances of both formats failing in the market. And if the end result is a dual format compromise, this creates higher prices for consumers because of the need for dual format players, hybrid disc media, and/or added costs due to retailers having to maintain multiple inventories.