It's Official: Toshiba Announces Discontinuation of HD-DVD Businesses

[Woochifer]

Format war's now officially over. HD-DVD is dead, and now all of the studios and CE companies can rally behind a single unified HD optical format. Two years late, but I guess better than never.

Hot off the wire, here's the Toshiba announcement ..

http://www.businesswire.com/portal/s...51&newsLang=en

Toshiba Announces Discontinuation of HD DVD Businesses

Company Remains Focused on Championing Consumer Access to High Definition Content

TOKYO--(BUSINESS WIRE)--Toshiba Corporation today announced that it has undertaken a thorough review of its overall strategy for HD DVD and has decided it will no longer develop, manufacture and market HD DVD players and recorders. This decision has been made following recent major changes in the market. Toshiba will continue, however, to provide full product support and after-sales service for all owners of Toshiba HD DVD products.

HD DVD was developed to offer consumers access at an affordable price to high-quality, high definition content and prepare them for the digital convergence of tomorrow where the fusion of consumer electronics and IT will continue to progress.

“We carefully assessed the long-term impact of continuing the so-called 'next-generation format war' and concluded that a swift decision will best help the market develop,” said Atsutoshi Nishida, President and CEO of Toshiba Corporation. "While we are disappointed for the company and more importantly, for the consumer, the real mass market opportunity for high definition content remains untapped and Toshiba is both able and determined to use our talent, technology and intellectual property to make digital convergence a reality.”

Toshiba will continue to lead innovation, in a wide range of technologies that will drive mass market access to high definition content. These include high capacity NAND flash memory, small form factor hard disk drives, next generation CPUs, visual processing, and wireless and encryption technologies. The company expects to make forthcoming announcements around strategic progress in these convergence technologies.

Toshiba will begin to reduce shipments of HD DVD players and recorders to retail channels, aiming for cessation of these businesses by the end of March 2008. Toshiba also plans to end volume production of HD DVD disk drives for such applications as PCs and games in the same timeframe, yet will continue to make efforts to meet customer requirements. The company will continue to assess the position of notebook PCs with integrated HD DVD drives within the overall PC business relative to future market demand.

This decision will not impact on Toshiba’s commitment to standard DVD, and the company will continue to market conventional DVD players and recorders. Toshiba intends to continue to contribute to the development of the DVD industry, as a member of the DVD Forum, an international organization with some 200 member companies, committed to the discussion and defining of optimum optical disc formats for the consumer and the related industries.

Toshiba also intends to maintain collaborative relations with the companies who joined with Toshiba in working to build up the HD DVD market, including Universal Studios, Paramount Pictures, and DreamWorks Animation and major Japanese and European content providers on the entertainment side, as well as leaders in the IT industry, including Microsoft, Intel, and HP. Toshiba will study possible collaboration with these companies for future business opportunities, utilizing the many assets generated through the development of HD DVD.

[diggity]

about time. but it is strange, after such a long time and all the talk of "will they give it up?", now it is has happened it is sort of an anti-climax.

[kexodusc]

Flash back to 2004 and most of us ar.com old-timers predicted this day.
Not surprised to see Toshiba bow out gracefully, they've always been a very practical company, not afraid to take risks, but mindful of what's working and what isn't. If the situation were reversed, you could bet Sony would be fighting until the bitter end, which would be at least a few years from now.

Sony's decision to integrate BluRay into the PS3 might be the single biggest difference in this war. While not every PS3 owner bougth BluRay discs, a good portion did. I think without that factor, Toshiba might very well have been able to persuade the studios to make the switch, especially if they sold more hardware and thus more software. At the very least it would have drawn things out a lot longer. These things are always a battle of momentum. PS3 helped BluRay grab it early and never lose it. Without PS3, BluRay doesn't look so attractive to fence sitters deciding where to place their bets. When hardware sales are measured in the hundreds of thousands, having a few million Play Station owners buying a disc or two certainly skews the early-adopter standings. I wonder if any kind of analysis will be done to verify this.

I'm guessing all the Sony fanboys will be flinging out the flags and singing songs of victory today. Life goes on for the rest of us...

Now we can turn our focus back to the real format war:

Boxers vs. Briefs

Discuss.

[bfalls]

Let's make the discussion "brief".

[L.J.]

[Woochifer]

Flash back to 2004 and most of us ar.com old-timers predicted this day.
Not surprised to see Toshiba bow out gracefully, they've always been a very practical company, not afraid to take risks, but mindful of what's working and what isn't. If the situation were reversed, you could bet Sony would be fighting until the bitter end, which would be at least a few years from now.

Sony's decision to integrate BluRay into the PS3 might be the single biggest difference in this war. While not every PS3 owner bougth BluRay discs, a good portion did. I think without that factor, Toshiba might very well have been able to persuade the studios to make the switch, especially if they sold more hardware and thus more software. At the very least it would have drawn things out a lot longer. These things are always a battle of momentum. PS3 helped BluRay grab it early and never lose it. Without PS3, BluRay doesn't look so attractive to fence sitters deciding where to place their bets. When hardware sales are measured in the hundreds of thousands, having a few million Play Station owners buying a disc or two certainly skews the early-adopter standings. I wonder if any kind of analysis will be done to verify this.

Blu-ray was playing with a very stacked deck all along. The structure of the market put Blu-ray at an advantage in every facet. They had more studios on board with a much larger share of the highest grossing movie titles, and they had more manufacturers on board, as well as a technical advantage with its larger disc capacity. The PS3 gave Blu-ray a crucial push by keeping the studios on board and creating a larger installed user base.

Toshiba tried to offset Blu-ray's inherent market advantage by lowering the price points, and later on, paying Paramount/Dreamworks to drop Blu-ray. But, they could never create a level playing field for HD-DVD. Too many forces were arrayed in Blu-ray's favor.

I'm guessing all the Sony fanboys will be flinging out the flags and singing songs of victory today. Life goes on for the rest of us...

Trek over to the smackdown forum over at High Def Digest if you want to see the meltdown in progress. Surprisingly, you still have some HD-DVD holdouts in denial, but several of the HD-DVD fanboys have now migrated over to the none-of-this-matters-because-downloads-will-win-eventually-anyway camp. It's just bizarre to me. I checked in around midnight PST, and there were over 1,500 people logged in, and the posts were flying furiously.

[kexodusc]

Trek over to the smackdown forum over at High Def Digest if you want to see the meltdown in progress. Surprisingly, you still have some HD-DVD holdouts in denial, but several of the HD-DVD fanboys have now migrated over to the none-of-this-matters-because-downloads-will-win-eventually-anyway camp. It's just bizarre to me. I checked in around midnight PST, and there were over 1,500 people logged in, and the posts were flying furiously.

HD-DVD holdouts In denial? That's fanboyism that borders on insanity.

We're 6-8 years minimum away from the infrastucture being able to support a downloading medium that could offer the equivalent performance of BluRay (the ol' bandwidth, file size argument) to a reasonable portion of the population. They can't even keep up with the demand for illegal video downloads at 1/40th the file size, and they're worried about what's going to happen as more and more HD channels enter the mix. Assuming the studios even want to support a non tangible format in that capacity (I highly doubt they will). And even if they did, tangible formats will continue to endure.

That attitude is a like the VHS camp saying they aren't going to adopt DVD because a future HD format is on the horizon. Retarded.

Maybe by 2017, in the meantime, I'm not missing out on a ton of entertainment. Now, how long do I have to wait for prices to drop on a PS3/BluRay player?

[L.J.]

So, how long before we see HD DVD titles dropping below the $10 mark?

[Woochifer]

So, how long before we see HD DVD titles dropping below the $10 mark?

That might vary depending on how desperate retailers are to thin out their HD-DVD shelf space, and if the studios provide any incentives. I'm pretty sure that retailers have totally curtailed their wholesale orders since Warner's announcement, so they've already started letting the shelves empty out on their own.

I don't recall any clearance sales for SACD and DVD-A -- retailers like BB and Fry's simply stopped restocking those sections. And when the inventories got small enough, they simply integrated the remaining discs into the CD bins. Would be easy to simply mix HD-DVDs into the DVD sections, since a lot of the releases are combo discs.

HD-DVD players though are a different story. Toshiba apparently plans to have them entirely out of retail channels by the end of March, so I see clearance sales aplenty there.

[Woochifer]

HD-DVD holdouts In denial? That's fanboyism that borders on insanity.

It's been quite amusing to see the fanboys going back and forth over the past year on that site. There are other HD-DVD fanboys who steadfastly refuse to support Blu-ray at any cost, and have vowed to stay with upconverted DVDs. Makes no sense to me at least to vehemently support a HD format, and turn around and go back to SD resolution just because the HD format someone supports becomes orphaned. Granted though, it seems the majority of HD-DVD owners on that site plan to go Blu-ray or already have. There's just a vocal minority on site that's so anti-Sony that they can't rationalize what the market trends are telling them.

We're 6-8 years minimum away from the infrastucture being able to support a downloading medium that could offer the equivalent performance of BluRay (the ol' bandwidth, file size argument) to a reasonable portion of the population. They can't even keep up with the demand for illegal video downloads at 1/40th the file size, and they're worried about what's going to happen as more and more HD channels enter the mix. Assuming the studios even want to support a non tangible format in that capacity (I highly doubt they will). And even if they did, tangible formats will continue to endure.

Totally agree. Right now, every download scheme out there has a significant limitation of some kind (excessive DRM, confusing setup procedures, hard drive capacity, etc.). And even for people willing to live with these restrictions, the bandwidth limitations are real for most households. Fiber is not widely available or affordable yet, and many rural communities don't even have basic broadband access (aside from very expensive and relatively slow satellite internet services).

With the format war over, Blu-ray's main obstacle now is overcoming the DVD format. Downloading has got a much taller task ahead, especially if the files remain as locked down as they are.

[L.J.]

Universal to release on Bluray. I know, I know......but Wooch can't take all the good posts......add SirT to that list as well


http://www.highdefdigest.com/news/sh..._Goes_Blu/1483
http://www.blu-ray.com/news/?id=1007

[diggity]

one still wonders though if blu-ray came out to early. with the kerfuddel of the bluray profile compatability on older players, will the early supporters be happy with the victory if they cant play future content correctly? although i have not invested one cent in hd-dvd, at least it was a developed format, i just dont think it was marketed as well. if microsoft built in the hd dvd player it would have been a completely different story, missed an oppurtunity there.

and i prefer boxers

cheers:dazza

[Woochifer]

Universal to release on Bluray. I know, I know......but Wooch can't take all the good posts......add SirT to that list as well


http://www.highdefdigest.com/news/sh..._Goes_Blu/1483
http://www.blu-ray.com/news/?id=1007

Wow, the dominoes have fallen quickly! Paramount/Dreamworks is the last remaining holdout, and I doubt that they will last long on the sidelines given that they've already purportedly got a whole warehouse full of Blu-rays that they abruptly withdrew from distribution back in August when they went HD-DVD exclusive. I guess they haven't finished counting the $150 million that Toshiba gave them? (Gawd, in retrospect Paramount and Dreamworks made out like bandits in that deal -- they've already pocketed Toshiba's money and only a few months later they're now free to issue high grossing titles like Transformers and Shrek 3 on Blu-ray while they still have shelf life in 'em.)

P.S. I'm perfectly fine with abdicating some "good posts" to you or T or whoever else wants to pull the trigger. Just know that I be fast, so don't you be slow!

[Woochifer]

one still wonders though if blu-ray came out to early. with the kerfuddel of the bluray profile compatability on older players, will the early supporters be happy with the victory if they cant play future content correctly? although i have not invested one cent in hd-dvd, at least it was a developed format, i just dont think it was marketed as well. if microsoft built in the hd dvd player it would have been a completely different story, missed an oppurtunity there.

and i prefer boxers

cheers:dazza

Of course Blu-ray came out way too early, but so did HD-DVD.

Recall that Toshiba's first batch of HD-DVD players were limited to 1080i resolution, and had all sorts of bugs and loading problems. It wasn't until the second batch of firmware updates a few months later that HD-DVD overcame a lot of the early production problems. But, even now HD-DVD players have had many more playback glitches (particularly with Warner's combo discs) than Blu-ray players, with the exception of maybe Samsung's problematic early models.

The Blu-ray Profile 1.0 does not prevent anyone from accessing a movie or basic features. It's only interactive content or features such as PiP that might not work when playing an advanced profile Blu-ray disc. Plus, the majority of Blu-ray players in use (i.e., the PS3) are already setup for Profile 2.0 with a simple firmware update.

This is quite different than Toshiba's much-touted tri-layer TL-51 HD-DVD disc format. This format would bump up the HD-DVD disc capacity to 51 GB (1 GB more than a 50 GB dual-layer Blu-ray disc). While this would have brought HD-DVD's disc capacity to parity with Blu-ray, any discs published using the TL-51 format would have been incompatible with existing HD-DVD players.

HD-DVD was rushed to market in order to gain a headstart on Blu-ray. Blu-ray was rushed to market in order to counter HD-DVD, and keep the Xbox360 from growing too large a lead in the console market. The Xbox 360 was rushed to market without an integrated HD-DVD drive because MS was more concerned about gaining a headstart over the PS3 and limiting their hardware costs than wholeheartedly supporting HD-DVD. And all the while, the PS3 was delayed because seeding the market for Blu-ray was more important to Sony than its console gaming market share.

And I'm actually of the opinion that the DVD format came out way too early, and should have been a HD format from the very beginning since the HDTV standards were locked in place well before the DVD specs were finalized. But, such is life in the digital age, where formats get locked into what's currently feasible, while the underlying technology continues to advance by leaps and bounds.

[Sir Terrence the Terrible]

one still wonders though if blu-ray came out to early. with the kerfuddel of the bluray profile compatability on older players, will the early supporters be happy with the victory if they cant play future content correctly? although i have not invested one cent in hd-dvd, at least it was a developed format, i just dont think it was marketed as well. if microsoft built in the hd dvd player it would have been a completely different story, missed an oppurtunity there.

and i prefer boxers

cheers:dazza

I think both formats came out too early. Toshiba's A1 and XA-1 were as big a diaster as their latest offerings are. I do not think that HD DVD was all that developed of a format. Yes it had PIP, yes it had more interactivity, but with a smaller pipeline and less disc capacity, it could not take advantage of these pluses without the exclusion of Dolby TrueHD on the disc. No other codecs aside from VC-1 are primarily used on HD DVD, AVC has been used, but that use has been sponsered by Toshiba, and it was Toshiba's AVC encoder. DTHD was totally underutilized, and because of the constant use of VC-1, and average to poor transfers, HD DVD video scores compared to Blurays suffered. Quality control was all over the map, with some players doing just fine, and other unable to make it through a movie.

Microsoft did not build a HD DVD drive into the XBOX360 was very telling. They must have known that HD DVD had an uphill battle, and didn't want their franchise to suffer if it went belly up. I seriously doubt that microsoft really believed in HD DVD. I believe they supported it to get back at the BDA, and Sony for not adopting HDi or VC-1 as part of the manditory spec for Bluray. The fact they did not participate in negotiations with Warner was also very telling. I think Microsoft has pretty much torn their pants in Hollywood.

[Woochifer]

Microsoft did not build a HD DVD drive into the XBOX360 was very telling. They must have known that HD DVD had an uphill battle, and didn't want their franchise to suffer if it went belly up. I seriously doubt that microsoft really believed in HD DVD. I believe they supported it to get back at the BDA, and Sony for not adopting HDi or VC-1 as part of the manditory spec for Bluray. The fact they did not participate in negotiations with Warner was also very telling. I think Microsoft has pretty much torn their pants in Hollywood.

The other issue with the Xbox360 is that the console itself came out before HD-DVD was introduced, and there MS was deadset on getting the Xbox360 as big a head start as possible over the PS3. To them, waiting for the HD-DVD drives to arrive in mass quantities would have meant missing out on the holiday shopping season in 2005, and bumping up the console price by probably about $100. Even so, the Xbox360 still got rushed to market, and has been plagued by QC problems (a report that came out last week shows the Xbox 360 with a failure rate more than 5X greater than for the Wii and PS3). To MS, the gaming market share meant everything, so there was no way that they would let HD-DVD's timetable affect the Xbox360 introduction.

Lost amidst the shockwave created by the Warner announcement in January was the rumors regarding MS' HD-DVD plans for the Xbox360. Bill Hunt reported that Bill Gates' keynote speech at CES included numerous HD-DVD announcements, including a Xbox360 model with an integrated HD-DVD drive. But, once Warner's announcement hit, MS had to completely backtrack and jettison close to 40% of Gates' original presentation. I wonder how many of those HD-DVD Xbox360s are now sitting in limbo at some warehouse!

Sony on the other hand was perfectly willing to sacrifice market share on the gaming side to ensure that Blu-ray would become the next-gen optical format of choice. The PS3 had all sorts of technical issues crop up while the Cell processor was in development, yet in the end the bottleneck was the Blu-ray drive. On the gaming side, with these delays and the very high introductory price (largely driven by the Blu-ray drive's initially high cost), the PS3 not only lost market share, but it also lost most of its exclusive franchises. Only last month did PS3 console sales finally pass the Xbox360.

Sony paid a high price to get Blu-ray where it is now. We'll find out in the next few years if Blu-ray's victory was worth sacrificing the Playstation franchise's market lead.

I totally agree that MS' HD-DVD support was both half-a$$ed and two-faced. Their market push was VC-1 and downloading, and still is. HD-DVD was simply an opportunity for them to throw a monkey wrench into Blu-ray, which had already amassed the vast majority of the CE players and major studios.

[diggity]

im sorry iwasn't aware of the problems toshiba had with their early players, we only really got into hd-dvd here in australia with their latest batch. before that we didn't have many outlets selling them. what is interesting is that only 2 weeks ago toshiba sales repcame to me and asked if would consider stocking hd-dvd players, to which i politlely said no, two days later they approached company owner and told him of all the software "sales" hd-dvd has and he said yes. we now have 20 players!!

interesesting to see what deals they will do so i can get rid of them. i also 100% agree with both of you thats xbox360 came out too early with so many buge, overheating, unstavle disc tray, xboxlive crashing nearly once a month just to get a lead on sony. but now bluray has won ps3 sales should rise sharply as its a very good way to get hd playback at a good price.

cheers dazza

[Mr Peabody]

So how long will DVD last? Will BR eventually take over? How long before we see Chinese $50.00 BR players?

I could live without special features if my Samsung would just play all the BR titles.

You guys watch bad mouthing downloading, Nightflier and Pix will be in here ready to clean house

[pixelthis]

So how long will DVD last? Will BR eventually take over? How long before we see Chinese $50.00 BR players?

I could live without special features if my Samsung would just play all the BR titles.

You guys watch bad mouthing downloading, Nightflier and Pix will be in here ready to clean house

DVD will be here for awhile.
HD on disc is more evolutionary than revolutionary.
Truth is you need a 1080p set to take full advantage, and a lot couldnt see much difference at first, although the later 1080p players on a matching set were amazing, really.
As for 50$ chinese BLU players, it took awhile for DVD players to get really cheap.
I would guess a bare bones Blu player will hit the market in a year or two for 150$.
And Kex is right about net downloading being about a decade away.
But VOD is here today, so who needs it?

[Sir Terrence the Terrible]

DVD will be here for awhile.
HD on disc is more evolutionary than revolutionary.
Truth is you need a 1080p set to take full advantage, and a lot couldnt see much difference at first, although the later 1080p players on a matching set were amazing, really.
As for 50$ chinese BLU players, it took awhile for DVD players to get really cheap.
I would guess a bare bones Blu player will hit the market in a year or two for 150$.
And Kex is right about net downloading being about a decade away.
But VOD is here today, so who needs it?

Sorry, but VOD has the same bandwidth issues as downloading does, so its no answer to this issue. VOD bandwidth issues have been ongoing for years. Here is one article on it as late as august 2007

http://arstechnica.com/news.ars/post...th-crunch.html

Comcast is adding more HD movies, but not more HD channels because of bandwidth issues. The same goes for Warner. The pipeline for VOD and downloading is the same, so to attempt to break one out from another is fruitless, and would not be accurate measure of reality.

Anyone who tells you that you have to have a 1080p television to enjoy bluray is an idiot. Oppps, didn't mean to call you out Pixeless

[pixelthis]

Sorry, but VOD has the same bandwidth issues as downloading does, so its no answer to this issue. VOD bandwidth issues have been ongoing for years. Here is one article on it as late as august 2007

http://arstechnica.com/news.ars/post...th-crunch.html

Comcast is adding more HD movies, but not more HD channels because of bandwidth issues. The same goes for Warner. The pipeline for VOD and downloading is the same, so to attempt to break one out from another is fruitless, and would not be accurate measure of reality.

Anyone who tells you that you have to have a 1080p television to enjoy bluray is an idiot. Oppps, didn't mean to call you out Pixeless

You mentioned an "idiot " so I took no offense, assumed you were talking to youreself again.
To think that a new fibre optic cable system would have "bandwidth" issues is
typical of your ignorance.
Real quick survey, who has had a little message pop up while watching a VOD feature
that says they are having "bandwidth" issues?
I thought so.
As for the 1080p issue, I am again talking about the real world, something you are totally out of touch with.
And people watching a display with a 1080i or 720p set couldnt tell much diff,
myself included.
And that is the predominant TV that is out there yet

[Sir Terrence the Terrible]

You mentioned an "idiot " so I took no offense, assumed you were talking to youreself again.

There is only one idiot here and that is you. So what you should have done is just wagged your tail and acknowledged that your name was called.

To think that a new fibre optic cable system would have "bandwidth" issues is
typical of your ignorance.

97% of American does not have fibre. 40% do not even have broadband or digital cable.

Real quick survey, who has had a little message pop up while watching a VOD feature
that says they are having "bandwidth" issues?
I thought so.

You have totally earned the title as Audioreviews online fool with this one. Once again picking and choosing what you want to acknowledge while ignoring evidence put before your face/ass(only your mother knows the difference). So much for wisdom with age.

As for the 1080p issue, I am again talking about the real world, something you are totally out of touch with.
And people watching a display with a 1080i or 720p set couldnt tell much diff,
myself included.
And that is the predominant TV that is out there yet

If you cannot tell the difference between 1080i and 720p then you have vision isssues. The real world is not in the Appalachian Mountains where stone age creatures like yourself reside. It a little bigger than that brainless wonder.

[Mr Peabody]

If there are no bandwidth issue with either satelite or cable, then why aren't all of the HD stations in 5.1 on content like modern movies where you know it should be? So far only the premium movies stations are in 5.1, HBO, Showtime, Starz etc. My suggestion for that industry would be to get what they already provide up to par before worrying about expanding or trying to sell me something else.

[pixelthis]

If there are no bandwidth issue with either satelite or cable, then why aren't all of the HD stations in 5.1 on content like modern movies where you know it should be? So far only the premium movies stations are in 5.1, HBO, Showtime, Starz etc. My suggestion for that industry would be to get what they already provide up to par before worrying about expanding or trying to sell me something else.

That comes from the channel.
If a channel is HD they can show 5.1 DD, which is the standard , or DD 2.0.

Don't blame the provider for decisions made by the programer.
Look at the crap on "A&E" HD for instance.
A lot is pan and scan , and most isn't even stereo.
Their presentation of some movies should be criminal.

And I HAVE SEEN 4:3 movies on every so called "premium " channel available.
but its like when MTS was instituted.
Took awhile for everybody to get up to speed

[Sir Terrence the Terrible]

If there are no bandwidth issue with either satelite or cable, then why aren't all of the HD stations in 5.1 on content like modern movies where you know it should be? So far only the premium movies stations are in 5.1, HBO, Showtime, Starz etc. My suggestion for that industry would be to get what they already provide up to par before worrying about expanding or trying to sell me something else.

Mr. P, the problem is they can't easily or cheaply do it. Laying fibre is extremely expensive. Verizon is already way off schedule in their rolling out of FIOS, it is not cheap, and some areas will never get it because of regulatory or contractual issues.

VOD is in competition with downloads, who are in competition with FIOS, who is in competition with cable in general. With this kind of interaction, and everyone with their own interests, VOD and downloading have quite a ways to go, and may never overtake HDM on disc to own. Renting disc MAY take a bit of a hit, but the model for purchasing digital files has alot of developement to do before it will be adopted by the masses, or even the semi masses. Enjoy your bluray player.