Yippee! HD-DVD!

[Tones]

Original story


AUG. 2 | In a scene somewhat reminiscent of the DVD format's tumultuous adoption by content providers in the mid-'90s, top executives at the major studios met quietly last week in Los Angeles to discuss the opportunities and challenges for a high-definition version of DVD.

The ultimate outcome of the meeting could mean that consumers could have access to HD-capable DVD players and packaged media as soon as the fourth quarter of 2003, according to several sources.

However, the decision of which technology is used and how quickly it comes to market might once again become a battleground over issues that have more to do with politics and patents than choosing the best technology.

The first reconvening in some time of the Hollywood Advisory Council, which was formed in 1994 relative to the creation of DVD, was described as a first unofficial step toward a unified approach in making sure the needs and desires of content providers are made clear to technology developers from the earliest stage.

The HAC includes executives from virtually every major studio's home video division but has no organizational structure and therefore no official spokesperson. Some of those involved call it a "loose, ad hoc committee," a term that some say was adopted by the group to avoid arousing the suspicions of government antitrust officials.

The July 31 HAC meeting at the Walt Disney Co. compound in Burbank will be followed by a smaller sub-committee gathering within the next several months. The notes will be passed onto the DVD Forum, the industry consortium that develops and maintains official DVD specifications.

Last week's gathering "was really a kick-off meeting to discuss what we'd like to see," said one studio official who attended. "Warren [Lieberfarb, president of Warner Home Video,] gave a lecture, but not a lot was discussed or agreed to."

Indeed, while the meeting lacked the discord surrounding the adoption of DVD, consumer electronics analysts said Warner has once again taken a leadership position for the sooner-than-later introduction of a new home entertainment format.

Although HDTV has been slow to take off--only 3 million homes currently have sets--the Consumer Electronics Association reports record-high consumer satisfaction levels for HDTV and estimates 30% market penetration by 2006. There's consensus among the big studios that development of some form of HD-capable packaged media is a good thing.

There's also agreement that copy-protection standards must be much more stringent than they were the last time everyone got together to work out a new format. "The copy protection on DVD is a joke," said one studio official. "Looking at a high-definition disc, if there's no meaningful protection, we're not going to put our vaults in the public domain."

Warner also believes time is of the essence in getting an optical-disc HD format to market since HD-capable Digital VHS, which is embraced by 20th Century Fox Home Entertainment, is already in the hands of a small number of consumers.

Of course, with several HD-capable packaged media formats in development, patents and other self-interests could prove to be divisive in deciding which one to choose.

Warner is said to be pushing for the adoption of what is essentially a soupped-up version of the traditional red-laser-based DVD technology. Based on powerful compression algorithms being co-developed by Microsoft Corp.--a participant that seems to deliver a "what are they up to?" chill down the spines of some studio officials--red-laser HD DVD uses what is essentially a DVD-9 disc.

Since it uses existing manufacturing technologies, red laser could be employed into the consumer market by the end of 2003, according to Richard Doherty, director of research for the Envisioneering Group, a consumer electronics consulting firm based in Seaford, N.Y.

That would be beneficial to Warner, which owns not only a huge DVD manufacturing operation, but also numerous patents related to that industrial process.

"Warner is clearly the biggest advocate of red laser," said Doherty. "Warner has a proprietary interest in the existing DVD machinery continuing for decades."

According to Doherty, unlike those talks surrounding the adoption of DVD, early discussions between the studios about an HD disc have been civil. "They're all trying to not make this as oppositional as the DVD wars," he said. However, although it hasn't encountered harsh opposition yet, he said Warner could face a tough road in getting all of its competitors on board specifically with red laser.

Fox, for example, has already indicated its support for D-VHS. However, sources said the studio is showing early signs of supporting Warner's leanings, at least verbally.

Meanwhile, Doherty said, Columbia TriStar Home Entertainment is likely to support the Blu-ray Disc standard, an entirely new optical media technology endorsed by the supplier's parent company, Sony Corp. Sony, along with Philips Electronics, was a fierce early competitor in the DVD format wars with Toshiba Corp. and a consortium of other consumer electronics companies backed by Warner before all sides eventually worked out a hard-fought hybrid platform that is the current DVD.

Indeed, Blu-ray, which requires an entirely new manufacturing process, is the optical-disc technology favored by the majority of the consumer electronics companies that occupy the DVD Forum.

Able to hold six times the data of a traditional DVD, Blu-ray is capable of well beyond the 19.3 MB-per-second bit rate the Federal Communications Commission has established as the minimum for HD broadcast; a benchmark red laser falls well below.

"Clearly, the Warner argument is that we can get red laser to the market faster," Doherty said. "But some of the other studios have wondered if using this approach could result in a loss of picture quality that would upset artists and directors. Those developing the red-laser compression algorithms say, 'We can get a pretty good picture with a bit rate of 5 MB.' Well, the question is, how good is 'pretty good?'"

Thoughts? Of course, copy protection is the largest issue. I think this will definitely up the marketability of HDTV's, in addition to broadcast HDTV programming. Unfortunately, market penetration will definitely take a few years, since the prices will most likely be real expensive from the get-go. HD-VHS players are still in the $1000+ range.

[amerlop]

Hmmm...I thought DVHS had a lot of potential...it's too bad that this format will eventually come out on top (if you can call it that). I just don't think that HD-DVD's will get enough market saturation to really be popular though it may still be profitable. Too people have complained about HDTV and the DVD switch...it is too soon to see any sort of format change for at least 5-7 years. It will be a niche format like SACD that movie buffs will buy into (which is fine since I will probably buy into it).

[Tones]

If I had an HDTV, I would definitely get DVHS. Recording HDTV = awesome, and it's nice to finally see use of firewire within home theater.

[amerlop]

Well, I would have to see which format gets the most support...but I could always consider a DVHS as a really expensive replacement for an already existing part of my home theatre (it still playback and records VHS and SVHS)

[MrKasualUltra2000]

sounds cool....now if i can find an HDTv for 400 bucks.