Sony CEO sees ‘stalemate’ in disc fight (1 Viewer)

[London Lawson]

Originally Posted by MSNBC
NEW YORK - The head of Sony Corp., Howard Stringer, said Thursday that the Blu-ray disc format the company has developed as the successor to the DVD is in a "stalemate" with the competing HD DVD format, chiefly backed by Toshiba Corp. and Microsoft Corp.

(MSNBC.com is a Microsoft - NBC-Universal joint venture.)

"It's a difficult fight," said Stringer, speaking at the 92nd Street Y cultural center in Manhattan.

Toshiba has been selling its players for as low as $200 heading into the holiday season, while Blu-ray players cost more than twice as much.

The HD DVD camp also scored a significant win in August, when it induced Paramount Pictures to drop most of its support for Blu-ray and put out high-definition movies exclusively on HD DVD.

"We were trying to win on the merits, which we were doing for a while, until Paramount changed sides," Stringer said.

At the same time, he played down the importance of the battle, saying it was mostly a matter of prestige whose format wins out in the end.

"It doesn't mean as much as all that," Stringer said. He added that he believed there was an opportunity of uniting the two camps under one format before he became CEO, and he wishes he could travel back in time to make that happen.

Stringer was more upbeat about the PlayStation 3, the game console that has so far had disappointing sales compared to the rival Nintendo Wii.

The CEO said the console is the best-selling console in Europe after a price cut three weeks ago. In the U.S., a recent price cut has doubled sales.

"We are coming back up again," Stringer said. The company aims to sell 10 million PS3s by the end of its fiscal year in March. Nintendo has already sold 13.2 million Wiis.

 

[Ronald Epstein]

Yuh know, I wish we could go back in time.

I have never had any sympathy for either side because
the studios brought this all on themselves. This war has
been all about studio greed and a desire to repeat Warner's
success with DVD by being able to reap all the royalties.

The really sad fact here was that there was never any
consideration for the end consumer.

Yeah, it would have been nice if both sides could have sat
down and agreed to split the royalties and come up with a
unified format. It would have prevented the loss of millions
of dollars that was thrown into just fighting this war in the
first place. Furthermore, we would have far more consumers
looking to open their wallets this holiday season to buy a HD
player rather than having to sit out another year out of sheer
disgust.

What's even more unfortunate is that both these formats are
not going to be able to continue coexisting together. ONE format
will have to prevail as some studios will not want to have to
produce 3 different skews of product (HD-DVD/Blu-ray/DVD).
That means that there are many of us who have invested in a
format that will eventually go belly-up.

Fortunately, this war has escalated price reductions on players
making it far easier for early adopters to own both. By the
time one format fails, there will be combi-players at affordable
price levels assuring compatibility for any HD title you invested
your dollars towards.

 

[Aaron Silverman]

I don't know about that. I still see the potential for an SACD/ DVD-Audio style co-existence, followed by a general move in the direction of downloads (Microsoft's dream outcome).

Both sides have invested too much in their chosen format to give up anytime soon. Especially considering that they will probably move on to focus on the next format (download/ streaming) pretty quickly. And with prices coming down so fast, decent combo players will probably be under $200 by next holiday season. With enough people having both formats in their homes, there really won't be any incentive for studios to switch formats. Even Warner has been hinting that they'll drop one format, but I can see the studios continuing to produce DVDs plus one HD format each.

Or maybe I'm just trying to justify to myself keeping that $98 HD-A2. . .

 

[London Lawson]

I don't care who wins either way. But I bet the people who bought the first, and ridiculously over-priced players do!

 

[Paul Arnette]

I'm so over this format war. I've given up on the idea of a unified format, or even a clear winner anytime soon. In fact, I don't really have much of a preference between either format anymore, other than the fact that I really, really, really like Blu-ray Disc's anti-scratch coating, and I don't like the Combo Format. If that doesn't underscore the ridiculousness of this war, I don't know what does.

 

[Jason Seaver]

Speaking for myself, I've gotten value for money by having HD-DVD for a year before player prices went absolutely nutty.

 

[bigluigi]

Interesting.....you know I read the Sony CEO's comments as almost a concession speech that HD-DVD has the clear price advantage which the BDA will never be able to overcome. The future thrust for Sony down the road will be centered about gaming and their PS3 machine.
I mean, lets face it, the only way the BDA was going to win this format war was to destroy the HD-DVD format from the get-go. The BDA knows that the longer the format war continues the more favorable it becomes for the HD-DVD camp because of it's lower pricing potential.
Years, or perhaps even months down the road, tech historians may conclude that this format war was a positive event in that it escalated the lowering of prices and mass public acceptance much faster than what would have occurred had there been no format war. There's just no substitute for COMPETITION!

 

[Patrick_S]

I know in many circles Microsoft is the whipping boy for all that is evil but the reality is that downloading is the dream outcome for all content providers.

Downloaded content will be drastically cheaper for the content providers to produce and of course none of the savings will be passed along to the consumer.

 

[Chris Maynard]

Talk about spoiled children.

I used to pay well over $1,000 for a laserdisc player. Laserdiscs were $40 - $150 each!

I paid over $650 for my first DVD player.

 

[Brian-W]

Thing is DVD-Audio is essentially dead (along with DualDisc)...SACD is chugging along, but not at the level it once was (now relegated mostly to classical and jazz).

SACD more-or-less 'won' the audio war (if you can call it that), but SACD is just treading water at this point. I don't think this war will go that way, but certainly isn't getting any better at this point either.

 

[bigluigi]

Yes...but I'll bet you got wiser over the years and was first in line for that $98 HD player last week.

 

[Chuck Anstey]

There are two reasonable ways to take this statement.
1. There was a chance for a unified format but as soon as Stringer became CEO, he killed it and started the format war.
2. The format war was already started before he become CEO but there was a chance of a unified format before the war started.

Which is it?

 

[Grant H]

I don't see how competition helped hardware much at all (well maybe on the HD DVD side since they keep pushing that one advantage). DVD player prices fell at the same rate as Blu-ray players are falling now. Competition DID help the software, though, in that it forced Blu-ray to move to superior codes and PQ faster. That's the one thing we can be glad about.

For Toshiba it isn't competition, but dumping for which there is no substitute. There's NO competition between HD DVD player manufacturers, just heavy subsidizing by the company that invented the format. Or if they're not subsidizing they just had the resources from all the DVD money to crank out a tremendous number of players so the cost per unit would be low, something no other CE company could do.

 

[ReggieW]

I really believe that Stringer probably thought that the PS3 would've landed them a swift & decisive victory not long after it's launch. Nonetheless, It's definitely refreshing to see a power player from either side expressing some regret for this mess, so kudos to Stringer. I'm assuming that it's now too late to unify both formats since both camps are now well dug in with their own exclusives, contracts & tech development.

One thing is certain....once this format conflict is all done with, it's story would certainly make for one hell of an interesting documentary someday!

 

[Lyle_JP]

Is there a particular reason that software plays absolutely no part in your analysis, despite the fact that it's arguably the deciding factor in virtually every format war (be it audio, video, or game) since the start of consumer electronics?

The biggest must-have sellers on home video since VHS have been produced by Disney. And they have rejected HD-DVD for its lack of robust copy protection, a situation that will not change since Toshiba is unwilling to consider revising any part of the format's specs.

Also, can anyone remember a time in history when a video format significantly supported by only one manufacturer actually won its format war?

I have nothing against HD-DVD. It seems like a solid format. But I just don't see it winning, for dozens of reasons that have been touched on. But some fans seem to be terribly myopic about their formats. I'm sorry, but it's about a lot more that just "cheap players". If cheap players was the only trick, Sony would have started giving blu-ray players away for free at the start.

Besides, are we looking for blu-ray or HD-DVD to be the replacement for DVD? The new mainstream? Or are we hoping for a niche format, catering to those of us who demand the best in picture and sound, and are willing to pay extra for it? I kinda hope for the latter. I wouldn't mind if either format became the laserdisc to DVD's VHS, as it were. Yes, that would mean on average that the discs would probably wind up costing $10-$15 more than their SD counterparts. That's not exactly highway robbery, particularly if great time and care are taken with each release, and it doesn't become the 100+ titles per week grind house that DVD has become.

 

[Patrick_S]

The Disney card is so over played.

Of course everyone’s experience might be different but I don't know one parent who has factored Disney's Blu-ray support into their HD decision.

The vast majority of Disney content is focused for children. The discs need to play in all of the household players, the portable players and the car systems and only SD satisfies all of those requirements. Also no of my friends have mentioned that their kids are demanding HD discs.

 

[Lyle_JP]

You don't really think that all those $100+ Disney CAV box sets were sold because "kids were demanding them", do you? Disney makes gobs of money off their adult fans, some of whom know no price boundaries when collecting something special produced by the mouse. And yes, their format decision directly influenced mine, and I'm not even a parent.

Besides, Disney was just an example of a critical studio which has rejected HD-DVD for technical reasons which are unlikely to ever be addressed to their satisfaction. Remember, Fox (home of the "holy trilogy") has taken a similar position. I find it more likely that both formats will die before Disney or Fox ever releases an HD-DVD. That is how deep the fear of HD pirating is to these studios.

 

[Aaron Silverman]

Guilty.

 

[Sanjay Gupta]

I think if I remember correctly, it was the second option. The war was already 'on', before Stringer took charge and by that time the two sides had gotten too far apart.

 

[Brian-W]

Not just Stringer/Sony, but most of the studios supporting BD. PS3 and the success of PS2 had a substantial influence in which format to support.