Toshiba announced yesterday that they are pulling out of the HD-DVD market. Toshiba really was the main force behind HD-DVD, with the exception of a couple of other makers of hybrid HD-DVD/Blu-ray products (such as LG), which were always way too expensive for mere mortals to purchase - even moreso than a single-format HD player.

The upside? The format war is over. Those of us who have upgraded their TV sets for HD now have a clear path for a better DVD format. Blu-ray prices will get cheaper this year, as more manufacturers will step in now that they won't be worried about losing their startup costs for entering into an uncertain market.

The downside? If you bought an HD-DVD player, you're up the creek without a paddle. That's been clear for about a month, though. This announcement wasn't a surprise yesterday.

Personally, I waited. But I expect that the player prices will get low enough this year that I'll jump. I wasn't an early adopter of DVD, either, but I didn't wait for the prices to go all the way down before going for it. I'm kind of a "middle" adopter in many ways.

What's interesting to me is how this compared with the VHS/Betamax war in the 80's. One of the things that the Blu-ray advocates touted all along was that Blu-ray was better. More storage. Probably others, but storage was the biggie. But Betamax was far superior to VHS. The quality of the video was undeniably better. The cassette size was smaller, and more reliable. My dad was an early adopter, and we grew up with a Betamax. But it turned out that price beat quality. VHS was cheaper than Betamax.

No so this time around. HD-DVD players were always cheaper than Blu-ray. The discs started out cheaper, but eventually that leveled out. If I had gambled on it, I would have gone with HD-DVD for two reasons - price, and the name. What kind of dumb name is Blu-ray, anyway?

But it turns out there was one factor I was neglecting - during the VHS/Betamax wars, there were no other alternatives. The only other thing you could do with your TV was watch TV over the airwaves or cable. So everybody wanted something, and as soon as they could get it. People were more motivated to move forward, even with the uncertainty of what would happen. They wanted to watch movies at home! They wanted to record TV!

With HD-DVD vs. Blu-ray, this was not an issue at all. Most people were perfectly content with DVD, and actually will still be quite content with DVD for years to come. Many people had access to content on demand through their cable provider (many with HD options). Many people had DVR functionality through the cable provider, media center systems, etc. There are simply so many ways to get content now, other than live TV. So most people, even those who really would have liked to do something, waited. In the end the adoption was driven not by price, but by quality expected by early adopters who were willing to fork over the cash.

The PlayStation 3 had a huge impact as well. If the HD-DVD had been standard in the XBox 360, that might have changed things a bit. But Microsoft chose to make it cheaper. So Microsoft is winning the console war, but Toshiba lost the HD disc war.

The biggest downside? With HD-DVD, you could put the HD-DVD on one side and put a regular vanilla DVD on the other. Nice compatibility. But if I buy a Blu-ray of "Cars" for my kids, they can't watch that in our DVD player in the car. I guess eventually there will be some software on the web to break the Blu-ray encryption and make a DVD backup of a Blu-ray disc, but you'd still rather not have to resort to those methods just to keep your kids quiet in the car.

But I'll take the tradeoff. The ability to step into full HD content without being worried about picking the losing format will be worth it.

Labels: tech