State of HD Disc War

Engadget just posted a nice wrap-up of their CEDIA coverage. (I was not able to attend CEDIA; after Nokia's big London event last week, I went to RIM and Motorola events this week and even had to follow the Apple announcements from afar due to scheduling). The big news both at CEDIA and in the press last month is around the HD-DVD Blu-ray war; HD-DVD gained a studio just when it appeared Blu-ray was pulling away with software sales, and both Samsung and LG have new dual-format players coming to market demonstrated at the show.

Back in January at CES, I attended the launch of LG's first dual-format player, and it looked like it might assuage early adopters fears about getting into the market. Certainly, the new players, which support even more features of both formats, are welcome. However, with the software schism, prospects for success for either format have gotten much worse. The only way a HD disc format could succeed is if it brought new experiences to consumers along with overwhelming industry support.

With some content available only on one format and some on another, consumers are understandably gun-shy. So industry support is certainly far from overwhelming. But a more fundamental problem is why anyone beyond videophiles should care about either HD-DVD or Blu-ray.

(For a videophile, higher resolution is reason enough to embrace a new format. I've bought and re-bought DVDs several times just to get versions enhanced for 16x9 TVs and better transfers. I am decidely NOT normal. The problem is, there aren't enough videophiles out there to make a mass market. Normal people need clear reasons to move to something new, and upsampled DVDs look pretty good.)

The last transition brought a lot more than just better looking video. The move from VHS to DVD brought:

• noticeably better video on even the least expensive displays - VHS is downright fuzzy
• slightly improved sound with even a basic setup, greatly improved sound when combined with an inexpensive 6 speaker Dolby Digital HTIB setup, and excellent sound with better equipment/room setup
• longer lasting physical media
• smaller physical media and packaging
• a complete shift in industry pricing practices from business rental (where VHS movies cost $75 - $150) to consumer purchase (where DVDs started out at $20 - $30 and quickly dropped to $8 - $20)
• no rewinding
• random track access
• extras such as director's commentaries, deleted scenes, and related video material
• multiple language tracks and subtitles

The move from DVD to either HD format is basically the DVD experience, plus:

• improved video; this ranges from obvious improvement over upsampled DVD to none at all depending on the content, the display, and the setup/environment.
• the potential for a further improved audio experience; right now this potential is limited to high end systems and is further limited by available content, hardware selection, and setup
• the potential for interactivity, however, I have yet to see a compelling use of this technology. Keep in mind that DVD offered it's own promising features that never amounted to much - remember "multi-angle?"
• higher priced content

I made these points back when the formats were first announced, but it's worth repeating now. Neither format offers average consumers enough to get excited about. If the PS3, which includes a good Blu-ray player as part of the package, had been a smash hit AND content providers all lined up to support the format, it might have had a shot at replacing DVD by default. But the PS3 has struggled out of the gate and is getting trounced by Nintendo's Wii, which cannot play movies at all. Wal~Mart will be offering inexpensive HD-DVD players this Christmas, but if the content question is still in doubt (and titles are more expensive than DVDs), free players would not make much of a difference.

Consumers are moving to random access media. A strong case could be made for a new format that brought HD video resolution to a media server where it could be queued up at will from a visual menu, seamlessly distributed around the house, moved to portable/phone/car -based systems, and sliced and diced for instant access to greatest hits scenes (like a typical spliced-together YouTube video). This would be a significant improvement for consumers who today must load individual discs from racks of DVDs or download movies from iTunes to watch on a single PC or iPod touch. Of course, content owners won't let this happen -- they can't even get out of their own way with HD DVD/Blu-ray. But if Hollywood doesn't create and monetize a system like this themselves, consumers will eventually piece something like it together on their own with pirated/downloaded content and/or content ripped from DVDs. Sure, the video quality won't be as good, but video quality alone isn't enough to get consumers move to a new format - or keep them from moving to different format, either.

-avi

Comments

[Alan Hutchinson]

I agree that going from vhs to dvd was a huge jump and dvd to hd dvd is a smaller jump however in my personal opinion there are more people out there than you think that want higher quality video ie going from 480p to 1080p is a big jump and that consumers put more emphasis on video quality and they really don't care about audio quality. Audio is about convenience and video is about quality.
Home theater hobbyists want high quality video and they have the displays in their homes, it's the format war that's slowing it down. If it were one format and it cost 199 they would sell like crazy. I believe hd dvd is a bigger leap than you think with consumers.

[Avi Greengart]

Alan,

Oh, how I wish I could agree with you, but... you're wrong. I've discussed in the past surveys that showed 50% of HDTV owners don't have an HDTV source, and that 25% of HDTV owners think that they're watching HDTV when they actually just have standard definition. In other words, 25% of people who bought an HDTV and are watching DVDs or standard cable feeds think that's so good that it's already HD (http://hometheaterview.typepad.com/hometheaterview/2007/02/50_of_hdtv_owne.html). Also, I can't tell you how many HD sets I've seen where the aspect ratio is completely wrong and the homeowner *never noticed*.

I do belive that the addressable videophile market is larger today than the laserdisc market was back in the early 1990's - home theater as a hobby has grown, it's far more accessible from a products/packaging/budget standpoint, and some women have been drawn into the fold, too (not nearly enough, but that's the subject of a different column). But I can't agree with your statement that, "audio is about convenience, and video is about quality." For most consumers, audio is about convenience and video is about... some other version of convenience (a big picture, a flat panel that doesn't overpower my living room). The promise of a better picture definitely plays into it as well, but even without a format war, a high def disc format would have a tough time displacing DVD.

-avi