The Pricing Strategy
In the vital area of picture quality, both formats also have a difficult time differentiating between one another. "Either format can produce a very good image," says Richard Dean, director of technical business development at THX Inc. "To me, it boils down to the price of the equipment and the availability of content."
Dean, who has helped master the DVD releases of the Star Wars trilogy and other blockbuster movies, says that consumers won't notice any real quality difference between the formats. But he says HD-DVD may end up with an advantage if it can under price Blu-Ray discs and players. "I think that's going to play a very large role." As for Blu-Ray's greater storage capacity, "more space is always an advantage," Dean says, "but the question is how much more space is really needed." Notes Parsons: "If you start doing HD bonus features, it will suck up capacity very quickly."
Intel executives, who first got involved in the working groups for next-generation DVD formats to help avoid a format war, already are bracing for an era of consumer confusion as a Blu-Ray-vs.-HD-DVD scenario takes shape. "We didn't want two formats coming out," says Balogh. "Now we have an even standoff, so neither side wants to compromise whatsoever." Making matters worse, he says, the entertainment studios also are split between Blu-Ray and HD-DVD, although more big studios have backed HD-DVD at this point.
"The studios will be the kingmakers here," he says. Ultimately, consumers may struggle to figure out what kind of players and media to purchase during the next couple of years. "The most important benefit to the consumer is that the HD-DVD players that we'll be introducing to the market this year will be fully backward compatible with the current DVDs that are already in consumers' homes. With the Blu-Ray formats' backward compatibility isn't so simple," adds Sally.
Still, many are wary. "It would be best if we went to market without two formats," says Panasonic's Doherty. "We're very disappointed that we're in a format war." As the battle heats up in 2005 and well into 2006, consumers will decide which format will succeed.