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Early Market Entry Key in High-Definition DVD Battle
Sep 30, 2004
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Access to large entertainment libraries and first-to-market advantage will determine the outcome of the contest between competing high-definition DVD alliances, says a new study from ABI Research. The contest will be joined in earnest by mid-2005, according to Vamsi Sistla, the company's director of Residential Entertainment Technologies.

Sony's recently announced purchase of MGM -- including more than 9,000 movies in the MGM catalog -- has refocused attention on content ownership in the struggle for the next-generation DVD market, ABI reports. The rival HD-DVD group can already claim Warner Video, 20th Century Fox, and Disney among its content providers.

The two camps hoping to become the de facto standard for the high-capacity DVDs of the near future -- Sony and Matsushita with their "Blu-ray" technology and the HD-DVD group of Toshiba, NEC, and others -- compete on both technical and commercial grounds.

With players already released, Sony was first to market. However, Sanyo recently announced its intention to build HD-DVD players. "In the longer term," Sistla believes, "vendors offering dual-standard players may be the biggest winners, and in the short term, early adopters might get shut out from the content on the competing format."

Initially, Blu-ray disks held more gigabytes than HD-DVD disks, the research firm reports. However, with their more efficient MPEG4 compression, HD-DVDs could store longer movies. Sony recently leapfrogged by adopting MPEG4 too, and next month will announce plans for much larger 200 MB disks. But Blu-ray disks require completely new manufacturing plant, while HD-DVDs, more similar to today's DVDs, will be cheaper to manufacture, ABI says.

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