Gear: $50 For Free From Amazon

Ok, let me get this straight:

1. I bought an HD-DVD player from Amazon in November when the format was alive and reasonably healthy, but knowing full-well that the format could die.
   
2. The format died and now I can get tons and tons of HD movies for incredibly cheap prices.
   
3. I'm perfectly ok with this.
4. For all this "heartache," Amazon wants to give me $50, for free!

If you figure that the $50 credit from Amazon will buy about four HD-DVDs, the $199 I spent got me a perfectly functional HD-DVD player and 14 free movies. Or maybe I got 14 movies for $199 and a free HD-DVD player. What some people may think of as a very stupid purchase looks just dandy to me!

Gear: The Last Domino Falls

And just like that, it's all over.

On Tuesday, almost immediately after Toshiba announced they would be quitting the HD-DVD business, Universal announced it was switching to Blu-ray. This morning, Paramount formally announced what everyone knew was coming: they would also be switching back to Blu-ray production (they were initially format neutral, releasing movies on both formats). With almost no hardware support and zero major studio support, HD-DVD is now dead. Only LG has committed to continue HD-DVD hardware production. Even then, their support will be in the form of their dual-format player, with the idea being that they can transition HD-DVD supporters over to Blu-ray with a player that will play their existing HD-DVD collection.

I initially thought that both formats had lined up enough support that format duality was inevitable. Of course, I didn't account for the possibility that Warner would switch to Blu-ray exclusivity, a move that exposed how tenuous the balance between the formats was. I'm pretty shocked at how quickly HD-DVD fell; it took just 48 days from Warner's announcement for HD-DVD to completely die.

Of course, Blu-ray as the standard is not necessarily a win for consumers. "Standard" can also be likened to monopoly, where there isn't the downward pressure on prices from marketplace competition. The player side will continue to see competition and price drops, though without HD-DVD in the picture, it will likely be at a significantly slower pace than we've seen over the last year. On the other hand, each movie is its own little monopoly and my guess is that we're not likely to see the cost of Blu-ray movies drop noticeably for quite a while. It took several years for DVDs to drop and we're likely to see the same thing here.

Gear: Goodbye HD-DVD

It's officially official: as of March 31st, 2008 -- almost exactly two years after the format was released in Japan -- HD-DVD will be no more. Toshiba has decided to pull out of the business, effectively killing the format. They'll begin limiting shipments of HD-DVD hardware at the beginning of March and cease production by the end of that month.

Time for me to start scouring the internet for people and business trying to firesale their HD-DVDs. I plan to take advantage!

Gear: The End is Near

HD-DVD is a rapidly sinking ship. I reported earlier today that Best Buy and Wal-Mart were both lining up behind Blu-ray. Now, in what is likely the final bell in the format war, rumors are swirling that Toshiba is preparing to formally drop HD-DVD. Without a large hardware manufacturer supporting the format, the remaining HD-DVD exclusive studios, Universal and Paramount, are sure to jump to Blu-ray soon.

HD-DVD is dead. Long live Blu-ray!

(And from a consumer perspective, thank god!)

Gear: Netflix Goes Blu

In another knock against HD-DVD, Netflix has decided to exclusively back Blu-ray. Frankly, this makes no sense. I can almost understand the retailer mindset that their shelf space is finite and they'd rather stock their shelves with a product that moves faster. But Netflix operates out of warehouses! Are we really to believe that by not stocking HD-DVDs, they're going to use that space for something else?

On the other hand, you could argue that Netflix is simply trying to hasten the end of the format war. But do they really think their choice is going to be the knock-out blow against HD-DVD? And do they really have that much to gain by ending the format war? On a per-movie-rental basis, they don't make any more money renting hi-def movies. In fact, they probably make less, as the initial purchase price of a hi-def movie is higher than standard DVD.

As a current Netflix subscriber who rents both Blu-ray and HD-DVD movies, I find this quote curious:

"From the Netflix perspective, focusing on one format will enable us to create the best experience for subscribers," the company said, adding that not many customers order high-def DVDs.

I fail to see how NOT offering the movies that some people might want to rent will create the best experience for their subscribers. Netflix' real power is in their ability to stock and ship anything that you might want to rent. Traditional rental stores can't touch this kind of selection. Now Netflix is actively working to limit the selection of movies they offer? That doesn't make any sense.

I'm going to seriously consider switching to Blockbuster because of this decision. While Blockbuster exclusively stocks Blu-ray in their stores -- where the limited shelf space argument comes into play -- their online/mailing service still offers HD-DVDs in addition to Blu-ray.

UPDATE (2:20pm): Further reading shows that Netflix is planning to phase out HD-DVD by the end of 2008. No need to jump to Blockbuster just yet. By the end of 2008, HD-DVD may be completely dead and this decision by Netflix will be moot.

Gear: HD Format War Update

The HD movie world is very much in flux after the recent announcement that Warner Bros. would move from HD format neutrality to Blu-ray exclusivity. A quick rundown on the news of the last week:

• HBO and New Line Cinema follow Warner to Blu-ray exclusivity. (This was not unexpected given that these are sister studios to Warner and also distributed by Warner.)
• BBC Home Video, despite also being a sister studio to Warner, announces that they will continue to be format neutral, citing stronger sales of their Planet Earth series on HD-DVD.
• Rumors swirl early last week that Paramount is interested in exercising an escape clause in their HD-DVD exclusivity agreement to switch to Blu-ray. The clause reportedly allows Paramount to back out in the event that a major studio switches to Blu-ray exclusivity.
  
• Further rumors indicate Universal's exclusivity agreement with HD-DVD will expire shortly and they are considering a switch to Blu-ray.
  
• Both Paramount and Universal publicly state their on-going support for the HD-DVD format.
  
• Toshiba slashes the MSRP on their HD-DVD players. Street price for their entry-level, 1080i HD-A3 is now as low as $127, while the step-up, 1080p HD-A30 can be had for $164.
  

For now, HD-DVD is still standing. But things are looking increasingly desperate, and even the slightest bad news could be the final bell for HD-DVD. Paramount and Universal were hardly forceful in their public support of HD-DVD and nothing prevents them from backing out in the future. At this point, perception is reality. If people perceive HD-DVD to be dead, they won't buy and the format will be dead.

Gear: The Beginning of the End for HD-DVD?

The big news in the HD movie format war is that Warner Brothers has chosen to release movies exclusively in the Blu-ray format. They expect to complete the transition by May 2008. This appears to be more of a loss for HD-DVD than a gain for Blu-ray as Warner had previously been releasing movies in both the Blu-ray and HD-DVD formats, the last major studio to do so.

Admittedly, my assertion that both formats would continue to exist now has very little possibility of happening. While HD-DVD still maintains a significant lead in the cost of players, from a content perspective, the format war has moved from a 5-to-3 studio lead for Blu-ray to a 5-to-2 lead. Without Warner Bro., it seems impossible that HD-DVD can continue to produce content at a similar rate to Blu-ray. A cash infusion to induce a flood of catalog releases by the remaining two HD-DVD exclusives could keep them competitive for awhile, but they simply won't be able to compete on the new releases front. Further, the handful of movies released by Warner exclusively on HD-DVD because of interactive features available on HD-DVD players (such as Batman Begins and The Matrix trilogy) will move to Blu-ray in May.

I have a soft spot in my heart for HD-DVD because their cheaper player price allowed me to enter the market last Christmas. I recently bought a Toshiba HD-A3 player so that I could more easily play my HD-DVD collection. However, I have to admit that the Christmas sales on players and movies also moved me to purchase a Blu-ray player. My early December purchase of a Samsung BD-P1400 Blu-ray player now seems prescient in light of Warner's decision. I would be lying if I said I saw this coming, but this possibility was definitely in the back of my mind when I made the purchase. At least I'm now future-proofed.

Gear: The HD Format War (continued)

The Toshiba HD-A3 arrived earlier this week and I promised I was going to write about my experience with it. Unfortunately, the installation of the player was so simple, I don't have much to write. I plugged it in, connected it by HDMI cable to my HDTV and it plays all my discs perfectly at 1080i. A perfectly seamless process, unlike most electronics installations these days. Honestly, I wish I had gotten a player sooner. The headaches with playing HD-DVDs on my HTPC were really not worth it, though I did end up with a much lower price and a boat-load of free HD-DVDs.

Instead, here's some more about the HD format war. With the Christmas shopping season on, things are certainly heating up. Word is that Toshiba sold 90k HD-DVD players during the week that the Toshiba HD-A2s went on sale for $98 at Best Buy and Wal-Mart. Good news for them, but HD-DVD still has a smaller installed base compared to Blu-ray when PS3s being used to watch Blu-ray movies are factored in. The entry level Sony player (BDP-S300) is still selling for about twice the Toshiba HD-A3, so we'll how sales go through the holiday season. Toshiba seems well aware that this time is crucial for HD-DVD.

Disc sales numbers for the week including Black Friday are now in, showing an almost 3-to-1 advantage for Blu-ray, up from 2-to-1 in recent months. At first glance, this might seem odd with jump in HD-DVD player sales, but it's pretty likely that a large number of those players were bought as Christmas gifts. The bump in Blu-ray sales could also be explained by high sales of new releases. January disc sales numbers should prove telling.

In any case, I still hold firm to my belief that both formats will live on. Sony CEO Howard Stringer seems to share my view, having recently said he believes the war will end in a stalemate. Naturally, he quickly backpedaled from that position, but the fact that the head of the company arguably winning the war even hinted that we'll end up with a stalemate is pretty interesting.

Gear: Toshiba HD-A3

I cracked.

I'm not proud to say it, but I've given up on my HD-DVD-on-HTPC experiment. It was fun for a while, getting HD-DVDs to play on the cheap -- Xbox360 HD-DVD drive connected to the HTPC, playing the discs with PowerDVD and output to the HDTV through HDMI -- but sometimes klugey is just klugey and you have to move on.

Things were fine with all discs through the first half of this year, but recently I've been having more and more problems playing HD-DVD rentals from Netflix. Fortunately, I was always able to make them work and I happen to enjoy working through those kind of problems. That is, until Transformers arrived. Whatever they did with that disc simply doesn't like my setup and I was never able to make it work. That seriously pissed me off, since I'm almost sure it has to do with some new quirk of HD-DVD Digital Rights Management (DRM). Goddamn corporations making it so legitimate hardware owners can't view legitimate content...ugh....that's a diatribe for another time.

Anyway, since it finally failed me I've decided I'm sick of futzing around with this setup and it's time for a dedicated set-top box. A couple Fridays ago, Wal-Mart and Best Buy both put the entry-level Toshiba HD-A2 on sale for just $98, apparently trying to move stock to make room for the new HD-A3. Unfortunately, I didn't know about it until it was over. Some other online stores had left-overs in the days after that sale at prices only a little above $98 and I tried grabbing one. They ended up running out of stock as well. Oh well.

Last Wednesday, I received an email from Amazon advertising the HD-A3 for $197 with 10 free HD-DVDs and I jumped on it. Word is that the player is basically the same as the HD-A2, just a refresh of some of the internal components to cut production costs. It differs from the higher end models primarily in that it only outputs video at 1080i as opposed to 1080p. My HDTV is only 1080i, so that's no problem for me. The 10 free discs includes the two in the HD-A3 box (300 and The Bourne Identity), 3 immediately free from Amazon (from a selection of about 15), and the on-going Toshiba promotion for 5 free with a mail-in rebate. Seemed too good to pass up so I went with it.

It should be here sometime this week and I'll have another post talking about my experience with my new toy.

Gear: The HD Format War (plus: An Affordable Blu-ray Drive?)

(Note: I assume most people interested in this post already already have a basic understanding of the Blu-ray and HD-DVD formats. If not, I recommend checking out this wikipedia page on the topic.)

A lot has been written in the media about the HD format "war." I have to admit, talking about it right now is a little silly in the first place. Frankly, sales aren't going to reach anything near DVD for a long time for one simple reason: without an HDTV, the next-gen formats are useless. While HDTV sales are booming and prices dropping, market penetration simply isn't there yet (latest numbers are around 30% of US households). This is in contrast to DVD -- the day DVD came out, every household in the US with a TV was capable of using it. Your plain old TV was all you needed to enjoy the dramatically improved picture quality.

I had to laugh when Paramount recently gushed about achieving 190k sales of The Transformers on HD-DVD during its first week. That number is relatively impressive for HD movie sales, but it was obliterated by DVD sales of 8.5 million.

People frequently cite the $200/player price-point as the magical point where everyone will suddenly go out and buy a next-gen player. This belief is based on rapid DVD adoption once player prices dropped to that point. What's being glossed over is the fact that, for a lot of people, the price is $200 plus the cost of an HDTV, which still sets you back a minimum of about $500.

All of that aside, I have a blog and I want to talk about the HD format war! My hypothesis: both formats will be with us for a long time. I have three reasons to believe this:

• The manufacturers and content producers are too entrenched: Sony and its 3 exclusive movie studios aren't backing down from Blu-ray anytime soon. In particular, Sony uses Blu-ray as its PS3 games format, so at the very least, the format will continue to exist for that use. Microsoft and Toshiba, the major backers of HD-DVD, certainly aren't backing down either, having recently added Paramount Studios as a second exclusive movie studio.
• There's an installed base: as I said, the numbers aren't large, but people (including me) have jumped on board and picked a side, or perhaps both sides. The installed base of users will require support in some form.
• The formats have identical dimensions: when discussing the HD format war, the commonly cited format war is Betamax vs. VHS, which VHS obviously won despite being the technically inferior format. Those media formats weren't physically compatible -- you couldn't put a Betamax tape into a VHS player or vice-versa -- but the two HD formats are perfectly compatible, being the exact same size as a DVD or CD. That, combined with the fact that the decoding process for both formats is virtually identical, means the only thing you really need in order to make a dual-format player is duplicate lasers and pickups to actually read the 1's and 0's off the different discs. A handful already exist.

I think the future is those dual-format players. In 5 years, I expect that you'll go buy an HD movie and not even think about the format of the disc -- your dual-format player at home will take care of it all for you. For now, those players are a bit cost prohibitive, though. You can buy the entry-level player for each format for less than the cost of a dual-format player.

All of this gets me back to my original point in creating this post. Since I believe both formats are going to continue to exist and I only have an HD-DVD drive for my HTPC, I'd like to be able to watch any new HD movie that comes out, not just those on HD-DVD. That means I need a Blu-ray drive for my computer.

Unfortunately, Blu-ray drives are quite expensive and there isn't much selection. In fact, if you want a drive that just reads Blu-ray discs (no burning) you only have one choice: the Pioneer BDC-202, which sets you back $260. At this point, there's no reason a bare Blu-ray drive should cost that much and there's no reason there should only be one player on the market (that second point probably drives the first). The HD-DVD equivalent, the Xbox 360 HD-DVD drive, only costs $180 these days and comes with 5 free HD-DVDs.

One of these days, I'll jump on board with Blu-ray as well, but its selection and price has to become more competitive before I do.