Disk war rumbles on

The war between competing the next generation DVD formats – the Toshiba driven HD-DVD and the Sony driven Blu-ray – is unlikely to be resolved until Sony’s PlayStation 3 (PS3) reaches the High Street in volume. Even then, it is still possible that consumers may not have to endure its serious effects for long. CES in Las Vegas saw plenty of predictable bluster from both camps, with echoes of how pornography helped swing the balance in favour of VHS against Sony’s Betamax video tape format. LG Electronics’ much heralded unveiling of a dual HD-DVD/BD player proved something of a damp squib. With a retail price of $1200, the box costs more than buying both Toshiba’s entry level HD player already on sale and a PS3. However, there was at least something underlying the LG announcement: dual format players can be made. The big question is how quickly will LG and others implement cost reduction programs. Contacted after CES, a senior executive at one of the major Silicon Valley reference design suppliers said he remained ‘very confident’ of delivering a dual format kit before the end of 2007 for players it expects to initially sell at a unit cost of $300 to $400. “From there, you can realistically look at $200 within a year and the market will then take off,” he added. Finally, there is the undeniable importance in the US of the PS3. Whilst its price tag of $500 may not make Blu-ray a mass market format, the more salient issue may concern how Microsoft responds to the competing console’s true arrival. Having completed a number of cost reductions to the Xbox 360 while waiting for the PS3 to arrive, Microsoft is said to be set to slash the cost of its hardware, just as Sony looks to start ramping PS3 sales volumes. And at that time, the HD-DVD plug in for the 360 will become widely available.