Blockbuster chooses Blu-ray: is the war over?
In a huge blow to Toshiba, Universal, and the rest of the HD DVD devotees, rental giant Blockbuster has decided to stock only Blu-ray discs in the vast majority of its nationwide locations, although HD DVD titles will continue to be offered online and in the 250 (out of 1,450) stores that have been testing both formats since last year. Blockbuster VP Matthew Smith revealed to the AP that the decision to go with Blu-ray -- which will reportedly be announced tomorrow -- stemmed from an overwhelming customer preference for those titles in the test markets, accounting for over 70% of all HD discs rented. Interestingly enough, it seems that content -- and not price -- was the deciding factor for consumers, with Blu-ray-only hits such as the Spiderman and Pirates of the Caribbean films apparently outmatching equivalent HD DVD exclusives. While it's still a little too soon to declare Blu-ray the outright winner, this Blockbuster decision only contributes to the momentum that Sony's darling has had of late -- momentum that at this point, might be too difficult for the other guys to counter.[Via AVS Forums, thanks Simple Panda]
Reader Comments (Page 1 of 2)
Jeff N. @ Jun 17th 2007 7:35PM
That is a big deal. A lot of people use Blockbuster for their DVD rentals. I would think Blu-ray feels really good today.
george @ Jun 18th 2007 1:20PM
Blockbuster is completely irrelevant and will be out of business within a couple of years-max!
Noone rents from them and guess what? They have a blue ray agenda!
Netflix is putting them out of business, and I have been renting HD DVDs for months!! I rarely BUY movies, but when I do..they are usually warner bros or Univeral movies anyway! Disney is the only downside for owning HDDVD. For those movies that my children watch, I just buy the regular dvd and let my toshiba HD player upconvert to 1080I!! Who cares about Sony movies anyway? They are the lowest on the totem pole in the way of content!
Space_Butler @ Jun 17th 2007 7:43PM
Check wikipedia. There are over 5,000 blockbuster locations, and only around 1500 are going to be "exclusively" supporting blu-ray. That's hardly the death knell that the original article would suggest.
TheGuy @ Jun 17th 2007 7:51PM
True, but it's another member of the video industry backing Blu-Ray. The more sales and greater industry support will compel even more members of the industry to back Blu-Ray. It'll continue in that cycle until Blu-Ray becomes the winner.
SimbaDogg @ Jun 17th 2007 8:04PM
This is quite possibly the biggest blow that HD-DVD could suffer, other than universal jumping ship...or microsoft suddenly decided to make a combo drive for the elite. But really, when people go into retail locations, which are usually the less techy of the populus (compared to those who do all their rentals online) their going to see that there aren't any hd-dvds offered...and maybe blockbuster is on the right track for a winner. i mean, if i were old, and not visiting engadget multiple times a day, this is certainly what i would be thinking. I can really see the execs over at sony, disney, fox, pioneer, philips, hitachi, samsung, panasonic, sharp, mitsubishi, lionsgate, java all breathing a sigh of relief. This might be the first nail in the coffin for Tosh, MS and universal. Well, all could things come to an end, it was fun why it last...
Angelo @ Jun 17th 2007 8:15PM
probably because of the PS3. May have been one of the few times in sony's existence they did something right with a competing format, shoehorn it into something way sought after and super popular.
Way to go Blockbuster.
Borat @ Jun 17th 2007 8:15PM
Just the fact that Spiderman and Pirates Of The Caribbean only appear on Blu-Ray is a big enough blow imo.
Also, let's not forget that Pixar movies only appear on Blu-Ray (Apple supports Blu-Ray as you all know).
If I had to choose one, I would definitely choose Blu-Ray.
Simple Panda @ Jun 17th 2007 8:45PM
You're welcome, EngadgetHD.
Evan Tribley @ Jun 17th 2007 9:40PM
I went to my blockbuster just a few days ago to see if they had any HD titles. When I asked they said no and they don't expect any anytime soon. I wonder if this means they are one of the 3500 stores not getting any HD titles.
I think it really would be a shame to see Blu ray and I am still holding out for the HD DVD's; but I am very pessimistic.
I really hope to see the HD DVD group pull together some major cash for one all out blitz to try to save the day. The prices for the equipment are becoming very reasonable and I still honestly believe the majority of the public doesn't even know there is a format war.
I really don't want to have to say Blu Ray for the next ten years either, what a terrible name.
Andrew @ Jun 17th 2007 9:46PM
Where is the press release ?? http://www.ap.org/pages/about/pressreleases/preleaseindex.html
Andrew @ Jun 17th 2007 10:08PM
same here http://www.blockbuster.com/corporate/newReleases
JohnDoe303 @ Jun 17th 2007 10:35PM
Great move Blockbuster! I'll be sure to stop by and check out the selection. Blu-ray FTW!
Doug @ Jun 17th 2007 10:35PM
"Check wikipedia. There are over 5,000 blockbuster locations, and only around 1500 are going to be "exclusively" supporting blu-ray. That's hardly the death knell that the original article would suggest."
Initially the 1500 are Blu, dont you think the rest will follow? They are not going to go back to HD-DVD after they only had 30% interest.
If you think any different you are a dilusional fanboy and im sorry. If you cant admit it im sorry.
Space_Butler @ Jun 17th 2007 11:00PM
"Initially the 1500 are Blu, dont you think the rest will follow? They are not going to go back to HD-DVD after they only had 30% interest. "
That still doesn't mean the 'vast majority' of stores, like was posted in the article. Who here is the "blind fanboy" that they dont want FACTUAL reporting? I feel sorry for you because you exist.
Rene @ Jun 17th 2007 10:45PM
Just another reason to keep renting from Netflix. Haven't set foot inside a Blockbuster store in more than 3 years. ::shrug::
Mike @ Jun 18th 2007 12:12PM
Blockbuster IS still renting HDDVD online..which can be traded at a store immediately if you don't want to wait for the mail to get your next movie. There are still a lot of good movies not in High Def to rent.
david @ Jun 19th 2007 12:40PM
Yup, I have BRD and I love netflix for letting me see a disc before I decide if I want it in my collection. I wouldn't say Blockbuster is irrelevant though. 5,000 stores and their own online service mean that they have a huge impact. I remember when I was an early adopter of DVD, I walked into Blockbuster and they didn't even know what a DVD was.
And to some of the guys happy with upconverting DVD players. I can see a significant difference between an upconverted DVD and a BRD (I'm sure HD DVD is the same). However, it's better than nothing.
Alex @ Jun 17th 2007 10:46PM
this is pretty surprising since Blockbuster is still struggling with Netflix and downloadable content. Good luck with the rotting discs Blockbuster, you can keep Dave too!
TheGuy @ Jun 17th 2007 10:52PM
Stop spreading lies. The "rotting disk" problem only affects a few batches of Blu-Ray disks due to a manufacturing defect. It's not a widespread problem, and has also affect a some early-produced CDs and DVDs.
Paul Fernandez @ Jun 17th 2007 10:54PM
Not to rain on anyone's parade, but I've had nothing but trouble renting discs from Blockbuster's stores or their website. In fact I've joined each twice and cancelled twice because they never seem to have the movies I want. It's tricky enough just trying to get new HD DVD releases from NetFlix, so it will be interesting to see what happens when everyone's clamoring for the hottest Blu-Ray titles that are suddenly out of stock.
I would refrain from any "death knell for HD DVD" rhetoric based on this announcement. Seriously, have you seen the lines at Blockbuster on Friday and Saturday nights? They're probably not going with HD DVD because they don't want the headaches or confusion from frustrated renters who may leave the store angry and empty-handed when they can't get "Breach" or "Spider-Man 3" on their format of choice. Save it for when Spielberg announces "Close Encounters" and "E.T." for HD DVD exclusively or something along those lines. Frankly, it's tiresome to keep hearing about this thing being "over" when it's only just begun.
unfiltered @ Jun 17th 2007 11:39PM
"Close Encounters" is a Columbia Pictures release. (See: Sony)
Besides, right around the time when the HD DVD Forum jumped the gun announcing a bunch "Spielberg" titles from Universal, he made them take down his movies off the release list. He also stated that he wouldn't give the studio his "OK" while a format war was going.
Asterra @ Jun 18th 2007 12:01AM
It doesn't matter. HD-DVD has already served its purpose: It forced Sony to use new codecs. Today, even though half of all releases are still mastered with MPEG2, this conspicuously does not happen with the big titles because there is too much prosumer spotlighting; they'd never get away with it.
Without the competition, Sony may well have stuck with MPEG2, leaving everyone scratching their heads wondering why "true 1080p" barely looks better than DVD regardless of the movie. And we'd probably never see a Fifth Element reissue. And most importantly, HD discs probably never would have taken off at all.
h0mi @ Jun 18th 2007 12:30AM
Online service will still carry HD-DVDs but this is not good news for the HD-DVD format.
I'm going to cancel my crutchfield order of the h2-a2 player.
Region Free HD @ Jun 18th 2007 12:51AM
Does this mean the war is over between BlockBuster and NetFlix, too?!
:p
TJ @ Jun 18th 2007 1:28AM
BD+ was designed so it can't brick your player. It disappears the minute you take a pirated disc out of the player.
HD DVD had DRM too. Crappy DRM, but DRM nonetheless.
Besides, its not like some enterprising boy genius won't figure out a workaround for BD+ 2 minutes after its released.
I'm about to try to Ebay my HD-A1. I no longer have any faith in the HD DVD format. It was great while it lasted, but I can get more movies (and better movies) on Blu-ray. I use my PS3 for movies 99% of the time, and my Toshiba gets used when I want to watch Serenity or King Kong, which is nowhere near as often as when I watch Pirates of the Caribbean or Superman Returns.
unfiltered @ Jun 18th 2007 2:14AM
Don't stir the pot, Dave. If this does have any lasting effect on HD DVD's lifespan, try and be a little graceful, would ya'?
freduk @ Jun 18th 2007 2:37AM
Everybody seems to forget europe, I know it's only as big or even more than the US, Blockbuster is renting both format in here (london) at the moment, I don't know if that will change, this format war is like paris hilton if we didn't care about it it would have no succes, I got a ps3 and a toshiba as I always say here I like HD DVD because of no region coding, and Blu-ray because of the studios they have I mean pirates, spiderman that's a must have. I would love an end to the war by the end of the year. But this Blockbuster move won't change much I think. With about 50 Blu-ray titles on the shelves (at most) here, I don't see how Blu-ray can make it. Dave? It's not a fanboy question because I'm not but if HD DVD wins what would you do? Anyway I hope we get a winner soon,
Kevin Murphy @ Jun 18th 2007 11:29AM
Good point about the UK. Region coding might not mean much to folks in the USA, but it's everything in the UK since US discs are so much cheaper. The rest of Europe is cut up by language, so region codes are immaterial, but they are very important in the UK. Especially since there's no PAL/NTSC difference anymore.
Jeff N. @ Jun 18th 2007 3:27AM
More has to happen for the format war to end. It's not going to happen as quickly as some would want. But certainly HD-DVD and Toshiba are NOT happy about Blockbuster doing this. If Netflix were to do it also, that would really be big news in the format war. Blu-ray can say the end is near when Universal decides to release their large catalog in Blu-ray format.
Kevin Murphy @ Jun 18th 2007 11:32AM
No reason for Netfix to do this, since it isn't a shelf-space or stocking issue. They stock SO many discs that it's no cost difference. And they'd lose HD DVD owners as customers instantly if they did that. I'll bet you houses that Blockbuster-by-mail still offers HD DVD and will continue to do so.
colinhunt @ Jun 18th 2007 4:37AM
Spider-Man, eh? In what alternative reality has that been released on Blu-ray, then?
freduk @ Jun 18th 2007 6:07AM
spiderman 3 will be on BD so is pirates 3.I'm not a fanboy I respect both formats but we have to see the good and the bad in each and the bad for HD DVD is the studios damn it, but that's why I got both, I'm just waiting for a good combo player.
Paul Fernandez @ Jun 18th 2007 7:38AM
The most interesting thing about this war is how people are defining "failure." Are HD DVD players and movies selling or not? Do Blu-Ray supporters wish they could see "Serenity" or "Transformers" on their format or not? Just because Blu-Ray appears to be ahead on a few charts, this question cannot be ignored, any more than the fact Universal doesn't appear ready to cave in to Blu-Ray.
Let's apply this to the PS3, which was nothing more than a trojan horse for this format. Whether it is or isn't being used in homes as a dedicated movie player, two things are certain: it's being soundly beaten by the Wii and 360 (which are cheaper alternatives); and many developers and games have migrated to the 360 due to cost and development issues. As a result, there's a dearth of games on the system that doesn't seem to be overcome anytime soon, and the buzz surrounding Halo 3, GTA IV, Mass Effect, and BioShock are NOT helping the situation.
So, is the PS3 a failure given these facts? Many people who own the system say no and blindly defend it and Blu-Ray because of their investment. Spider-Man 3 and Pirates 3 are inferior sequels that will not gross more than the first two movies did. Should these movies (and Shrek 3) be called failures as well? The point is, as long as consumers are snatching up players and movies for EITHER format, money is being made. From what I understand, money generated from purchased products equals succe$$.
The day studios and other companies realize this is the day I can buy the movie I want on any format I choose. Blockbuster is indeed short-sighted and won't realize their mistake until subscribers who want HD DVDs begin cancelling their store memberships and defecting to NetFlix or some other site. Like Glenn Close once said, "(We) will not be ignored!"
unfiltered @ Jun 18th 2007 5:25PM
You've got your studios mixed up again. Paramount handles Dreamworks domestic video releases, not Universal. So, when Transformers hits video, expect to see both HD DVD and Blu-ray, if both are still around.
WizarDru @ Jun 18th 2007 9:01AM
All I know is that I use Netflix and Blockbuster recently closed two of it's stores in my area. I'm sure the HD-DVD consortium isn't happy about this? How could they be? But at the moment, it's just another data point in a format war that few people are actively involved in. BD vs. HD-DVD is rapidly turning into a SACD vs. DVD-A war....in which no one cares who wins, because no one buys EITHER format, ultimately. I'm sure the PS3 means there is far more demand for BD than HD-DVD...but how big demand actually is would be the more relevant question.
And wanting BD to win simply because it would impact Microsoft is pretty deluded. Never mind the fact that Microsoft is the single least committed member to the technology, but this presumes that Sony is, in some way, different or more altruistic than Microsoft or any other large corporation that would like to dominate the industry. I mean, it's your money to spend as you wish, but if you think that HD-DVD's failure will register more than a blip on MS's radar, I think you're only fooling yourself.
Zack @ Jun 18th 2007 9:03AM
How many people actually go inside a blockbuster? Last I heard blockbuster's numbers were dismal, hence why they copied netflix. Since the HD-DVD's are still available on their online store, this is a non-factor. HD-DVD isn't going anywhere, did we already forget about the recent A2 sales?
I do have one question, how much is Sony paying blockbuster for this? Sony's marketing team is the best in the business.
Jordan @ Jun 18th 2007 9:28AM
I work at Best Buy in the home theater department and I'll tell you... I sell a HELL of a lot more HD DVD players than I do Blu Ray players. Now, I don't know how many PS3's we sell so I can't vouche for that. But I can tell you that when it comes to stand alone players, we sell a lot more HD DVD than Blu Ray players. BR has very recently started to become a little easier to sell with the new Panasonic that bundles 5 BR movies in the box for $500, but then again we have the A2 for $350 where you can pick your own 5 movies for free. Add on HD Advantage from Best Buy ($100 off any new high def dvd player with the purchase of a tv over $1,000) and you're looking at $250 for an A2 with 5 free movies. That basically ends up being almost the same price as a decent upconvert dvd player with 5 movies.
Any other BB employees have stories to tell on high def player sales?
Bob Meridian @ Jun 18th 2007 10:08AM
Is that why all of my BB's are already starting to phase out HD-DVD?
It's the same in every store. There are no HD-DVD players for sale and the HD-DVD section has been scaled down by 50%/Blu-ray section doubled.
Britboyj27 @ Jun 19th 2007 12:15PM
What the hell are you talking about? Every store in D13 (Oklahoma, Arkansas and the lower half of Missouri) has two bays of Blu-Ray AND HD-DVD both.
The number of movies of each format sent to each store is based on the number of players sold last fiscal year, so if your store sold more BD players in significantly larger quantities than HD-DVD, yeah it may have lost a bay, but this can change at any time.
All Best Buys sell both current HD players, but not all Blu-Ray players (Pioneer's and the high-end Panasonic are MHT products only)
Since the start of summer I've sold 16 HD-DVD players and 3 Blu-Ray players, however all of those HD-DVD players are to women or families over 35, who seem to pick HD-DVD for the catalogue titles, the Blu-Ray players are sold to men under 35, who pick CG laden new releases.
It's tit-for-tat. Neither format's picture quality is any better than the other, as it comes down to the source material anyway. The extra capactity of BDR is really only good for special features, and until one of the formats cuts $5-$10 off the cost of the movies themselves, it's going to be just like it has been: HD-DVD sells more players, BD sells more movies.
Dominic @ Jun 18th 2007 10:55AM
@Paul Fernandez: You make some good points, but denial lies on both sides of the fence. Although I favor BR prior to my PS3 purchase, I do think HD-DVD is not dead after this blow. Nobody will truely understand the forecast I believe sometime around Q4 2007 - Q1 2008.
As for the PS3 being hurt by the 360 or Wii. I would agree with you on the Wii, but in general (mostly compared to the 360), if you want to get your 360 comporable to the PS3, you actually spend more money. Sony's BR diode costs went from 125 to $8-10 per unit. They haven't lowered the price because they're trying to make "some" money back on their units. Expect something near the end of this year.
007baf @ Jun 18th 2007 11:24AM
I have made this comment before: Sony lost $2 BILLION last year and right now their Net Operating Income is $900+ MILLION. They lose money on every PS3 and are having to consider a price reduction to move them. Most PS3 owners are going to be the biggest DVD buyers (guns vs butter - or games vs movies).
Blockbuster's announcement is bad press for HD-DVD, no doubt. However, Blockbuster is a paper tiger. It is also losing money and market share. Its stock is at about $4.65 per share. I worked there at one time and it used to be incredibly busy, but its obvious that their fortunes have dwindled.
So, bad news, but probably a pretty small impact worldwide on the format war. I believe it's too early to tell who comes out on top, but Sony is hurting and so is their new "benefactor," Blockbuster. Microsoft and Toshiba both are quite profitable. Toshiba's profits have trippled. They are facing challenges in memory sales, but overall they are pretty healthy. With Toshiba and HP ($4.5 BILLION in Net Op Income) putting HD-DVDs into their laptops, economies of scale will be to kick in and a sub $100 HD-DVD player can't be far behind. This will be without giving away the bank.
The content will follow. Transformers will probably make a dent. So will reissues of LOTR. I'd put my bets on companies that make money and have cash vs companies losing money and who are laying off workers (Sony computer entertainment) any day of the week. Eventually, with highly paid executives getting laptops with HD-DVDs, the sales of the movies will grow. Even Sony Pictures will be put in a precarious position of having to support HD-DVD when faced with a choice of selling movies.
Fundamentals drive the corporate world, no fanboy wishes and dreams.
One more factor: XNA. Game developers will develop for XBOX 360 more and more because of it's easy portability to Vista (same guys with HD-DVD loaded up laptops will buy "Games for Windows" to play with while they travel).
gt200l @ Jun 22nd 2007 2:23PM
How could sony lose 2,000,000,000 and have a net profit of a 1,000,000,000...please get your facts straight market cap of sony is twice that of toshiba 52 billion to 26 billion...it more important to look at p/e ratios anyway...and
further more blu ray is
pioneer
sony: twice the size of Toshiba
LG: about the size of toshiba 25 billion
SAMSUNG:over 5x the size of size of toshiba at 150 billion in sales 9.5 billion in net profit, sharp, mitsubishi
matsushita: panasonic jvc et al twice the size of toshiba by itself at 52 billion)
onkyo
Kevin Murphy @ Jun 18th 2007 11:24AM
Well, with all the HD DVD players being sold, this just looks like another bad Blockbuster decision, narrowing their customer base further. Another reason to go to Netflix.
As for Best Buy .. all my local stores have two racks of each. I thought that one of them had cut their HD DVDs in half, but they just had them on both sides of an aisle end. I note that the BD racks are fuller and neater, and the HD racks look like 100 hands have been through them recently.
And again, I note that the titles for BD appeal mostly to teen-age boys of all ages, probably because of the PS3. Content cuts both ways.
Paul Fernandez @ Jun 18th 2007 11:51AM
Listen, no matter what, HD DVD is the fly in the ointment despite all the hype and negative press. Many consumers are choosing the format because it's cheaper and just as good. And everyone who reads these forums knows full well that HD DVD would be in the lead if it weren't for the PS3 surge or the fact that it hasn't been prominently and/or correctly displayed in stores like Blu-Ray has. Sold players
means people want what Universal, Warner, and Paramount have to offer. And don't sleep on The Weinstein Company or upcoming releases like "Hot Fuzz" or "Dawn of the Dead" (or "Shaun of the Dead," for that matter).
Ask yourself this: If the format is dying and has less studio support than its rival, why are HD DVD players still selling out in record numbers? Trust me on this: even if HD DVDs are phased out, consumers will STILL have a quality hi-def player that upscales regular DVDs beautifully to 1080i/1080p. And, while this isn't a substitute for true high definition, it will suffice for those who aren't interested in Blu-Ray. I plan to use mine until a newer format arises or digital distribution becomes the norm. Lionsgate films on Marketplace anyone?
I'd even wager that, with the upswing in HD DVD players, if Universal and, say, Fox or Disney announced they were going format-neutral TOMORROW, sales for the latter's films on HD DVD would soar past Universal's on Blu-Ray. I'm sure the studios know this, but I suppose there's too much riding on them NOT to defect. Sometimes, I wonder if it's nothing more than sheer spite.
Dominic @ Jun 18th 2007 12:06PM
Paul Fernandez: I forget where the post is, but where HD-DVD gets the points is it's name including the word "DVD" in it (great marketing). It's a double-sided sword. A lot of confusion mentioned on the Amazon customer reviews say their HDDVD disc would not work on their DVD player... there's people out there who actually bought discs thinking it would read on old players (unknown margin).
The biggest line of defense that HD-DVD groups say, "well if it werent for the PS3 surge" is like saying "well if HD-DVD never lowered their prices". Honestly, quit using that as a line of defense, it's ridiculous. And I wont deny the fact that HD-DVD sales are doing great, but I'm still not convinced from the longterm perspective... it remains a lost leader in my eyes.
Ken @ Jun 18th 2007 12:06PM
The fanboy posts are the best. Amazing how pathetic some people are.
rick @ Jun 18th 2007 12:59PM
The fact is that this is a big publicity hit against HD-DVD. Doesn't matter whether your a fanboy or not, what matters is what the masses hear and see. Most people are not aware of the war as intimately as those of us who read sites like this or AVS Forums. They just run across things from time to time, and I have to tell you, this one hits where it hurts. I actually didn't read this on the net first, I heard it on my radio station on the way to the office. KLOS, one of the biggest classic rock stations in So. Cal., with a huge listenership, read this story in their news brief. I would wager that it will be carried in some sort of fashion in most 5 o'clock news shows as well.
This one is going to hurt.
Steve @ Jul 17th 2007 8:01AM
Blockbuster has been in the game for many years longer 1985, vs 1998 13 years later Netflix. For what Blockbuster charges per month $5.00 and the ability to exchange viewed movies for an additional movie in store. Now thats something Netflix will NEVER be able to do because they do not have a STORE.. Turn around time for getting Netflix time is horrible.. And their online streaming.. buffering isn't nearly the quality that you get with an actual DVD 640x480 nor does it come with all the extra footage that a DVD comes with. SO a couple of year for Blockbuster to go down the tubs. Yeah right..
Paul Fernandez @ Jun 18th 2007 1:38PM
@ Dominic
Point taken, and thanks for your earlier comments, but it's not a "line of defense," it's a point of fact. I'm also a little confused by your "lost leader" comment. You can't be both, which makes this an oxymoron. : )
@ Ken
i think you have your definitions crossed. Defending your position with valid information does not make one a fanboy. This is what debating is all about and why we contribute to blogs like this. Fanboys are the immature guys who scream and yell on forums in defense of something without anything to substantiate their claims. Everyone with the exception of Dave (News flash: "HD DUD" is infantile; you can do better.) has contributed to this post without any "fanboyism," so what's your point?
joe @ Jun 18th 2007 1:57PM
007-
The GAMES division lost 2 billion dollars. Sony still MADE 500 million in the same period of time. Mostly on the strength of is MEDIA and HD-TV divisions. Media and TV's are exactly what the blueray format war involve.
Media is part of a major loss at MS the Xbox project ALONE has lost over 10 billion dollars since it was made. Zune and HD-DVD are also adding to their losses. They have not figured out how to get ANY ROI on any media investment, ever.
Toshiba is loosing the format war in a big way. The whole point of HD-DVD was to recoup the razor thin margains that they were making on dvd. Cheap players mean that they have all but given up on making a profit on players. While they flood the market with cheap players that means only chinese oem players will be able to make a profit putting the industry right back in the position it was with DVD, the position of NO PROFIT.
Universial is the only company that can benifit at this point because their media is still released on multiple formats.
Toshiba is KILLING hd-dvd with their cheap players. MS-media divisions are "loss leaders" for MS with huge losses and no return on investment on the horizon.
Universial will continue to make money on media with the lowest attchment rate,DVD. At least until the prices of DVD and HD dvd go down to the point where there is no room for profit there either.