Here we go again: another battle for the hearts and minds of the TV-viewing public. This time its not Blue America vs. Red America, but Blue vs. Blue in a conflict between two high-capacity blue-laser DVD standards: Blu-Ray Disc and HD-DVD (HD stands for high definition). At stake is the ownership of an optical storage standard for movie distribution, TV recording, computers and games.
Blue laser technologies have been in the works for years, but products are only now reaching the market. Sony shipped a Blu-Ray DVD recorder in Japan this spring, and Panasonic will follow suit this month. Demand for blue-laser devices should grow along with the expansion of high definition TV, which requires far more capacity than is available with todays red-laser DVDs.
Both Blu-Ray and HD-DVD drives use a blue-violet laser with a wavelength of 405 nanometers, as compared to a red lasers 650 nanometers. This shorter wavelength light can be focused into a smaller spot, allowing engineers to cram more data within a given space. Together with tighter track density and other enhancements, the blue-laser capability boosts capacity far beyond 4.7-gigabytes of a conventional DVD. HD-DVD provides 15 gigabytes for read-only discs and 20 gigabytes for recordable ones, while Blu-Ray boasts between 23 and 27 gigabytes. Thats enough to store five or six full-length movies on a single disc, relegating the DVD bonus disc to the dustbin of history.
The chief impact, however, will be with HDTV. Both blue laser standards provide sufficient access speeds (36 megabits per second) to record HDTV content in real-time, and with proper compression, even the 15-gigabyte format can hold a two-hour high-definition movie. Both camps also promise dual-layer versions in the coming years that will double capacity.
Blu-Ray products should begin shipping in the United States next year, with prices between $2,000 and $3,000. In addition to Sony and Panasonic, expect other recorder products from fellow Blu-Ray members Hitachi-Maxell, LG Electronics, Mitsubishi Electric, Pioneer, Philips, Samsung, and Sharp. Blu-Ray has also earned endorsements from TDK, Dell, and Hewlett-Packard, giving it an edge in the computer market.
HD-DVD builds upon the existing DVD format, promising cheaper media production and easier backward compatibility than Blu-Ray. Having finalized version 1.0 of the spec in June, the two companies pushing this formatNEC and Toshibaplan to ship products in 2005. HD-DVD has won the endorsement of the official DVD standards body, the DVD Forum, as well as Microsoft, which is contributing its VC-9/Windows Media Video technology as the formats video compression and digital rights management technology.
The two blue laser technologies are quite different and its unlikely that they could be merged, as occurred with two rival formats that contributed to the original DVD standard in 1996. Blu-Ray uses a single-sided disc whereas HD, like DVD, is a double-sided format. (These sides are not to be confused with the additional layers in a dual-layer disc format, which both the Blu-Ray and HD camps are promising to double capacity.) Blu-Rays ability to hold more information than HD is due primarily to its use of a thinner transparent plastic layer covering the data layeronly .1 millimeter compared to the .6 millimeters of DVD and HD. Blu-Ray proponents claim the that the thinner layer minimizes the threat of errors introduced due to laser-beam splitting and disc-tilt problems. These improvements, however, require new disc manufacturing equipment and could make Blu-Ray DVD players more expensive than HD ones.
HD-DVDs early standards victory may not be enough to stop Blu-Ray. As it was, even with the lobbying of Microsoft, HD-DVD won approval by only a single vote. There seems to be a consensus around Blu-Ray, says Danielle Levitas, director of consumer research at IDC.
If Blu-Rays momentum slows and the standoff continues, the market could be further Balkanized by two other blue-laser contenders: Enhanced Versatile Disc (developed by the Chinese government) and Forward Versatile Disc (a government project from Taiwan.) Even if the impact of these formats are limited to their home countries, by the time blue laser DVDs are ready for prime time, China will represent an enormous consumer electronics market.
Whatever side eventually dominates, the payoff will be a long time coming. The potential market is much more limited than red-laser DVD, says Levitas. Today, she says, the only reason to buy one of the devices is to record HDTV programming. The enterprise storage market is in no big rush, having many other storage options available, and the recent arrival of 8.5-gigabyte dual-layer recordable DVDs could satisfy near-term demands in the consumer PC market. Hollywood may start to release some HDTV movies in a blue-laser format by 2006, but the library will likely to be limited for several years.
Although the HDTV market has been growing at a 50 percent annual clip, according to a recent report by The Home Technology Monitor, only 6 percent of TV owners own a high-definition set. Whats more, the trend is less than universal. HDTV is pretty much limited to Japan and the U.S., says Levitas. The rest of the world is pushing [lower-resolution] digital TV. Even in the United States, many consumers are foregoing HDTV to make the less expensive leap to digital televisions and progressive-scan DVD players. Whereas HDTV offers about two million pixels per picture (vs. 350,000 for conventional television), lower-resolution digital formats such as Standard DTV and Enhanced DTV offer a variety of resolutions in between. Progressive-scan players scan twice the number of horizontal lines as a standard interlaced player, producing a sharper picture. When consumers do upgrade to HDTV, they may not rush out to buy yet another expensive appliance. If you pop a standard DVD into a progressive-scan DVD player and connect it to an HDTV set, the picture looks pretty darn good, says Levitas.
That’s why widespread acceptance of blue-laser DVDs is not likely to come for a long timeand by then, other technologies will probably have arrived to blunt their impact. In ten years, HDTV should be fairly well established. That could spur demand for blue-laser devices, which should approach commodity prices by then. (One problem with blue DVD technology is that no one has come up with a cheap mass production process for the blue lasers, which currently cost about $1,000 a pop.)
In a decade, however, widespread deployment of HDTV video-on-demand services and hard drive video recorders (e.g., TiVo) could slow uptake. “Most people just want to time-shift TV programming, says Levitas. If my cable provider gives me video on demand and a hard-drive recorder, why do I need a blue-laser recorder? If theres a competitive library of on-demand high-def content, do I really need to own a disc anymore? I dont think blue-laser will be as popular as VCRs were or as red-laser DVD is likely to be.
Levitas may underestimate the innate and often illogical human need to hoard. Yet its clear that the media consumers of the next decade will have numerous options. In the meantime, it will likely be the film industry that chooses the blue-laser winner. So far, Warner Brothers has endorsed HD-DVD and Sonys Columbia Tri-Star has picked Blu-Ray, but other studios have remained mum. Whatever the choice, Hollywood is likely to proceed cautiously. Thanks to cheap multifunction drives, the scuffles over DVD recordable formats are history, and sales and rentals of DVD drives, players, and media are exploding. According to IDC, 200 million DVD devices have shipped since 1997, and this year that number should grow by a third. Hollywood doesnt want to kill the golden goose too soon, says Levitas. Right now theyre making a ton of money off of DVD.
Over time, blue-laser could be big, but its not likely to have the impact of todays DVD. Slow HDTV growth, expensive blue-laser production, expanding video-on-demand services, cheaper, bigger, hard-drive recorders, and Hollywoods innate conservatism all indicate that the road to blue DVD success will be a long slog. And that’s a timetable that plays into the hands of the less compatible, but more ambitious Blu-Ray.
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