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High-def hokum - January 6, 2008

LAS VEGAS--Toshiba America marketing VP Jodi Sally pleaded for sympathy at Toshiba's press conference here Sunday on the eve of CES. "This is a tough day for me," she said, prefacing her scheduled remarks on the state of the HD DVD business. "Obviously, the events of the last few days have shifted my comments for this morning." The "events" to which she referred, of course, was Friday's announcement by Warner Bros., once HD DVD's strongest proponent among the studios, that it was abandoning its support of the format and will release its high-def titles exclusively in Blu-ray starting later this year.

Beyond that, she stuck to the statement Toshiba released on Friday, expressing it's "surprise" at Warner's move, "despite the fact that there are various contracts in place between our companies concerning the support of HD DVD."

I doubt Toshiba was really surprised, except perhaps by the timing, given the extensive maneuvering behind the scenes by both sides to try to land studio exclusives. It had to know that Blu-ray was actively wooing Warner, just as Toshiba had been working on Fox.

Media Wonk was genuinely surprised, however, by Warner's public rationale for the move. “Warner Bros.’ move to exclusively release in the Blu-ray disc format is a strategic decision focused on the long term and the most direct way to give consumers what they want,” studio chairman Barry Meyer said. “The window of opportunity for high-definition DVD could be missed if format confusion continues to linger."

It wasn't that long ago, however, that Warner believed the best way to remove consumer confusion was to release in both formats. Warner officials, in fact, eagerly provided Media Wonk with sales data, the better to make the case for a dual-format strategy.

Warner Home Entertainment president Kevin Tsujihara stressed in his comments that "Consumers have clearly chosen Blu-ray, and we believe that recognizing this preference is the right step in making this great home entertainment experience accessible to the widest possible audience."

It was only six weeks ago, however, that Sony chairman Howard Stringer was declaring the format war a "stalemate." That doesn't exactly square with consumers having made a "clear choice."

I don't doubt that Warner had its reasons. And I do doubt that an alleged pay-off from Sony was the only determining factor even if it did occur. It's quite plausible that the faster-than-expected deterioration in the market for standard DVDs in latter part of 2007 has sharpened the studio's interest in bringing some clarity to the high-def market to try to spur consumers adoption. The situation is becoming very serious. But I suspect the decision to go with one format or the other came first, and the consumers "clear" preference for Blu-ray was discovered later.
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