HD-Day for Toshiba?

Toshiba won't confirm that it's raised the HD-DVD white flag, but that hasn't stopped the celebrations...

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Last Updated: 31 Aug 2010

Reports emerged in Japan this weekend that electronics giant Toshiba was set to abandon its HD-DVD platform, leaving Sony’s rival Blu-ray format as the undisputed winner of the pair’s long-running battle. Although Toshiba has refused to confirm the rumour, insisting that nothing has been decided, it was greeted with delight by the stock market – Toshiba’s shares jumped about 6% on Monday morning, with investors clearly feeling this would allow it to focus on battles that it’s got more chance of winning.

The news would certainly be a welcome boost for Sony, which has fared less well in previous format wars – most famously losing out in the Betamax-VHS war of the 1980s. And that’s despite the fact that it doesn’t seem to have changed its approach as a result: yet again it’s gone for the more expensive, more technologically-advanced option – but this time it seems to have ended up on the winning side.

The key for Sony has been its success in persuading the major Hollywood studios of the merits of its format. In January Warner Brothers became the fifth Hollywood studio to back Blu-ray, leaving only Universal and Paramount Pictures in Toshiba’s corner. Then on Friday US retail giant Wal-Mart announced that it planned to stock the Blu-ray format exclusively – which looks to have been the final nail into HD-DVD’s coffin.

Toshiba’s exit is likely to be good news for high-definition DVD sales – since the two formats are largely identical but completely incompatible, many consumers have held off buying one or the other until a clear winner emerged. Now Sony seems to have triumphed, the market may pick up – or at least it will do for a couple of years, until the next generation of players renders the entire format obsolete…

This may also be some consolation to the red-faced Toshiba and its various backers (who include technology giant Microsoft). Admittedly it’s thought to have frittered away an eye-watering $2bn on its ill-fated platform – but at least cutting its losses now will allow it concentrate on getting one step ahead in the next format war...

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