... It's all over but the Shouting
Well, it's been an interesting 48 hours since Warner's war-ending announcement that they would be supporting the Blu-ray disc format exclusively, and dropping all support for the HD DVD format in May of this year. Much has been stated, both officially and unofficially... so here's the rundown.
Friday's Official Reaction
The first thing that happened (almost immediately) was that Toshiba issued a press release stating that they were "shocked" and "disappointed" by Warner's announcement, and that they would "assess the potential impact of this announcement with the other HD DVD partner companies and evaluate potential next steps."
While that was rather boilerplate on its face, the shocked statement is rather odd given the events behind the scenes. Not having an immediate "plan B" was far more shocking to me than the Warner announcement (which nearly everyone had been expecting for some time now). Regardless, the apparent "next step" they evaluated and decided on was to completely cancel the HD DVD PRG's press conference at CES as well as the individual interviews with reporters.
Let the FUD Begin!
Well, that was what "officially" happened on Friday. Unofficially, the war ended. Blu-ray fans rejoiced... and HD DVD fans immediately reformed themselves into two camps. The first camp readily accepted defeat and is at least glad that only one format will exist going forward. While they all wish HD DVD had been the victorious format, they at least are glad that this nonsensical war will be brought to a close, and that hopefully more consumers will embrace high-definition media as a result. The second camp... well... they let loose a tirade of legal threats and claims of bribery, and officially announced that they won't support Blu-ray no matter what. It's hard to take these people seriously, but some of their claims are pervasive, so here's my quick rundown on the most ludicrous claims:
1) "HD DVD isn't dead."
Yes, it is. All the "ways we can still win this" are insane. Toshiba isn't going to spend billions upon billions of dollars to try to salvage HD DVD at this point. They may continue on a bit longer pretending to, but they aren't going to pony up the cash necessary to "buy" consumers, now that they've failed to buy movie studios. Likewise, Universal and Paramount execs have no reason to continue supporting Toshiba's failed format. They have contracts (at least Paramount does)... but those contracts have "outs," and you can bet they're looking at every option to get out as soon as possible. These companies have investors to answer to... not format "fanboys." The fact that neither studio has said anything to reaffirm its commitment to HD DVD since the Warner announcement is VERY telling.
2) "Warner wanted to go HD DVD... and Fox was ready to go to!"
Truth is, no one knows exactly what the motivations or desires of the various companies are/were, but here's essentially what we KNOW happened behind the scenes.
Last August, Toshiba knew they needed to make a big play and take away some of Blu-rays studio support. They approached Warner with a large offer if they would go HD DVD exclusive. They were turned down. Warner came out and said that they were interested in going format exclusive, but wasn't going to do it in the direction of extending the war indefinitely. They wanted the war over. Toshiba took their offer to Paramount, and Paramount accepted. The Blu-ray companies didn't find out until it was too late, but decided that it was time to go on offense.
Starting in September, Sony began a long negotiating process with Warner to get their exclusivity. Warner made it clear to all parties that they were going to make a decision after seeing the fourth quarter sales numbers. Obviously, this made Blu-ray confident as sales of discs and total players (including the PS3) were heavily in their favor. Toshiba knew it needed to make a play, and approached Warner again.
By the end of December, it was clear that Blu-ray had the sales advantage as well as the studio support to continue as the single format, and Warner told Toshiba that they would not go HD DVD exclusive unless Toshiba could get one of the Blu-ray supporting studios to go with them. Knowing that Sony and Disney wouldn't even talk with them, they approached Fox. Fox accepted the meeting, and some negotiations took place. Whether or not Fox really considered an offer, just wanted to see what Toshiba would offer, or was just playing Toshiba for fools, can't be clearly stated by anyone outside of Fox. Regardless, in the end, Fox passed on the offer, and Warner announced Blu-ray exclusivity.
3) "Warner was paid million billion trillion kajillion dollars by Sony to go Blu-ray exclusive."
Who knows? You don't... I don't. There hasn't been ANYTHING in the press to indicate that this is so, unlike the widely reported figure paid to Paramount by Toshiba. Speaking in a conference call with reporters, though, Warner Home Entertainment President Kevin Tsujihara, had this to say:
"The packaged media business is a $42 billion dollar business worldwide at the retail level, and we [Warner] have the largest market share of anybody. From our perspective, the most important piece of this whole puzzle is, "How do we get growth back into this category?" That far outweighed anything else. This [decision] was one hundred percent around what makes the most sense for the consumer, the retailer and the industry. This was not a bidding war. This was all about what was best, strategically, for us."
So, take that how you will, but it certainly doesn't appear that they were "bought." One way or the other, though... does it really matter?
Post-Friday Events
Saturday was essentially silent for "official news," though much of the above rhetoric was discussed to no end, and rumor-spreading reached an all new level of art.
Sunday marked the beginning of the official CES press conferences. Given the HD DVD PRG's pull-out from the event, many HD DVD fans who thought the format could continue in some form turned to Toshiba's press conference for news of how their beloved format would come back from the dead to claim the ultimate victory.
Instead, conference attendees were subjected to possibly the briefest press conference in CES history, followed by absolutely NO Q/A session. First, the President of Toshiba came out and essentially read their press release regarding their disappointment at the Warner news. Then, VP of A/V Marketing Jodi Sally (whose resume should hit Career Builder any time now) came out practically in tears, telling the attendees: "As you can imagine this is a tough day for me... I expected to come here today to share the successes of HD DVD... It's difficult for me to read all the pundits declare that HD DVD is dead, but we've been declared dead before." According to Gizmodo, she appeared to be fighting very hard not to break down onstage. I truly do feel sorry for her... if not the format her company supported.
And that was it. No 4th gen HD DVD players shown. No discussion of the path ahead. No bringing out Paramount or Universal executives to reaffirm their companies' commitment to HD DVD. In fact, no more mention of HD DVD what-so-ever. Just a brief discussion of Toshiba's new LCD TVs.
And this is how a format dies... not with a concession speech, but with the format fading away into oblivion.
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