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HD DVD Movies Delayed Three Weeks

16 Mar, 2006 By: Thomas K. Arnold

It's official: When the first HD DVD players, from Toshiba, start arriving in stores later this month, there won't be any software for at least another three weeks.

Warner Home Video March 16 announced it has pushed back the release dates of its initial slate of HD DVD titles to April 18, from March 28.

The studio also has scaled back its launch to just three titles: Million Dollar Baby, The Phantom of the Opera and The Last Samurai.

Stephen Nickerson, the studio's SVP of market management, attributed the delay to technical issues.

“Everything we do is new,” he said. “We're using new copy protection, new compression, new codecs, and we want to make sure the product that goes out is flawless.”

The remaining 17 titles in the first wave of Warner's HD DVD launch — the total also has been scaled back to 20 from the 24 announced in January at the Consumer Electronics Show in Las Vegas — will be released in subsequent weeks, he said. These include Batman Begins, Charlie and the Chocolate Factory and The Matrix.

The finalized launch schedule comes as Warner research suggests high-definition packaged media could catch on with consumers even faster than DVD, regardless of the brewing format war.

Warner projects that by the end of this year, consumers will have bought nearly 600,000 set-top players, 450,000 of them HD DVD machines and the balance Blu-ray Disc players. That compares to 305,000 DVD players by December 1997, that format's first year.

Factor in Xbox 360 game consoles capable of playing HD DVD software, PlayStation 3 consoles that can play BD software and computers with HD media capability and the year-end tally could be as high as 8.5 million units.

Warner also predicts consumer spending on HD media by the end of this year will clock in at between $290 million and $740 million.

Nickerson said a survey of 1,500 early adopters the company undertook in early February showed 60% of them had a “strong interest” in buying HD hardware and software. Of the respondents, 80% already owned a high-definition TV set, while the remaining 20% said they would buy one within the next 12 months.

Nickerson said Warner believes the format war between the competing next-generation, high-definition optical disc technologies, Toshiba's HD DVD and Sony's Blu-ray Disc, would not stymie growth, as many observers have been saying.

“Two formats doesn't cause people not to spend money,” Nickerson said. “Confusion and a lack of being able to explain benefits, that causes people not to spend money.”

He sees both formats surviving and even thriving, pointing to the video game and flat-screen TV industries as examples in which there is room for more than one successful format.

Accordingly, he said, Warner's message to retailers is “80% about the benefits of high-definition media and 20%, oh, by the way, there are two formats and you might have to make a choice.”

He noted that by the end of this year, a projected 25 million HD TVs will be in U.S. households, and those consumers will want to have a high-definition successor to DVD in the market.

“We are not going to fight a format war,” Nickerson said. “The more time you spend fighting a format war, the less time you spend selling the customer.”

He said that Warner plans to support both formats, with HD DVD rolling out first because the players are coming to market first. Warner's first three titles are coming April 18, and beginning in May all new releases will be released day-and-date on both standard DVD and HD DVD.

Key catalog titles will be introduced on HD DVD beginning in July, while TV DVD releases will start arriving in the third quarter.

Warner's Blu-ray Disc software will launch in July.

Erik Gruenwedel contributed to this report.

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