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Industry Readies for HD DVD Launch

14 Apr, 2006 By: Erik Gruenwedel

Like the venerable Hollywood adage “The show must go on,” select studios, retailers and rental services appear determined to follow through with the April 18 release of the first four major studio films on HD DVD.

Warner Home Video streets The Last Samurai, Million Dollar Baby and The Phantom of the Opera, while Universal Studios Home Entertainment releases Serenity.

Additional Universal HD DVD titles Doom and Apollo 13 will be available April 25.

Toshiba Corp., which originally planned to roll out U.S. shipments of HD DVD players with studio releases of HD DVD titles, will bow hardware the following week.

Sony Pictures Home Entertainment has stated it intends to stick to the original May 23 release date for eight titles in rival Blu-ray Disc format. Mini-major Lionsgate, however, delayed until June 27 its initial Blu-ray releases of Lord of War, Crash, Saw and Terminator 2: Judgment Day.

Despite the dearth of HD DVD players and limited number of titles available, analysts said retailers have little choice but to embrace the new technology.

“You're not going to see big [retail] sections, just little sections at a time,” said one analyst, who said HD DVD software's advance release to hardware mirrors the initial rollout of Microsoft's Xbox 360. “It's not like Wal-Mart will free up a bunch of shelf space.”

Several big box retailers have referenced HD DVD hardware and software information and availability on their Web sites.

The analyst said retailers might be a bit confused about HD DVD and Blu-ray, but they have little choice stocking it “since it is going to happen whether they want it or not.”

Analyst Arvind Bhatia, with Dallas-based Sterne Agee, said that until the actual product reaches store shelves it will be a non-event. He believes consumer awareness about HD DVD is little to non-existent.

“I don't anticipate a lot of activity day one,” Bhatia said. “When the product actually comes out, that's when the studios will make a big deal about it. Why spend your advertising dollars when you can't really sell the product?”

It might just be four titles, but it was enough for Blockbuster Online to announce it would give subscribers — starting April 18 — the ability to add the HD DVD movies to their rental wish lists.

Dallas-based Blockbuster Online, which has stated it is format agnostic, found that 47% of its surveyed subscribers were “somewhat interested” in watching high-def discs.

About 55% of respondents said they had high-definition compatible TVs, and 33% indicated an interest in purchasing HD hardware predicated on price, emergence of a standard HD format and availability of titles.

“It's the old beta versus VHS dilemma,” Blockbuster's Evangelist said. “There's no way to know how long it's going to take for the general market to decide which format will ultimately prevail. So while this shakes out, we're just going to listen to our customers and make sure we give them the movies they want in the format they prefer — whatever the technology.”

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