Toshiba Looking to China For Cheap HD Players27 Oct, 2005 By: Erik Gruenwedel
Taking a strategic page from Wal-Mart, Toshiba Corp. reportedly is negotiating with China to produce its next-generation HD DVD players.
The move is significant on two fronts. For one, it underscores Toshiba's steadfast determination to bring HD DVD product to market while keeping a lid on the price. Proponents of the technology have long maintained that replication similarities with standard DVD provide HD DVD with an economic advantage over rival Blu-ray Disc. Blu-ray has a thinner wall disc that requires a complete retooling of replication facilities and, therefore, is considered more expensive to produce.
In addition, Toshiba's willingness to work with China flies in the face of historical tensions between Japan and China. Just this month, Japanese Prime Minister Junichiro Koizumi angered China and South Korea, following a controversial visit to a shrine in Tokyo honoring the country's World War II dead, including classified war criminals.
Still, China expert Michael Murphy said Toshiba's move emphasized its desire to take advantage of China's low-cost technological manufacturing capabilities.
“They are becoming the factory floor to the world,” said Murphy, editor of the California Technology Stock Letter. “It's probably time to put [political differences] behind and do what everybody else is doing, which is taking advantage of what is probably the best place in the world to build stuff.”
Toshiba also could be looking to China to fast-track HD DVD production following last week's announcement by HD DVD supporter Warner Home Video that it had joined the board of the Blu-ray Disc Association (BDA) and would release its films on the format.
Toshiba, which said the studio continues to collaborate closely toward the commercial launch of HD DVD, characterized Warner's sudden allegiance to Blu-ray as an “understandable commitment” designed to make technical evaluations of each format and keep its options open.
A Warner spokesperson said the studio's support for Blu-ray did not exclude continued support for HD DVD.
Toshiba said the decision would not affect introduction of HD DVD content and said Blu-ray backer Hewlett-Packard's recent appeal to the BDA to include two HD DVD technologies, iHD and Managed Copy, as part of Blu-ray specifications highlighted HD DVD's legitimacy.
Toshiba said in a statement that it strongly believed HD DVD eventually would win broad support as the superior format. “We are committed to bringing HD DVD products first to market early next year in the United States.”