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Warner Chooses Blu-ray

4 Jan, 2008 By: Thomas K. Arnold

Warner Home Video today announced it is casting its lot exclusively with the Blu-ray Disc format, leaving rival HD DVD with just two major studios.

The move, which had been both widely expected and publicly denied, comes on the eve of the Consumer Electronics Show, where both next-generation disc formats have big presentations on the agenda.

Warner, the biggest Hollywood player in the home entertainment industry with a market share of more than 20%, previously had been the only major studio to release titles in both Blu-ray Disc and HD DVD. The decision to ditch HD DVD after May 2008 gives Blu-ray a decided advantage, since the format now enjoys the exclusive support of four of the six major studios — Warner, Walt Disney Studios, Sony Pictures and 20th Century Fox — as well as mini-major Lionsgate.

The move also mitigates any momentum HD DVD might have gained last fall when Paramount/DreamWorks abandoned its dual-format strategy and began releasing titles only in HD DVD. After that, the format war everyone expected would be long over appeared to be headed toward a stalemate.

Subsequently, at the Blu-ray Disc Festival in Hollywood, a Warner executive said the studio would re-evaluate its dual-format strategy at the end of the fourth quarter, after monitoring sales, and throw its support behind only one.

Warner said its decision to go exclusively with Blu-ray was based on consumer demand. In a statement, Warner Bros. chairman and CEO Barry Meyer called it “a strategic decision focused on the long-term and the most direct way to give consumers what they want.”

“The window of opportunity for high-definition disc could be missed if format confusion continues to linger,” Meyer said. “We believe that exclusively distributing in Blu-ray will further the potential for mass-market success and ultimately benefit retailers, producers and, most importantly, consumers.”

While Warner isn't pulling the plug on HD DVD releases immediately, the studio will only issue forthcoming titles on HD DVD “after a short window following their standard DVD and Blu-ray releases,” according to a statement.

While Warner in the past has said its dual-format strategy allows it to maximize sales in the nascent HD media market, consumer confusion ultimately became a bigger issue.

“A two-format landscape has led to consumer confusion and indifference toward high-definition, which has kept the technology from reaching mass adoption and becoming the important revenue stream that it can be for the industry,” said Kevin Tsujihara, president of the Warner Bros. Home Entertainment Group.“Consumers have clearly chosen Blu-ray, and we believe that recognizing this preference is the right step in making this great home entertainment experience accessible to the widest possible audience.”

According to Nielsen VideoScan, 64% of all high-definition discs purchased by consumers this year have been Blu-ray. Studios supporting Blu-ray have a combined market share of 67%, to 23% combined for Paramount and Universal Studios, the only two majors supporting HD DVD.

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