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The Real Reason HD DVD Failed Spectacularly

The early 2000s brought us many things: flip phones, the original iPod, and binge-watching DVD box sets on our new flatscreen TVs. These TVs supported fancy features like “high definition” for the first time. There was just one problem — people were still watching standard definition DVDs on these screens.

It was time for a new physical HD video format to emerge.

Out of this need came two dueling formats — HD DVD and Blu-ray. HD DVD launched first and seemed poised to rule the world of HD movies with the backing of major tech titans. In contrast, Blu-ray started with far less support and its future looked grim.

Yet in just over two years of coexisting, HD DVD failed spectacularly, forever linked as a cautionary tale of how even the most promising standards can be toppled.

Let’s analyze the brief, fascinating history behind HD DVD’s rapid demise at the hands of its rival…

HD DVD Arrives With High Hopes

The HD DVD format was the brainchild of Toshiba and the DVD Forum — an industry group with consumer tech giants like Microsoft, Intel, and HP behind it.

HD DVD promised several benefits:

  • Continued the standard DVD’s dimensions and shape
  • Utilized existing DVD manufacturing facilities
  • Offered HD video quality up to 1080p resolution
  • Enabled HD recording capabilities

Backwards compatibility was a key feature. HD DVD players could play old DVDs, while the discs utilized cost-effective red laser diodes like DVDs. It was essentially a beefed up sequel to DVD.

Most critically, HD DVD had the backing of 62 companies who were members of the DVD Forum. This broad support suggested rapid, widespread adoption was all but guaranteed.

With these strengths behind it, HD DVD arrived first to market in early 2006. Anticipation was high that this would be the disc we’d use for HD movies and beyond.

Blu-ray Stumbles Out of the Gate

Of course HD DVD had competition right from the start in the form of Blu-ray discs – developed primarily by Sony.

Blu-ray entered the ring with a shakier foundation though:

  • Required adoption of new costly blue laser diodes
  • Had no support from the DVD Forum
  • Managed only 22 members of its own Blu-ray Disc Association
  • Confronted a looming format war with HD DVD

Essentially, Blu-ray seemed destined to follow past Sony-led standards like Betamax into obscurity at the hands of the better positioned HD DVD juggernaut.

Boy, did things turn out differently…

Here is a breakdown comparing the key attributes of the formats:

Spec Comparison HD DVD Blu-ray
Video Encoding Advanced Video Codec High Definition (AVCHD) High Efficiency Advanced Audio Coding (HE-AAC)
Date Released March 2006 June 2006
Peak Video Resolution 1080p / 1920×1080 1080p / 1920×1080
Disc Capacity (single layer) 15GB 25GB
Laser Wavelength 650nm red laser 405nm "blue" laser
Data Transfer Rate 36 Mbps 54 Mbps at launch
Later increased to 128 Mbps
Interactive Features Microsoft‘s HDi
Java-based interactivity later added via a 2007 update
Java-powered BD-J interactivity natively supported
Digital Copy Support No Yes – Blu-ray incorporated Digital Rights Management from launch
Backwards Compatible? Yes – could play old DVDs and CDs No – first gen players were incompatible with most CDs/DVDs
Audio Codecs Dolby Digital Plus
Dolby TrueHD
DTS
DTS HD Master
Dolby Digital
Dolby Digital Plus
Dolby TrueHD
DTS
DTS HD Master

With the two formats preparing for battle, most analysts predicted HD DVD would charge ahead based on the strength of its backers while Blu-ray sank into niche status. Of course, that’s not what happened…

The PlayStation 3 Changes Everything

Sony made one monumental decision that started tipping scale in Blu-ray‘s favor.

The secret weapon was the PlayStation 3 (PS3).

Sony chose to include a Blu-ray disc drive in every PS3 sold when it launched in late 2006. This instantly put millions of Blu-ray players directly into consumers’ homes overnight.

It helped that the PlayStation brand held over 90% market share in gaming. So tens of millions of PS3s were destined for households eager to play next-gen games.

Gamers relished utilizing Blu-ray movies to showcase the PS3’s stunning HD graphics as well. It was a perfect storm to drive awareness and adoption of Blu-ray.

Microsoft made no such provisions with their rival Xbox 360 console. HD DVD external add-on drives existed, but couldn’t compete with millions of gamers owning Blu-ray ready PS3s.

Blu-ray went from obscurity to mainstream relevance almost literally overnight thanks to PlayStation. This was the beginning of the end for HD DVD.

Movie Studios Switch Their Allegiance

Throughout 2007, Blu-ray disc sales continued growing faster thanks in large part to the immense PS3 numbers.

Several key events also caused movie studios to gravitate from HD DVD to Blu-ray’s camp:

  • Blu-ray incorporated higher density discs from the start, able to fit significantly more data with a single-layer holding 25GB — 50% greater than HD DVD
  • Visual quality benefits emerged thanks to this additional capacity
  • Consumers increasingly went Blu-ray to match their PS3 purchases

Seeing the momentum swinging towards Blu-ray, major US retailer Best Buy announced in June 2007 that it would strongly recommend Blu-ray over HD DVD going forward based on sales trends.

By 2008, Blu-ray had achieved over 70% market share in the US compared to 30% or less for HD DVD.

The final coup de grâce came in January 2008 when Warner Bros declared it would become Blu-ray exclusive. This was critical because Warner distributed films supporting both formats to that point.

Toshiba tried enticing Warner Bros to stay neutral at the last minute, but the company instead sided fully with Blu-ray. It proved to be the death blow.

HD DVD Walks The Plank

Just over a month after Warner Bros defection, Toshiba officially surrendered and put the embattled HD DVD format out of its misery on February 19, 2008.

The company stated:

“We carefully assessed the long-term impact of continuing the so-called ‘next-generation format war’ and concluded that a swift decision will best help the market develop.”

Remaining studios like Universal announced they’d switch to distributing films exclusively on Blu-ray as well. Just two years after it launched, HD DVD was finished.

Blu-ray stood victorious — astonishing considering how unlikely this outcome appeared when it lagged so far behind HD DVD from the outset.

The PS3 proved instrumental in handing Blu-ray the keys to the HD video kingdom and Toshiba learned the hard way how even industry juggernauts can have their standards defeated unexpectedly.

It’s a fascinating case study in consumer choice ultimately deciding these format showdowns.

Had Microsoft recognized the importance of these gaming consoles in driving adoption, perhaps it would have beaten Sony to the punch by baking an HD DVD drive into the Xbox 360. Of course hindsight is 20/20!

Regardless of what could have been, Blu-ray won this round to live on as the premier HD movie format of the late 2000s and much of the 2010s.

Streaming may rule the roost today, but Blu-ray still stands out for movie lovers wanting the best quality cinematic experience possible in their home theaters.