Paramount Goes HD-DVD Exclusive

In the battle for supremacy between the HD-DVD and Blu-ray camps, an interesting and quite unexpected twist was taken yesterday – Paramount and Dreamworks have gone HD-DVD exclusive.

The biggest single advantage that Blu-ray has always had over HD-DVD has been that it has exclusive studio support from three of the major distributors (Sony, Fox, Disney) whilst HD only has one (Universal). The two remaining major power players – Warners and Paramount – have been format neutral and selling titles in both formats.

Now, Paramount has firmly planted it and Dreamworks’ flag in the HD-DVD camp. Claims of a multimillion-dollar financial behind-the-scenes deal are flying fast from industry speculators – backers of both formats offer not only studios but retailers financial settlements to ‘switch’ to their side.

The move is surprising – bolstered by the PS3, detailed figures released this month show that for the first half of 2007, Blu-ray is outselling HD-DVDs by a 2:1 margin (1.6 million vs. 795,000 in disc sales). Yet HD-DVD standalone players are outselling Blu-ray stand-alones by a decisive margin.

With only 200,000 HD DVD players in homes (vs. the PS3 enhanced 1.5 million Blu-ray numbers), the ratio should be much higher and it’s that ‘higher disc sales per player’ and higher consumer satisfaction advantage that Paramount Home Video execs are publicly citing as their reason for the switch. There is one condition of the release – films directed by Steven Spielberg will remain format neutral.

Not to be outshone, the Blu-ray camp fired back quickly with a lot of title announcements yesterday. More importantly Fox, the weakest link of the BR triumverate which many thought would become format neutral, have issued a statement reiterating their exclusive support for Blu-ray and announced nearly thirty new titles for release before year’s end.

With the three exclusive studios firmly entrenched in the Blu-ray camp, this move by Paramount will certainly lengthen this format war and give advantage to dual-format player manufacturers and companies developing high-def online downloads. I still stand by my personal rant the other week – I have both and there really is no practical difference. Get both players, with each title pick the one with the best quality (VC1 codec, PCM soundtrack, etc.) and if there’s an eventual winner and your losing format player stops playing, just copy the contents onto blank discs of the winning format.

Warners remains the only major studio publishing in both formats, and as a result also has the lions share of the market. Whilst it seems unlikely to switch to one exclusively, the company has shown a preference for HD-DVD in the past and many of its biggest high-def titles on the market presently are still only in HD-DVD format (eg. “Batman Begins”). Were it (and its subsiduary New Line) to switch to the HD-DVD camp exclusively, then the ‘war’ would officially become a stalemate and no winner would likely ever emerge. At present, BR remains the favourite to win but estimates on the timing of that victory have now been notably revised.

Paramount’s commitment will begin with next week’s release of Will Ferrell comedy “Blades of Glory,” with plans to release the film on Blu-ray scrapped. This will set up an interesting fourth-quarter with “Transformers,” “The Bourne Ultimatum,” “Shrek the Third,” “Knocked Up,” “1408,” and “I Now Pronounce You Chuck and Larry” all being HD-DVD only whilst “Spider-Man 3,” “Pirates of the Caribbean: At World’s End,” “The Simpsons Movie,” “Ratatouille,” “Live Free or Die Hard” & “Fantastic Four: Rise of the Silver Surfer” will be Blu-ray only. “Ocean’s Thirteen” and “Harry Potter and the Order of the Phoenix” will be the sole big Summer movies released in both formats later this year.