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Toshiba Bows Out Of Fight Against Blu-ray

Posted on: Sunday, 19 July 2009, 12:25 CDT

Toshiba Corp. is now planning to enter the Sony-backed Blu-ray scene a year after admitting defeat with its own failed next-generation HD DVD format that could not get industry support.

Blu-ray products will likely be introduced by the conglomerate manufacturing company as early as this year, after fighting to prove the quality of its high density DVD standard, according to the Yomiuri Shimbun newspaper.

Toshiba's fight has been hit with several setbacks in recent weeks, including the announcement made on Friday by U.S. dominating retailer Wal-Mart Stores Inc that it would discontinue sales of HD DVD format and only carry Blu-ray movies.

"We have entered the final stage of planning to make our exit from the next generation DVD business," said an anonymous source. He added that an official announcement could come as early as next week.

Public broadcaster NHK said Toshiba would suffer losses up to hundreds of millions of dollars in halting their production of HD DVD players and recorders and other measures required in withdrawing from the business.

Toshiba’s previous struggle to out-promote the Blu-ray system with its own HD DVD format was reminiscent of the old debate over the VHS-Betamax and videocassette tapes waged in the late 1970s, and in turn caused great confusion for consumers over which product to buy. This confusion hindered the development of what is expected to be a multibillion-dollar high definition DVD industry

In the beginning, Hollywood studios had supported both parties by having certain films only play on one of the DVD machines.

But Time Warner Inc.’s Warner Bros studio majorly offset the balance with the decision to only release high-definition DVDs in Blu-ray format. At this point, Blu-ray completely dominated the key Japanese market.

Toshiba responded by drastically cutting prices of its HD DVD players, but the damage was already done and the loss of retail support hurt. 

Consumer electronics chain Best Buy Co Inc. and online video rental company Netflix Inc. joined with Wal-Mart in jumping on the Blu-ray wagon.

Software giant Microsoft Corp also said in January that it might consider supporting Blu-ray technology for its Xbox 360 video game machine, which currently supports only HD DVD.

Sony has invested a large amount of money to promote Blu-ray in conjunction with its flat screen TVs and its PlayStation 3 game console, which doubles as a Blu-ray movies player.

Though it is indeed a major setback, it does not amount to a total loss for the highly diversified conglomerate, which has products ranging from refrigerators to power plants. They will, however, likely learn a valuable lesson.

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On the Net:

• Toshiba Corp.
• Blu-ray

Source: redOrbit Staff & Wire Reports

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