News Article
Chip makers could benefit from HD DVD agreement
The DVD chip market could be given a new lease of life following Toshiba's announcement that it has gained the support of a number of Hollywood studios to develop a new high definition DVD technology.
The DVD chip market could be given a new lease of life following Toshiba's announcement that it has gained the support of a number of Hollywood studios to develop a new high definition DVD (HD DVD) technology.
Makers of DVD players have been having a difficult time of it recently. Intense competition and market saturation - which have brought the cost of a DVD player down to less than $100 - have eaten away at their margins.
The slowdown in the DVD player market is one of a number of key factors that are expected to contribute to a poor start to 2005 for the semiconductor industry.
But, if the new HD DVD technology were to take off, consumers would be encouraged to update their old DVD players to the new format, creating a massive new market for consumer electronics companies.
Semiconductor firms would in turn benefit by supplying a new generation of chips for the HD DVD players.
The new HD DVD format provides greater capacity than its predecessor, allowing 30Gb - or eight hours of high definition footage - to be stored on a single dual-layered disk. This compares with the 8GB capacity of current DVD disks.
HD DVD will also benefit from variable disk capacity for longer and shorter programmes, web connectivity and new consumer options. The disks will be the same size as standard DVDs, ensuring backward compatibility.
Despite the advantages of the technology, much still needs to be done before it becomes the market standard.
As the legendary Betamax-VHS spat proved, the best technology does not always prevail and, although HD DVD currently seems best positioned to replace DVD, other rival formats may be developed to challenge it.
However, the technology has been given a major boost by the decision of Hollywood studios Paramount Pictures, Universal Pictures, New Line Cinemas and Warner Bros Studios to support Toshiba's attempts to develop it further.
Toshiba president and CEO Tadashi Okamura said: HD DVD offers the necessary combination of picture quality, content security and advanced features, plus manufacturing costs.
We believe this is why HD DVD is gaining broad acceptance and has won the support of each of these four leading studios.
The first HD DVD players are scheduled to hit the shops in late 2005 and they are expected to be widely available during 2006.
Toshiba is planning to launch its first HD DVD product, a CE player and recorder, in the fourth quarter of 2005. It is also aiming to release a notebook PC with built-in HD DVD drive by the end of 2005.
Makers of DVD players have been having a difficult time of it recently. Intense competition and market saturation - which have brought the cost of a DVD player down to less than $100 - have eaten away at their margins.
The slowdown in the DVD player market is one of a number of key factors that are expected to contribute to a poor start to 2005 for the semiconductor industry.
But, if the new HD DVD technology were to take off, consumers would be encouraged to update their old DVD players to the new format, creating a massive new market for consumer electronics companies.
Semiconductor firms would in turn benefit by supplying a new generation of chips for the HD DVD players.
The new HD DVD format provides greater capacity than its predecessor, allowing 30Gb - or eight hours of high definition footage - to be stored on a single dual-layered disk. This compares with the 8GB capacity of current DVD disks.
HD DVD will also benefit from variable disk capacity for longer and shorter programmes, web connectivity and new consumer options. The disks will be the same size as standard DVDs, ensuring backward compatibility.
Despite the advantages of the technology, much still needs to be done before it becomes the market standard.
As the legendary Betamax-VHS spat proved, the best technology does not always prevail and, although HD DVD currently seems best positioned to replace DVD, other rival formats may be developed to challenge it.
However, the technology has been given a major boost by the decision of Hollywood studios Paramount Pictures, Universal Pictures, New Line Cinemas and Warner Bros Studios to support Toshiba's attempts to develop it further.
Toshiba president and CEO Tadashi Okamura said: HD DVD offers the necessary combination of picture quality, content security and advanced features, plus manufacturing costs.
We believe this is why HD DVD is gaining broad acceptance and has won the support of each of these four leading studios.
The first HD DVD players are scheduled to hit the shops in late 2005 and they are expected to be widely available during 2006.
Toshiba is planning to launch its first HD DVD product, a CE player and recorder, in the fourth quarter of 2005. It is also aiming to release a notebook PC with built-in HD DVD drive by the end of 2005.
