BusinessWeek: ‘it looks as if HD DVD’s days are numbered’

“Every July, 400 of the most powerful media and tech industry chieftains meet at investment banker Herb Allen’s conference in Sun Valley, Idaho, for what are usually convivial discussions of megatrends and megamergers. But this year, Microsoft Chairman Bill Gates III laid into Sony Chief Executive Howard Stringer, according to two sources, including one who witnessed the exchange in a private room,” Cliff Edwards, Peter Burrows, and Ronald Grover report for BusinessWeek.

“Gates argued that Sony’s new high-definition DVD standard, called Blu-ray, needed to be changed so it would work smoothly with personal computers running on Microsoft’s Windows operating system. Stringer and two lieutenants defended the technology, insisting Blu-ray would work fine in PCs,” Edwards, Burrows, and Grover report. “Yet Gates’s ire only grew. ‘There must be something much deeper going on,’ Stringer said later, according to another person who heard the comment.”

“Despite the backing of the PC industry’s two biggest titans [Microsoft and Intel], it looks as if HD DVD’s days are numbered,” Edwards, Burrows, and Grover report… Sony appears to have a critical mass of support for its [Blu-ray] standard… A major factor swaying these companies is Blu-ray’s massive capacity. Its disks will hold at least 50 gigabytes and perhaps 100 gigs or more. HD DVD will start at 15 gigs, and top out at 45. ‘We want a standard that’s going to be around for 10 or 15 years,’ says one studio exec… Why is so much vitriol spilling from behind closed doors over one tech standard? The shiny little disk that Gates and Stringer tangled over has the potential to alter the landscape of the entertainment and technology industries.”

Excellent full article that explains the whole Blu-ray vs. HD DVD “war” here.

Related articles:
China to develop own as-yet-unnamed DVD format; Blu-ray vs. HD DVD vs ? – October 07, 2005
Paramount’s decision gives Blu-ray slight lead over HD DVD in next gen DVD format war – October 04, 2005
Record set straight on Blu-ray Disc Association’s superior high definition format – September 29, 2005
Microsoft backs cheaper, less sophisticated, lower capacity HD DVD over Apple-backed Blu-ray format – September 27, 2005
Twentieth Century Fox joins Apple, Dell, HP, others to support Blu-ray Disc format – July 29, 2005
Poll shows Apple-backed Blu-ray preferred by consumers over HD DVD for next-gen DVD standard – July 14, 2005
Microsoft allies with Toshiba on HD-DVD vs. Blu-ray Disc backers Apple and Sony – June 27, 2005
Apple joins Blu-ray Disc Association Board of Directors – March 10, 2005


  1. Gates blew it when he didn’t select Sony (must have been because Apple did . . .). The problem is that he selected the wrong option, but that’s not a surprise as this is the guy that brought us Bob.

  2. I love this quote…

    Microsoft’s criticism is that Blu-ray disks will be more expensive to manufacture and may be impossible to make in large volumes. Yet the technology’s supporters are convinced costs will be similar over the long term. “We don’t see any big cost difference, and we know a thing or two about volume manufacturing,” says Michael Dell, chairman of PC giant Dell.

    Talk about an understatement. LOL!

    MW: Society

  3. ken:
    Even more funny (perhaps), Bill’s wife Melinda actually headed up the Bob project. Her overwhelming insight to the future of GUIs told him she was THE ONE. ” width=”19″ height=”19″ alt=”tongue wink” style=”border:0;” />

    Does anyone wonder why the address for the Redmond campus is ONE MICROSOFT WAY? (all caps intended for poetic emphasis)

    “In those days spirits were brave, the stakes were high, men were real men, women were real women and small furry creatures from Alpha Centauri were real small furry creatures from Alpha Centauri.”
    – Douglas Adams

  4. Rah Rah; Apple’s winning, Microsoft’s losing. Can we get past the cheerleading and look at the actual implications of these technologies?

    BluRay intends to limit or remove fair personal for your video conent. With Apple so firmly entrenched in this camp, won’t it be difficult for them to move forward with the concept of the digital living room? Microsoft’s idea of streaming video from a computer through the XBOX-as-set-top is exactly what lots of people are hoping Apple will produce.

    With BluRay preventing any kind of “ripping”, that scenario is cut off at the knees, no?

  5. Sounds as if Gates has had his media R&D department forging away on HD-DVD related hardware/software. Gates can smell the stench of irrelevance for all those products MS is planning to release for the home media market. Sony’s looks as if it will be able to forego a repeat of the Beta vs VHS loss it suffered.

  6. Isn’t Bluray going to be using H264 standard for their content format? M$ have been trying to get their own propriety format VC-1 to be adopted for this open standard without success. Of course Apple have already got that to work.

    It seems to be that M$ wants their technology to be implemented in the next generation DVDs and it looks like they are going to be locked out.

    Streaming video is what really interests me. I wouldn’t mind having movies stored on a server (either at home or remotely), rather than having to have shelves of DVDs messing up the place. H264 seems ideal for this.

  7. It’s all about VC-1. HD DVD has it, Blu-Ray does not.

    Guess who developed VC-1?….

    Why it was Microsoft. Bill is getting the mad because folks don’t want to use his proprietary codec. Seems like the world is getting some spine in telling Gates to pound sand.

  8. << Why is so much vitriol spilling from behind closed doors over one tech standard? >>

    It’s simple. Blu-Ray uses the industry standard H.264 compression standard. HD-DVD is built around Microsoft’s VC-1. Without HD-DVD, Microsoft can’t control content. This is another case of Microsoft losing the standards battle. xBox is supposed to control the living room using HD-DVD.

    Microsoft was built by its ability to establish standards. Since the anti-trust trials, Microsoft has been unable to do so. Without control of industry standards, Microsoft can’t control the desktop.

    This isn’t the end of Microsoft. And it isn’t the beginning of the end, it is the end of the beginning (with apologies to Winston Churchill).

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