I love talking to my good friend, Camille, about product development and marketing. He is a product manager/engineer and his insights in this subject are always valuable. Today, during lunch we talked about the next media format battle: Blu-Ray Disc versus HD DVD. Camille said the following, which I thought made a lot of sense: "What determines which format will win in any format battle is convenience, not technical superiority or price. Think about it, between CD and vinyl records, customers chose CD at the end not because they offer better sound quality but for the convenience of not having to use the needle. Likewise, MP3 and iPod became super popular not because MP3 sounds better, but because MP3 is a great format for storing massive amount of data in one small device. Again, it is all about convenience."

Because we digressed some much from our conversation afterwards, we didn't have the chance to finish our discussion on the next dominant DVD format. But I subscribe to Camille's notion that consumers will always look for solutions that are most convenient for them. One can argue that in VHS vs. Betamax, VHS won because it was conveniently easy to buy VHS players and VHS tapes. In Laserdisc vs. DVD, DVD won because of it is conveniently smaller to handle than Laserdisc.

In continuing my thoughts on the topic of Blu-ray disc versus HD DVD, I think one of the most compelling features of HD DVD is that it is backwards compatible with existing DVDs. In other words, HD DVD players can play both HD DVD and DVD discs. In fact, there's a hybrid HD DVD that allows the disc to be played in a DVD player or HD DVD player. On the DVD player, only DVD information will be played. Furthermore, HD DVDs can be manufactured using the same fabrication process as that of CDs and DVDs, making HD DVDs relatively cheaper to produce than Blu-Ray Discs. So far, from most of the literature that I have read about HD DVD and Blu-Ray discs, it seems to me that it is more convenient for me to adopt HD DVD than Blu-Ray disc. On the contrary, will consumers appreciate the convenience of a higher storage capacity that Blu-Ray discs offer? Moreover, while the specifications for Blu-ray drive don't call for backwards compatibility with DVD, some manufacturers, like Samsung, have been developing Blu-ray drives that do. Both formats currently have about the amount of support from the industry. I think if the Sony PS3 and HDTV take off in the next two years, Blu-ray will emerge as winner. Otherwise, the future will be HD DVD. Ultimately, I think it is hard to predict which format will win; but I have a hunch that, like DVD+R versus DVD-R, the whole format compatibility becomes a non-issue as future DVD players will support both formats.

5/31/2006 4:36:24 PM (Eastern Daylight Time, UTC-04:00)

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