Toshiba Admits Defeat In Next Gen Disc War

As widely expected, officials from Toshiba have officially confirmed that the company is abandoning the HD DVD disc format, with all production of HD DVD drives and technology expected to end by March 2008, leaving Blu-ray as the sole market leader. In a statement the company announced that it will no longer develop, manufacture or market HD DVD players and recorders. The decision was taken following “recent major changes in the market” – as many stores and film studios move towards exclusive support of the Sony backed Blu-ray format. "We carefully assessed the long-term impact of continuing the so-called 'next-generation format war' and concluded that a swift decision will best help the market develop," said Atsutoshi Nishida, president and CEO of Toshiba Corporation. "While we are disappointed for the company and more importantly, for the consumer, the real mass market opportunity for high definition content remains untapped and Toshiba is both able and determined to use our talent, technology and intellectual property to make digital convergence a reality,” he stated. Toshiba will continue to provide full product support and after sales service for all existing Toshiba HD DVD products. However, it will immediately begin to reduce shipments of HD DVD players and recorders to retail channels, while aiming for a complete cessation of its HD DVD business by the end of March 2008. This will include volume production of HD DVD disc drive for such applications as PCs and games (possibly a reference to the Xbox 360 external HD DVD drive), with only notebook PCs with integrated HD DVD drives earning a possible short term reprieve. Support and production of standard DVD players and recorders will not be affected. As noted in a Microsoft statement yesterday the demise of the HD DVD format will not have any direct impact on the video games market as no title, for any format, currently uses it as a storage medium. However, it is widely expected that the news will positively impact sales of the PlayStation 3, which remains ones of the cheapest means of acquiring a Blu-ray player. Toshiba’s main focuses in the future will be on NAND flash memory, small form factor hard disk drives, next generation central processing units, visual processing and wireless and encryption technologies. The company will still maintain “collaborative relations” with its various HD DVD partners though, including Microsoft, Intel and HP, hinting that “Toshiba will study possible collaboration with these companies for future business opportunities, utilizing the many assets generated through the development of HD DVD”.