Storage format war could kill the market

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The ongoing format war between Blu-Ray and HD DVD is harming confidence among buyers and could lead to both sides failing to reach critical mass according to a new analyst report.

Currently sales of both Blu-Ray and HD DVD eqipemtn have been small and the media analysts Screen Digest predicts that confusion over standards will stop many businesses or consumers investing in new systems. Instead they are likely to wait and see if one format winds out, or use other technologies in the meantime.

"The success of DVD was due to a single format that offered better quality and greater convenience than the VHS format that it replaced," said Graham Sharpless, author of the report.

"This time both formats support similar features. Blu-ray discs offer capacities of up to 50 GB compared with HD DVD's 30 GB. But Blu-ray is a revolutionary format that is more difficult and expensive to produce than HD DVD discs, which can be produced using modified DVD equipment."

He estimates that by 2010 the two formats will make up less than a third of the spending on digital media. Few people are expected to replace their DVD collections and the bulk of the growth will come from new films.

Microsoft has already announced that some features of Vista will work with HD DVD but the analysts think the effect on consumers will be limited.

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